Home Value Issues
Medicaid rules involving a primary residence are complex with some rules involving initial eligibility with others relating to Medicaid lien provisions. In many cases, the primary residence is an exempt asset not counted as part of the $2,500 (applicant) and $109,560 (community spouse – maximum) threshold. However, in many cases it is counted. One of the relatively new changes enacted by the Deficit Reduction Act of 2005 and adopted by Maryland in 2007 was an equity threshold test. A home with an equity value equal to or exceeding $500,000 is a fully countable asset. Not a good answer. The good news is that there are still methods to protect the house.
From a Maryland perspective, Medical Assistance (i.e. Medicaid) only allows one gravesite per person to be exempt. If there is a community spouse, then that community spouse is also only allowed to have one. If there is more than one per person, it is a fully countable asset for Medicaid purposes and the application may be denied.
Asset Levels for Maryland Medicaid
For Maryland purposes, the Medicaid applicant can have no more than $2,500 in countable assets while the community spouse can have no more than $126,420 (can be less) in countable assets. There are many instances where the community spouse will have a lower asset threshold. The key is what is a “countable asset.”