[WSBAPT] Medicaid and pre-nuptials

[Jane Bitz]

Kerry:

DSHS will count the funds as an available resource to pay for husband’s care, even though it is a separate asset of the wife and there is a pre-nuptial agreement.

There is some planning that can be done to qualify the husband for Medicaid assistance. The maximum amount of the Community Spouse Resource Allowance (CSRA) for the non-Medicaid spouse is: $123,600. If the wife has more than that from the sale of the house, she can annuitize the amount above the CSRA. It has to be a Medicaid compliant Single Premium Immediate Annuity (SPIA). Essentially the money is paid to the insurance company and they pay it back to the wife as a monthly income. When re-applying for Medicaid the dollar amount use to purchase the annuity is not counted as a resource to pay for husband’s care. Wife gets to keep all of her income every month and she can accumulate the payments and reinvest them without her spouse being disqualified for Medicaid assistance.

I recommend that your client consult an elder law practitioner in your area to assist with the SPIA and with the re-application for Medicaid benefits for the husband. Eileen Peterson at Gordon Thomas Honeywell LLP or Tim Williams are both great lawyers in your area.

Jane Bitz.

Jane G Bitz
Of Counsel
Wolff, Hislop & Crockett, PLLC
12209 E Mission, Suite 5
Spokane Valley WA 99206-4824
(509) 927-9700; FAX (509) 777-1800
jbitz at whc-attorneys.com<mailto:jane at jbitzlaw.com>
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From: wsbapt-bounces at lists.wsbarppt.com [mailto:wsbapt-bounces at lists.wsbarppt.com] On Behalf Of Brink, Kerry
Sent: Friday, January 5, 2018 5:47 PM
To: WSBA Probate & Trust Listserv <wsbapt at lists.wsbarppt.com>
Subject: [WSBAPT] Medicaid and pre-nuptials

Greetings,

I was contacted by a fellow that has PoA for his mother who remarried 10 or so years ago after completing a prenuptial agreement.  Her Husband is in an assisted living facility and will not qualify for Medicaid (that her son applied for on her behalf) because of proceeds from the sale of the mother’s house are now in an account over which my potential client/agent has access. Both mother and step-father are incapacitated and living in separate care facilities.  I have seen the prenuptial agreement and the house and proceeds are clearly mother’s separate assets and there is no care requirement in the pre-nup.  I understand that mother’s Will leaves all assets to her three children – not to husband.  I have not, however, seen the Will.

Even though the mother’s account is keeping step-father from Medicaid eligibility, is there a requirement that her separate assets be used to pay for step-father’s care?  Mother is in an assisted living facility herself and may need the assets for her own care.  I know dissolution is an option, but no-one wants that.  Anything else?

Thanking you in advance for your wisdom,
Kerry
Kerry E. Brink • Attorney at Law

Estate Planning, Probate, Elder Law

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