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What Happens to a Medicaid Recipient If the Community Spouse Dies First?

Posted by Nina Whitehurst | Jun 01, 2022 | 0 Comments

 

When one spouse is in a nursing home and applying for Medicaid, planning has to take into account the possibility that the spouse who is not in the nursing home (called the "community spouse") may pass away first. This is because the community spouse's death may make the spouse in the nursing home ineligible for Medicaid.

In order to qualify for Medicaid, a nursing home resident can have only a limited number of assets. Careful planning can allow the resident's spouse to maintain some assets. However, if that community spouse passes away first and leaves those assets to the nursing home resident, the resident suddenly would be over Medicaid's asset limit.

While the community spouse can write a will that disinherits the Medicaid resident, most states have laws that allow spouses to claim a portion of their deceased spouse's estate regardless of what the will says. This is called the elective or statutory share. The amount the spouse can claim varies from state to state.

A spouse can disclaim his or her elective share, but if a Medicaid recipient disclaims the inheritance, it is considered an uncompensated transfer of assets and the recipient may receive a period of Medicaid ineligibility. To avoid this, the community spouse will most likely need a will that addresses this issue. One option is for the community spouse to create a will that leaves the nursing home spouse exactly the amount of the elective share. Another option may be to create a special trust that contains the elective share.  We can help you determine the best course of action for you and your spouse. 

 

About the Author

Nina Whitehurst

Attorney at Law Nina has been practicing law for over 30 years in the areas of estate planning, real estate and business law She is currently licensed in Alaska, Arizona, California, Colorado, Oregon and Tennessee. Her Martindale-Hubbell attorney rating is the highest achievable: 5 stars in peer...

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