How to Apply for a Medicaid Waiver When You Have Too Much Money

Don’t get discouraged if someone tells you that you have too much money for Medicaid. There are many different medicaid programs and many ways to qualify. It is not possible in all cases, however, many of our readers were told they would not qualify, but still found ways to apply and get approved.How to Get Medicaid When You Get Turned Down

Step One: Exclude other people’s income

To start out make sure you are not including other people’s income:

• For married adults, in most cases your spouse’s income will not count, unless your spouse is also applying for disability home aides. Count your income only.
• For disabled children, in most cases parent’s income will not count, unless your spouse is also applying for disability home aides. Count child’s income only (child support, SSI, etc)
• If you live with other people, other people’s income does not count (unless they are giving the money to you).

Exception, if both you and your spouse are applying for Medicaid waivers, the rules are different. Your spouse’s income will count.

Step Two: Make Sure Medicaid Excludes Other People’s Income

One common reason people get denied is because the person processing their application doesn’t know how waivers work (or doesn’t understand that this is a waiver application) and includes income from a spouse, parent, or someone else you are living with.

Make sure any application you fill out is for “medicaid waiver” or “medicaid long term care” – not regular Medicaid health insurance. Some people apply on paper and write in large letter on the top of every page “Medicaid Waiver application – Income excluded.” Some people find it helpful to call and talk to supervisors or ask for the name of the person at the local Medicaid office who oversees “Medicaid Waivers” or “Medicaid Long Term Care.”

In some states, Medicaid will instruct people to simply leave excluded people off the application. Please check with the Medicaid longterm care worker before doing this. For example, some Medicaid workers will tell parents to leave their own names and finances off their child application, including only their child’s name and income (SSI, child support, etc).

Step Three: Make Sure You Are Looking at the Right Income Limits

In many states, the income limit for disability Medicaid is $800 per month. The income limit for Medicaid waivers is often $2,300 per month. Big difference!

Step Four: Make Sure Medicaid is Looking at the Right Income Limits

Once again you want to apply for “Medicaid Waivers” or “Medicaid Long Term Care” or whatever the waiver program is in your state.

Step Five: More Complicated Problems

If everyone’s income is excluded, and you still have too much money, there are sometimes other solutions.

Medicaid financial rules are complex and detailed. You may wish to contact your local Centers for Independent Living and Area Agency on Aging and Disability (serves all ages) and request a referral to someone who can assist with Medicaid planing. Or set up a consultation with a special needs planning lawyer, 

Below is an overview of solutions that have worked for some of our readers.

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What’s Your Problem?

If you got turned down for Medicaid for financial reasons you are probably experiencing one of the following problems:

• Too much income (work or disability check)
• Too much resources (stuff you own or savings)
• Too much income and too much resources
• You never applied. Someone told you that you don’t qualify and you gave up. (Don’t do this!!!)

Depending on the problem, there are many possible solutions.

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OPTIONS FOR TOO MUCH INCOME

Ignore Your Spouse – If you see an income limit for “married” you can ignore this unless your spouse is also applying for a Medicaid waiver.

Don’t Be a Dependent – Some forms of Medicaid consider a “household” to be anyone declared as a dependent. If someone has declared you as a dependent, and this is disqualifying you, make sure to look into this. Tip: The rules usually state that they consider who is expected to be declared as a dependent on next year’s taxes. So if you were a dependent last year, it may not be too late to apply on your own.

Open an Income Trust – If your income is still too high, some states will allow you to open a “miller trust” or “qualifying income trust” or “pooled income trust” so that you can qualify. Some of your income will go into your trust, but can still be used to help you pay your bills. You may wish to consult with a medicaid planner or hire a special needs planning lawyer. Or try contacting independent living centers or aging and disability resource centers in your area to see if anyone can provide free assistance. Here is a list of pooled income trusts in New York. 

