Will an Increase in Income Make a Nursing Home Resident Ineligible for Medicaid?

If a married couple is on Medicaid and one passes away, causing the survivor's assets to exceed the $2,000 limit (because the survivor begins receiving an increased Social Security benefit), will the survivor lose Medicaid eligibility?

You have a few issues here revolving around the distinction between income and assets. When you receive your Social Security benefits at the beginning of the month, it may push your account over $2,000. However, during that month the Social Security is not treated as an asset. Instead, it’s income. It only becomes an asset if you don’t spend it by the end of the month. So, for instance, let’s assume you have $1,500 in your bank account on April 30^th. On May 1, you receive $1,000 from Social Security, bringing your account to $2,500. That’s not a problem as long as you spend at least $500 during the month, bringing your account back down to $2,000 or less by May 31^st. If you don’t spend the money and still have $2,500 on June 1^st, you will have a problem. It's almost impossible for there to be a problem in the nursing home setting because even when you receive Medicaid coverage you must pay virtually all of your income, less a small personal needs allowance, to the nursing home.

For more information about Medicaid and income, click here.