RALPH S. ROBBINS, CFP^©

A CERTIFIED FINANCIAL PLANNING PRACTITIONER

specializing in

elder care and special needs planning

The income test

Florida is one of many states that places a cap on the income an applicant can receive to be eligible for Medicaid.  If the applicant's income exceeds the cap by even one dollar, then they may not meet this requirement (there is, however, a solution to this problem).  If there is a spouse not applying for benefits (known as the "Community Spouse"), then his or her income is not considered but his/her income needs are.  All figures are as of January 1, 2010.

Very Important:  Virtually all of the applicant's income is expected by the state to be applied to the cost of the applicant's care (known as "patient responsibility"). Medicaid pays the difference between the cost of care and the applicant's income (minus exceptions).   

1. Income requirements for the applicant:  Gross monthly income cannot exceed $2,022.00.  This is after a $35 allowance for "patient personal needs".  If income exceeds that level, it may be possible to establish an Irrevocable Qualified Income Trust to meet the requirement.

2. Income requirements for the Community Spouse:  No limit.  The Community Spouse's income is not considered in determining the applicant's eligibility.  The Community Spouse is entitled to a minimum monthly income if their own is insufficient.  This is called the Monthly Maintenance Needs Allowance and ranges between a minimum of $1,822.00 and a maximum of $2,739.00.  If the community spouse's own income is insufficient to meet their needs income will be diverted from the applicant spouse to the community spouse and Medicaid will pay a larger percentage of the expense.

  What is Income?

  For eligibility purposes Income is defined as gross income not net.  For example, most have Medicare Part B premiums subtracted from their Social Security benefit.  This must be added back when determining gross income.  Similarly, many have health insurance premiums, other benefit premiums, or taxes deducted from their pension income.  This, too, must be added back to in calculating gross income.

  What is considered income?  Virtually every source of income is considered countable.  Social Security, pensions, disability benefits, VA benefits, interest income, non-taxable income, dividends, IRA or other qualified plan distributions, income from annuities, income from ongoing business concerns or income producing property, and anything else the applicant may be receiving is considered income with rare exceptions.

  Once the Income test is met, the applicant must pass the Asset test.

To learn about the Asset Test, click here:

The Top Eight Medicaid Eligibility Mistakes.

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