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April 28, 2005
MASSACHUSETTS MEDICAID VS FLORIDA MEDICAID
Every year, school vacation coincides with the end of tax season, and my family and I find ourselves on a beach, usually in Florida. This week we are at Anna Maria Island, just off the coast of Sarasota, Florida. The island is devoid of any fast-food restaurants and the children spend the day frolicking in the waves and playing on the beach. An added bonus to this year’s vacation is that the World Champion Boston Red Sox are playing a triple header at Tropicana Field in Tampa and we are going to see them play tonight! This is such a beautiful place, I had to find out how their laws compare to those in Massachusetts, if someone needed nursing home care.
Most nursing home care is paid for by Medicaid. Medicaid is a federal law that is administered by each state, and the differences in how each state treats assets can be substantial. So, if you are interested in moving to Florida, here are some of the major differences between Florida and Massachusetts;
ASSET LIMIT – For single individuals, Massachusetts and Florida have the same $2,000 asset limit. A single person must have less than $2,000 in assets to qualify for Medicaid.
For a married couple in Massachusetts, when one spouse needs nursing home care, they are allowed to keep one-half of their assets up to about $97,000. The home is never a countable asset as long as one of the spouses continues to live in the house. In Florida, a married couple may keep the first $97,000 of assets. The Florida rule is more favorable because it allows a married couple to keep the first $97,000 of assets and not only one-half of your assets up to $97,000.
IMMEDIATE ANNUUITIES –Since, in Massachusetts, we are only allowed to keep one-half of the countable assets, almost every couple will have excess assets that will need to be spent down. A common way of dealing with these excess assets is to purchase an annuity that converts those excess assets into income of the spouse living at home. Income of the spouse living at home is non-countable in determining Medicaid eligibility for the sick spouse. This is also allowed in Florida.
LIFE INSURANCE – The cash surrender value of a life insurance is treated as an asset. This is the same in Florida as in Massachusetts. In Massachusetts, if the face value of all of your life insurance policies is less than $1,500, the cash surrender value of the policy or policies is exempt and not counted as part of your assets. In Florida, life insurance policies with a cash surrender value of less than $2,500 are exempt.
BURIAL ACCOUNT – A burial account is a separate bank account that is intended for burial expenses not covered by a prepaid funeral. Examples of this would be; Cemetery fees, inscriptions and the meal following the funeral. In Massachusetts you may deposit up to $1,500 for a burial account. Florida allows $2,500.
Florida has filed for a Waiver similar to the one requested by Massachusetts in 2003. The waiver is a request by the State to the federal government asking for permission to make up their own rules for Medicaid eligibility. Many other states have filed for waivers, I don’t know any that have been approved as of this date.
Based on the results above, it seems that Florida has a small advantage over Massachusetts. Florida and Massachusetts are very similar in constantly changing the laws that govern Medicaid, the program that pays for nursing home care. Massachusetts currently has seven bills in the State Legislature that affect the elderly. Florida’s legislature is equally busy. Historically, Florida has been very generous in their Medicaid rules but due to the skyrocketing cost of medical care they are definitely tightening their belt.
This is a list of the bills in front of the Massachusetts Legislature at this time. Next week I’ll give you a status report on how they are progressing through the legislature.
· Income First - Docket # HD3687 and SD1148 Representative Doug Peterson and Senator Mark Montigny
· Community Spouse Resource Allowance - Docket # HD2629 and SD1150 Representative Frank Smizik and Senator Mark Montigny
· Transfer of Assets Waiver Repeal - Docket# HD3609 and SD1369, Representative Frank Hynes and Senator Robert Creedon,
· Long Term Care Insurance & Estate Recovery - Docket#HD730, Representative Kathleen Teahan,
· Personal Needs Allowance Restoration - Docket #s HD2207 and SD1997, Representative Ann Paulson and Senator Steve Panagiotakos,
· Long Term Care Public Education Program - Docket# HD1004, Representative Ruth Balser,
This article gives general information and not specific advice on individual matters. Persons wanting individualized advice on matters discussed should contact an advisor experienced in those matters. To the extent this article provides information on legal matters, it is based on law in effect in Massachusetts on the date of posting (laws in effect in other states are often quite different).
Ronald H. Surabian is a CPA and attorney who works at the Elder Law Center in Saugus, Ma. He also holds a masters in accounting and a masters in tax law. He currently serves on the board of directors of the Massachusetts Chapter of the National Academy of Elder Law Attorneys.