Every Married Couple Needs to Understand what a “Snapshot” is and Why it Matters in Medicaid Planning
In the Medicaid world, when I say “we need to get a snapshot,” I sometimes think my clients wonder where the camera is. Then, when we are done talking about this particular issue, I think we both feel as though it would be easier if we were talking about a Polaroid. The Medicaid snapshot is a very important concept for married couples, and it’s also very confusing. This article is to help you make sense of it. In the end, you will see why it is very important to understand how important the snapshot date can be for your financial future.
An explanation of basic Medicaid “spousal impoverishment” rules.
When a couple is married, and one spouse needs nursing home care, or care in the community through Wisconsin’s alternative to nursing home care called “Family Care,” Medicaid will provide coverage of the cost of care if the couple meets financial eligibility rules. These rules are commonly referred to as “spousal impoverishment” rules but actually, that is a misnomer. The current set of rules regarding eligibility for married couples is based on federal law that was put into place by Congress to prevent spouses from becoming impoverished if only one needed nursing home care. Therefore, they really aren’t “spousal impoverishment” rules, they are spousal anti-impoverishment rules. But they are called “spousal impoverishment.”
The spouse applying for benefits is called the “institutionalized spouse” – whether in a nursing home or applying for Family Care. The spouse who is not applying, and lives in the community – is called the “community spouse.” The “institutionalized spouse” could also be referred to as the “nursing home spouse” and I usually use that term when we are discussing Medicaid benefits in a nursing home.
Side Question: Why would a spouse applying for Family Care be called an “institutionalized spouse” when the whole point of Family Care is to keep people out of institutions by providing care and services in their homes? Answer: Because that’s just the way it is in order to apply the same rules. Don’t try to find logic in it.
Assets: Under spousal impoverishment rules, the allowable amount of assets that the couple can have to qualify for Medicaid is called the “community spouse resource allowance” or CSRA. The CSRA is going to be a specific number. As of the posting date for this article, that number will in most cases be somewhere between $50,000 and $126,420, plus $2000 for the nursing home spouse. (In exceptional cases there can be adjustments through a hearing process.) The upper number changes every year. The trick is understanding how Medicaid comes up with the exact number that applies to the couple. And this is where the “snapshot” concept comes in.
Income: There are also rules related to spousal impoverishment income. These rules say that once the nursing home spouse is eligible (based on meeting the asset test described above), he or she may in some cases be able to transfer a certain amount of income every month to the community spouse. But today we aren’t here to talk income. Because the snapshot is all about assets.
Now getting to the point – explaining the “snapshot”
In a nutshell, the “snapshot” is the amount of assets the couple had as of a particular date in time prior to the time they applied for Medicaid. That date is called the “snapshot date.”
Snapshot date: The snapshot date is a specific date in time that is very important, but that most couples – at least those who have not read this article – have no idea is so important. In Medicaid legalese, its official name is the “first continuous period of institutionalization.” You can see why we would rather call it the snapshot date. Figuring out what date is actually the snapshot date is done two different ways – depending on whether the person is applying for institutional Medicaid or Family Care.
Institutional Medicaid Snapshot Date: For institutional Medicaid (nursing home or hospital) cases, the snapshot date is the first day that the person went into a medical institution for 30 days or more. This is usually a nursing home, but a hospital can be a medical institution also.
For example, if Georgio had a stroke on March 1, 2019, and went into the hospital that day, stayed there for a week, and then went directly into a nursing home for several months, the snapshot date would be March 1, 2019. The key is that there needs to be a “continuous” period of institutionalization. If Georgio went home after his week in the hospital, stayed at home. then went into the nursing home on March 11th (a couple of days after going home,) the snapshot date would be March 11th – assuming he did spend 30 days or more in the nursing home.
It’s also important that the snapshot date is the first continuous period of institutionalization so if Georgio had been in a nursing home for some reason two years before his stroke, from August 10, 2017 -September 25, 2017, then the snapshot date would be August 10, 2017, even if no Medicaid application was done at that time. For people whose first continuous period of institutionalization is several years in the past, it can be difficult to recreate financial records.
So remember, for institutional Medicaid the snapshot date is the:
FIRST – must be the first time person was in the hospital/nursing home for 30 days or longer
CONTINUOUS – must not have a gap such as a return home
PERIOD OF INSTITUTIONALIZATION – this means 30 days. Whether in a hospital, a nursing home, or a combination.
