Understanding 'Medicaid Divorce'

I Consult with Individuals Who Do Not Pass Medicaid's Five-Year Lookback Rule

Steps can be taken to avoid the devastating cost of nursing home care, which can be as high as $10,000-$13,000 or more per month, from depleting your life savings. In order to avoid Medicaid's five-year lookback rule, couples generally have to make plans five years in advance. Unfortunately, many couples do not think about the cost of long-term care until one of the spouses is about to enter a nursing home. "Crisis planning" is never as good as planning ahead.

Couples who wait may find themselves in the unfortunate position of having to spend a lifetime of savings on nursing home care, often leaving the spouse who remains in the community with insufficient assets and income to live comfortably.

Although it may be possible to protect the marital home if the well spouse (called the "community spouse" in Medicaid language) continues to live in it, Medicaid regulations say that he/she can protect half of the marital savings, but not more than $123,600. This means that a couple with $500,000 in investments must use all but $125,600 ($2,000 for the applicant and $123,600 for the spouse) before Medicaid will start paying for nursing home care. A couple with more modest savings of $100,000 can protect only $50,000.

Consider a Medicaid Divorce

One possibility is to consider a "Medicaid divorce" as a means of saving money for the community spouse. If a divorce is handled properly, the community spouse will be awarded an equitable share of the marital assets, and perhaps alimony as well, and will have no responsibility for the nursing and other long-term care expenses of the former spouse. When the time comes for Medicaid to act, only the assets of the institutionalized person will be taken into consideration. The assets of the former spouse will be protected.

At the law office of Michael C. Rudolph, Esq., P.A., in Kinnelon and Riverdale, New Jersey, my understanding of the issues senior citizens face, along with my having represented clients in divorce matters for many years, makes me well-qualified to guide families through difficult times. I know the law and I know the rights New Jersey law provides in family law cases.

Connect with Us For A Consultation

Call 973-850-4121 or contact my office online to discuss whether a Medicaid divorce is appropriate for your family situation. I am available during regular business hours or by appointment. I offer appointments at my Kinnelon and Riverdale offices for your convenience. Both offices are handicap accessible.

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