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In truth, Medicaid can be a resource for many individuals, based on whether they meet the income and asset criteria for eligibility. However, especially in states like Texas that have strict caps on how much money a person is allowed to make to still receive benefits, it can be difficult to prove that you meet the criteria. An experienced Medicaid planning lawyer can help you prepare for the costs of long-term nursing home care so that these costs do not burden your family in the future.

What Is Medicaid?

Medicaid is a cooperative effort between the federal government and the state that provides medical benefits to eligible people who would otherwise not be able to afford health care. The program also provides long-term care for eligible recipients age 65 or older, including care received at residential nursing homes, assisted living facilities, and adult day care programs.

Income and Asset Limits in Texas

There are several long-term care benefits that can be provided through Medicaid to Texas residents, and each benefit has its own income and asset limit. As of 2022, the following limits apply:

  • If you are single, Medicaid for institutional/nursing home care and Medicaid waivers for home- and community-based services have an income limit of $2,523 per month and an asset limit of $2,000. 
  • If you are married but only one spouse is applying for Medicaid benefits, Medicaid for institutional/nursing home care and Medicaid waivers for home- and community-based services have an income limit of $2,523 per month for the applicant along with an asset limit of $2,000 for the applicant and $137,400 for the non-applicant.
  • If you are married and both spouses are applying for benefits, Medicaid for institutional/nursing home care and Medicaid waivers for home- and community-based services are available if you make no more than $5,046 a month with an asset limit of $3,000.
  • The income limit for regular Medicaid services for someone who is single and elderly, blind, or disabled is $841 a month with an asset limit of $2,000. For someone who is married, the income limit is $1,261 a month with an asset limit of $3,000, regardless of whether one or both spouses are applying.

How Can Qualify for Medicaid if I Exceed These Limits?

If you exceed the income limits to qualify for Medicaid, there are a few other options for obtaining the benefits, including:

  • A Qualified Income Trust (QIT), also known as a Miller Trust, is an irrevocable trust that is created to hold income over the qualifying limit for Medicaid. The trust is overseen by a designated trustee who can only access the funds for a limited reason, such as paying unreimbursed medical expenses. An estate planning lawyer can assist you in setting up your QIT.
  • A Medicaid Asset Protection Trust (MAPT) is an irrevocable trust that is created to hold title to your assets and prevents them from being countable against your estate value for Medicaid qualification purposes. An MAPT needs to be set up and funded at least 5 years prior to any need for Medicaid services, or else a penalty may be incurred. An estate planning lawyer can assist you in setting up your MAPT.
  • Medicaid planning activities, such as spending down excess assets, transferring assets to a spouse or other family member, irrevocable funeral trusts, and more, offer additional means of qualifying for benefits.

Finding the Best Houston Medicaid Planning Lawyer for You

Medicaid planning services often feature a multipronged approach to preparing an individual financially for long-term care, focusing on providing the intended Medicaid recipient with the best opportunity possible for being accepted into the Medicaid program. Medicaid planning lawyers can not only assist you in determining whether you meet the eligibility specifications to receive nursing home assistance through Medicaid, but they can also help you create trusts and other asset protection approaches and even provide assistance in completing your Medicaid application.

Some of the common issues that require a Houston Medicaid planning attorney include:

  • Determining Medicaid eligibility for the nursing home placement of one spouse while the other spouse intends to remain in the family home
  • Determining if excess resources can be converted to non-recoverable assets in order to save them for family members
  • Avoiding simple errors that can result in the reduction of Medicaid benefits available or can even result in the loss of assets intended to be given to family members

Nursing home care can cost more than $75,000 a year in Texas. These costs can be debilitating to a family who is unprepared. Our firm helps individuals to protect their assets for their family members while also obtaining the necessary assistance with affording nursing home care. Contact us to begin developing a strategy for your future.

Frequently Asked Questions

Yes. While Texas has a strict cap on the income and assets you can have and still be eligible for Medicaid, the state does allow an exclusion for your personal residence—if the residence is also located in Texas and the applicant intends to return to the home if they are able to do so. The applicant can also qualify for Medicaid by transferring the home to a spouse.

It should be noted that if you transfer ownership of your home to someone other than your spouse, there may be a period of time in which you are not eligible for Medicaid. This is known as the penalty period. This penalty period can be avoided if the home is transferred via a revocable transfer on death deed (TODD) or a lady bird deed in Texas.

If you received Medicaid in order to pay for long-term care services such as nursing home care, every state’s Medicaid program has a Medicaid Estate Recovery Program. This program allows the state to seek repayment for their services through a deceased recipient’s estate. Medicaid explains this program to all new recipients and also files a notice with the representative of the estate, letting them know that it intends to file a claim.

The types of property that Medicaid can seek repayment through include the home and personal belongings left to heirs. Medicaid cannot seek repayment from assets transferred outside the probate process, including trust assets, real estate transferred by TODD or lady bird deed, financial accounts with pay on death beneficiaries,  or retirement accounts or life insurance policies with properly designated beneficiaries.

Texas residents who are eligible for Medicaid include those who are pregnant, responsible for a child 18 years or younger, blind, disabled, living in a household with someone who has a disability, or at least 65 years of age and meets the income and asset limits.