Note About Pooled Income Trusts – This type of trust is different than a Special Needs Trust. Special Needs Trusts are for assets and are much more common. Very little information is available online about pooled trusts, and we have not yet heard from any readers who have tried this. Please comment below if you have experience or input with pooled trusts. Learn more how these trusts work in This Fact Sheet  (this link is from new york, but gives very helpful information that may apply in other states.)

If You are Married – If you are married and the problem is your own income (not your spouse’s income) some states will allow you to designate a portion of your income towards your spouse. In some cases that can help you to qualify. Because these rules are complex, meeting with a medicaid planner or special needs lawyer may be helpful.

Medicaid Buy-In Programs – Most states have Medicaid buy-in program for working people with disabilities. Many people who are too disabled to work regular jobs still qualify for this program if they are doing small amounts of at-home work (babysitting, pet sitting, art making, etc). Income limits vary a lot. Sometimes as high as $80,000 per year. Spousal income does not count. Medicaid buy in programs

Income Exclusions – Some states have regulations that allow you to not count all your income. For example, in California they do not count any amount you pay for health insurance premiums, so many people purchase some dental, vision, or other supplemental insurance. This brings down their countable income, allowing them to qualify.

Avoid Spend Down and Share of Cost – Some states will offer you Medicaid through a “medically needy” or “medicaid spend down” or “share of cost” program. In many states these programs are terrible and will leave you impoverished. How to Eliminate Share of Cost, Patient Pay and Spend Downs

Move – If you need home care to survive, some people move to a different state with a higher income limit. You are generally able to start the Medicaid waiver application process the first day you establish residency in your new state, but it make take several months (or more) to process.

Ignore People Who Work at Medicaid – Many of our readers report being told wrong information by people who work at Medicaid. Do your own research, and make sure to see any policy in writing. Never let anyone turn you down verbally. How to Respond When You Are Told You Can’t Get Medicaid

Get Married – You’ve probably heard stories of people getting divorced to get medicaid. Ironically, in some situations, the opposite is true. Some states have “spousal impoverishment protections,” allowing you to dedicate some of your income or resources to a spouse. If your spouse is not also applying for a Medicaid waiver, their income and resources usually won’t count.

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OPTIONS FOR TOO MUCH RESOURCES 

Rules for resources are different than rules for income. Resources are things you own and money in the bank.

Don’t Count Everything – Not all resources count. One car, one house, and many other things do not count. The rules are different in every state, however, they are very often very similar (and sometimes exactly the same) as the SSI rules. You can see those here: What Counts as a Resource for SSI?

Check the Limits – Once again, DO NOT LOOK AT THE MEDICAID GUIDELINES. Resource limits for Medicaid waivers are totally different then for other forms of Medicaid. $2,000-$3,000 is a common resource limit in most states, but it is higher in some places. The financial information about waiver programs on Paying for Senior Care is generally accurate. (Most senior programs will also be open to younger people with disabilities)

Ignore Your Spouse Again – Rules for spouses are tricky and confusing. If you see a financial limit for a married couple, you may be able to ignore this. In some states, this limit is only if your spouse is also applying for a home aide. Some states allow spouses to keep extra resources – sometimes as high as $120,000 plus a house. Some states will allow you to count 50% of resources as belonging to spouse and other states will allow you to count 100%. Some states have stricter limits for spouses.

Learn About Buy Ins – Some states have no asset limit for buy in programs. Most have Medicaid buy-in program for working people with disabilities. Many people who are too disabled to work regular jobs still enter this program if they are doing small amounts of at home work (such as babysitting, pet sitting, art making, etc). Medicaid buy in programs

Don’t Give Stuff Away – If you give away money or resources, you may be ineligible for up to five years. If you sell something for less than it is worth the same thing can happen. For example, do not sell your car to your son for $1.The rules are different in every state, however, they are very often very similar (and sometimes exactly the same) as the SSI rules. You can see those here: How to Handle If You Are Over the Resource Limit

Open a Special Needs Trust – If your money or resources are in certain types of trusts, they will not count for Medicaid. This can cost a few thousand dollars. However, many people find it worth it, as it can protect assets and help you get care for the rest of your life. You may wish to consult with a medicaid planner or hire a special needs planning lawyer.

