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Joint Bank Accounts and Medicaid Eligibility
You may be in the process of assisting an aging parent in need of nursing home care. There are many regulations and eligibility requirements to obtain governmental assistance to help pay for their care. Consultation with an elder law attorney is critical before proceeding to making sure actions are not taken that would penalize them from getting the care they need.
Like most governmental benefit programs, there are many myths surrounding Medicaid and eligibility for benefits. One of the most common myths is the belief that only 50% of the funds in a jointly-owned bank account will be considered an asset for the purposes of calculating Medicaid eligibility.
Medicaid is a needs-based program that is administered by the state. Therefore, many of its eligibility requirements and procedures vary across state lines. Generally, when an applicant is an owner of a joint bank account, the full amount in the account is presumed to belong to the applicant. Regardless of how many other names are listed on the account, 100% of the account balance is typically included when calculating the applicant’s eligibility for Medicaid benefits.
Why would the state do this? Often, these jointly held bank accounts consist solely of funds contributed by the Medicaid applicant, with the second person added to the account for administrative or convenience purposes, such as writing checks or discussing matters with bank representatives. If a joint owner can document that both parties have contributed funds and the account is truly a “joint” account, the state may value the account differently. Absent clear and convincing evidence, however, the full balance of the joint bank account will be deemed to belong to the applicant.
If you are considering Medicaid for a loved one, it is important to seek expert advice on how to deal with assets and income correctly. Preplanning or a strategic crisis plan can make the difference between qualification and disqualification.