Whether you’re already a senior or just planning for the future, it’s nice to have a sense of security and peace of mind. Besides estate planning, another big thing you can do is to choose how and where you want to receive care as you age. This is known as advance care planning or long-term care planning.
Medicaid is a common consideration in long-term care planning, and it can be a great option! However, eligibility requirements vary by state and are often difficult to make sense of.
In Texas, one crucial piece of that puzzle is understanding how your Medicaid eligibility will be influenced by your assets and income. We’ll break it all down for you in this post so you can make a more informed decision.
A closer look at Medicaid eligibility rules in Texas
There are three available Texas long-term care Medicaid programs:
- Institutional Medicaid, aka Nursing Home Medicaid
- Medicaid Waivers, aka Home and Community Based Services
- Regular Medicaid, aka Medicaid for the Elderly and People with Disabilities
Institutional Medicaid and Medicaid Waivers require you to stay in a nursing home, while Regular Medicaid allows you to stay in your home and get help with daily activities.
Texas requires that seniors have limited income and assets and a medical need to qualify for Medicaid long-term care. Each program has its own limits that vary depending on your filing status.
Medicaid income limits
Income limits to qualify for Medicaid long-term care in Texas are:
- Single: $2,829 per month for Institutional Medicaid and Medicaid Waivers, or $943 per month for Regular Medicaid.
- Married applying jointly: $5,658 per month for Institutional Medicaid and Medicaid Waivers, or $1,415 per month for Regular Medicaid.
- Married with only one spouse applying: $2,829 per month for the applicant for Institutional Medicaid and Medicaid Waivers or $1,415 per month for Regular Medicaid.
Medicaid asset limits
On the other hand, asset limits are:
- Single: $2,000 for all Medicaid programs
- Married applying jointly: $3,000 for all Medicaid programs
- Married with only one spouse applying: $2,000 for the applicant and $154,140 for the non-applicant for Institutional Medicaid and Medicaid Waivers; $3,000 for Regular Medicaid
As you create plans for long-term care, your estate, and other future-focused plans, it can be helpful to work closely with an experienced attorney and financial planner. They can help you create a strategy for maintaining your Medicaid eligibility while preserving your assets.
A breakdown of assets and income in Texas
The Texas Health and Human Services Commission (HHSC) reviews and analyzes your income and assets closely to determine if you qualify for Medicaid. So, what counts in these categories, and what doesn’t? Let’s take a look.
Countable and non-countable income
Most forms of income count toward Medicaid’s income limit. This can include:
- Employment wages
- Pension payments
- Alimony payments
- Social Security Income (SSI)
- Social Security Disability Income (SSDI)
- Stock dividends
- IRA withdrawals
Only Holocaust restitution payments and the Veteran’s Aid & Attendance and Housebound Allowances don’t count as income.
If you’re married and only one person applies for Institutional Medicaid or a Medicaid Waiver, then the HSCC doesn’t count the spouse’s income to determine eligibility. However, if only one of you applies for Regular Medicaid, both incomes count toward the applicant’s income eligibility.
Countable and non-countable assets
There are also countable and non-countable assets. Countable assets count towards your asset limit and include:
- Bank accounts
- Real estate you don’t live in
There are a number of assets that aren’t countable, however. These include personal belongings, household furnishings, an automobile, and irrevocable burial trusts. In Texas, IRAs and 401Ks may also be exempt as long as they are in “payout” status, meaning that the required minimum distribution (RMD) is being withdrawn.
How Medicaid planning can help you maintain eligibility
Many people struggle with finding the right balance between preserving their assets and accessing much-needed Medicaid benefits. It’s common, for example, for some people to sell off assets like their home or investments to reduce their assets… but this isn’t necessarily required or even advisable.
To put yourself in the best position possible for maintaining Medicaid eligibility, seniors should work closely with an attorney on Medicaid planning.
An attorney can help you assess your options for different long-term care planning vehicles so you can be confident your future is secure. Optional vehicles for Medicaid planning include:
- Medicaid asset protection trusts (MAPTs)
- Miller Trusts/Qualified Income Trusts
- Gifting and charitable giving
Get help with Medicaid—and more—from compassionate Texas elder law attorneys
Wading through all the Medicaid eligibility requirements and the different programs that exist can feel overwhelming. The law firm of Shann M. Chaudry Esq., Attorney at Law PLLC, is here to help.
Our team of compassionate elder law attorneys understands the challenges and concerns you face. That’s why we work with you to design a customized approach to meeting your financial and legal needs as you age. We’ll create a comprehensive plan for your unique goals, needs, and family situations so you get the best outcome possible.
Contact us today to see how we can help you plan for your future and achieve peace of mind.