Notes About Special Needs Trusts – In some situations, after opening a trust you will need to wait five years before being eligible to apply for a medicaid waiver (this generally only applies to seniors). Also, certain types of trusts are called “self-settled trusts.” For this type, when you pass away, any money left in the trust will go back to Medicaid. It cannot be inherited by anyone.

Open an ABLE Account – This is similar to a trust, but there are limits to how much you can put in and it is only for people who first became disabled before age 26. Costs are minimal and you can do it yourself without needing a lawyer.

Notes about ABLE Accounts – Many people wrongly think that an ABLE account will help them if they have too much income. It will not help if you have too much income on a monthly basis. It can be helpful if you have too much savings, or if you have one-time income (such as a small inheritance or lottery winning).

Spend Money or Buy Stuff – You are also allowed to spend resources in certain allowable ways. The rules are different in every state, however, they are very often very similar (and sometimes exactly the same) as the SSI rules. You can see those here: How Can I Spend Money While on SSI?

Wait Five Years – Most states have a five year look back period. If you have given money or resources away, you may need to wait up to five years before you are eligible to apply. The length of time you have to wait depends on your state, and the value of the resources. After five years, Medicaid no longer cares what you did with your money.

Too Many Cars – Some state Medicaid programs will only allow you to own one car (even if married). Other states do not have this rule. If cars are an issue for you, these SSI rules are similar to many Medicaid programs: How to Own Two Cars

Once Again, Ignore People Who Work at Medicaid – Many of our readers report being told wrong information by people who work at Medicaid. Do your own research, and make sure to see any policy in writing. Never let anyone turn you down verbally. How to Respond When You Are Told You Can’t Get Medicaid

Get Married – Once again, some states have “spousal impoverishment protections,” allowing you to dedicate some of your income or resources to a spouse. For example, in Florida, a spouse can keep $120,000 of shared assets (plus a house of course). These rules are complex, so please research carefully.

OTHER (NOT AS GOOD) OPTIONS

Medicaid waivers are widely viewed as the best home aide programs and will give you more hours, support, choice and flexibility than most other programs. If all else fails, here’s a few back up options:

💠 If you live in Florida and you are working and not receiving disability: WIPAS Program

💠 If you are over age 55 and live in Washington State: TSOA program.

💠 If you are over age 60, and live in Georgia: Non-medicaid program.

💠 In Indiana, at any age: CHOICE program.

💠 In North Carolina, any age if disabled: Home Aide Program

💠 Other types of programs: Other Caregiver Programs

💠 Also check programs in your state here: State-by-State List (ignore where it says senior. Most programs will accept disabled people of any age.

DISABLED CHILDREN

💠 If you are a parent and your child is disabled, most waiver programs will not count any of your income or assets. Learn more Kids Waivers.

💠 Many readers who are parents report being told the wrong information about this by the Medicaid office or having their application processed incorrectly. Do your own homework, and make sure your income is excluded.

💠 They will still count income and assets belonging to your child. If child support is making your child ineligible, some parents have had success consulting with a medicaid estate planning lawyer to see if it is possible to change the court support order to direct support into a special needs trust.

💠 Bonus: In California and Colorado, parents can be paid to be caregivers for their disabled children who are minors. In all states, parents can be paid caregivers of adult children.

More Reading

💠 If you’d like to chat with other people in Medicaid waiver programs and learn how they did it: Facebook Groups for Medicaid Home Care

💠  Check out Pansy’s Story: How Pansy Got on Medicaid By Being Smart, Scrappy & Persistent

Updated April 2018. Please comment below with stories, ideas, questions or suggestions. Please let us know if any links on this page stop working. If you found this page helpful, please share it with others by pressing one of these magic little buttons: