The 2020/2021 New York State Budget has been approved by the legislature and signed into law by the Governor. It provides for significant changes in the Medicaid rules which we have seen in 14 years.

Spousal Refusal

One important aspect of this budget is that spousal refusal has survived, and the Spousal Impoverishment Resource Allowance remains at $74,820.00 instead of being reduced to $25,728.00. Spousal refusal is a legally valid Medicaid planning option that exists in New York and Florida. This states that certain assets and income are exempt from Medicaid when you have a spouse. This usually occurs when one spouse is being cared for in a facility, while the other one is not. Spousal Refusal is vital for elderly couples because it is almost impossible for the spouse at home, referred to as the “community spouse” to live off of Medicaid allowances.

Medicaid Look Back Period

The bad news is that effective October 1, 2020, for applicants applying for community based Medicaid (homecare), there will be a 30 month “look back” period. This means that applicants must show records of all financial transactions and assets during that look back period. It is unclear how transfers during the penalty period will be calculated to determine ineligibility or if the nursing home regional rates will be used to determine ineligibility.

Additional Changes

There are also changes to the personal care and CDPAP services which are now defined much more narrowly. The DOH will contract with an “Independent Assessor” to replace the function now performed by local districts. MLTC plans and mainstream Medicaid managed care plans for determining how much personal care and CDPAP to be authorized.

Existing Home Care

Current home care recipients are grandfathered in and they are not subject to these new limits. New applications after October 2, 2020 will be subject to the new law.

For more than 40 years, our firm has been assisting people like you with long term care and estate planning needs. We bring you the knowledge and resources to protect you and your family. Armstrong & Lamberti, PLLC does not provide tax, legal, or accounting advice by articles. This material has been prepared for informational purposes only and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. Call 718.477.7700 or contact us online to schedule a free initial consultation with an estate planning attorney at Armstrong & Lamberti, PLLC. We proudly serve Staten Island, Brooklyn and the other boroughs of New York City.