Family Care Snapshot Date: For Family Care, the snapshot date has nothing to do with a stay in a nursing home! It is the date that a functional screen result concludes they met the “functional” requirements for Family Care. The functional screen results come on a paper that is dated. The date on that paper is the snapshot date.
In Family Care cases, many couples do not understand how the functional screen affects their financial future because it sets the snapshot date. This is something families need to get educated about. This screen is typically performed by someone from a local county’s Aging and Disability Resource Center (ADRC). Because this article is focused on the snapshot date, I will not explain this test in a whole lot of detail right now, except to say it is a complicated but necessary part of the Family Care application process. I typically spend part of an initial appointment with clients explaining it. What I do want to stress in this article is that the timing of that functional screen is more important than most people realize.
To make it a little more confusing, whichever of these two situations took place first can be used as a snapshot date. In other words, if a person in a nursing home for the first time had a functional screen a couple years ago, that date will be the snapshot date. If a person requesting Family Care was in a nursing home for 30 or more days, the date of that nursing home admission will be the snapshot date.
The Snapshot: The snapshot is the amount of countable assets the couple had on the snapshot date. (Oh now we are getting to the point!) Remember in the section a few paragraphs ago when I explained spousal impoverishment assets? Well, figuring out how much the couple gets to keep is based on the snapshot. For the snapshot, we add up everything the couple owned – on the snapshot date – that would be a countable asset for Medicaid. This includes bank accounts, stocks, bonds, vehicles – except one, real estate that is not the home, cash value life insurance with a small exception, and most other liquid assets. Assets in the name of either spouse are counted, even if the spouses have a marital property agreement in place between them. The house is not counted in this total in most cases. A few other things are not counted also, such as retirement funds that belong to the community spouse. An elder law attorney can help you understand more about what assets are and aren’t counted.
Once all of those countable assets are added up to make the snapshot, the spousal impoverishment formula says you get to keep half of those assets – but must not go higher than the highest number in the asset range (currently $126,420.)
Examples: If a couple has $120,000 on the snapshot date, their asset level in order to qualify for Medicaid will be $60,000. If a couple has $200,000 on the snapshot date, their asset level will be $100,000. Because of the rules regarding minimum and maximum, if a couple had $80,000, even though the general formula of “half” would be $40,000, that would be less than the minimum of $50,000, so in that case, the target for the couple is $50,000. Similarly, due to the maximum, if a couple has $500,000 on the snapshot date, their target level will be $126,420 even though that is far less than half. In all of the above cases, the institutionalized spouse also gets to keep another $2000.
This leads to the phrase I repeat to my clients until they “get it”: Half of more is more, half of less is less. The more you have on the snapshot date, the more you get to keep!
Helpful tips: All of this boils down to the fact that you need to understand why the snapshot matters. Now that you know what the snapshot is, you can do a few things. Of course, the amount of hospital/nursing control you have depends quite a bit on whether you can control the snapshot date. In some cases, such as a stroke or other emergency hospitalization that leads to a long period of care, you have no control.
Keep records when a loved one goes into a hospital or nursing home. Preserve records regarding the date the person went into the hospital or nursing home, and if it turns out the stay in hospital / nursing home is more than 30 days, make a folder with all of the person’s assets on the snapshot date. Bank and brokerage statements, insurance statements, stock records, vehicle description / blue book value, etc. Keep that folder as long as the spouse is alive.
If you believe your spouse will need long-term care, for example, if your spouse has recently been diagnosed with dementia, make sure you see an elder law attorney before you are too far down the road so that you learn what you can do – if anything – to maximize your snapshot.
If your assets are between $100,000 – $253,000, understand you are in the zone where the more you spend before a snapshot date, the lower your snapshot will be. It is particularly important that you be strategic about your situation if you have any control over it.
If you are considering Family Care, you will want to make sure all of your ducks are in a row before getting that functional screen, particularly if you are one of the couples whose countable assets are within the range between $100,000 and about $253,000. Couples in that target range will want to make sure they do not spend money on discretionary big-ticket items before getting the screen.
There are things you can do proactively to raise the level of your assets in anticipation of that snapshot. You really need to talk to a lawyer to understand all of these options and to be smart about the process.
If a nursing home social worker or billing person, or government employee tells you “you need to spend down to $50,000 and then you can get Medicaid,” do not immediately believe that statement. See my article here.
