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Married Applicant Case Study

Meet Martin and Jane

Meet Martin, 82, and Jane, 79. Martin has been living at home with Jane, who has been acting as his primary caregiver. However, Martin’s health has been on the decline for several months, and Jane can no longer give him the proper care he needs.

Martin has been suffering from dementia for several years. He now needs assistance with several Activities of Daily Living (ADLs) as defined by Medicaid: he needs help with dressing, toileting, and transferring.

Although Martin and Jane have saved money over the years and have been savvy investors, Jane knows that the $10,500 cost of a Nursing Home facility will quickly drain their assets.

Jane’s primary concerns are the following:

  • Martin’s income is $3,000 – over the income limit for their state
  • Jane’s income is only $1,000 – which will make paying the monthly expenses difficult
  • Martin and Jane’s household assets are $125,000 – well above the asset limit for Medicaid in their state
  • Besides their primary household valued at $200,000, they also own a small rental property worth $75,000.

Jane doesn’t know where to turn for help, so she enlists a group of Certified Medicaid Planners.

$ 68000

Worth of Assets Preserved
Thanks to Eldercare Resource Planning


  • Secure Medicaid eligibility for Martin.
  • Ensuring Jane’s has the financial resources (income and assets) to support herself and live independently.


Jane decided to enlist the help of ECR Planning’s Certified Medicaid Planners in order to make sure that she submits the application correctly on the first attempt. This way she can preserve the assets she needs for herself while making sure that Martin becomes eligible for Medicaid.

She will also avoid unnecessary stress and frustrating bureaucratic delays, and save the out of pocket costs on Martin’s ongoing care if they were to make a second attempt at the application.


A Certified Medicaid Planner will need to identify the entire household worth, the way Medicaid will view it. Altogether, Martin and Jane have $200,000 in countable assets. The primary household will be an exempt asset during the Medicaid application, but the rental property will not. A CMP will help identify any other countable or non-countable assets, such as IRAs, land rights, retirement income, etc.

Per the Community Spouse Resource Allowance (CSPA) in their state, Jane is allowed to keep $128,640. However, their state is also a 50/50 state concerning the rules of Medicaid. This means that Jane is only allowed to retain $100,000 of the total countable assets. This means Jane can keep the rental property as well as an additional $25,000 in cash.

Martin, as stated by Medicaid, must demonstrate assets of $2,000 or under. This means that the remaining $98,000 must be “spent down” for Martin to be eligible for Medicaid.

Jane & Martin’s Countable Assets = $200k

Jane’s allowed 50% ($100k)

Martin’s allowed $2,000

=$98,000 spend down

Financial Tools

So with $98,000 that must be “spent down” before Martin can become eligible for Medicaid, typically the nursing facility or state caseworker would simply suggest Martin pay out of pocket until he is below the asset limit. AKA, pay his hard-earned savings toward the nursing home for the next 9 or 10 months and then apply for Medicaid.

However, there is another strategy that Medicaid does not advertise. This would be a product Jane could purchase immediately with the remaining $98,000 and make Martin eligible for Medicaid today. This product is called a Medicaid Compliant Annuity (MCA).

A Medicaid Compliant Annuity is a special type of annuity that turns countable assets into income. It must be set up accurately with the correct wording. A Certified Medicaid Planner is authorized to help you get the right MCA to fit your needs and avoid any Medicaid penalties.

In Jane’s case, she decides to set up a 3-year annuity. This means that in addition to the $1,000 income she’s currently receiving in Social Security, she will also receive a steady $2,722.22 every month for the next 3 years. Depending on her state of residence, Jane may also be entitled to a portion of Martin’s income.

This is all to ensure that Jane can live comfortably and independently while expediting Martin’s eligibility with Medicaid. They did not have to forfeit nearly $100k to a facility, which is great news.

$98,000 that must be spent down

÷ 3 years of annuity product = $32,666.67

÷ 12 months to a year = $2,722.22/month (Jane’s estimated additional income excluding interest)

Additional Options

Let’s say that Jane and Martin still owed $50,000 in mortgage payments on their current house. Depending on the situation, some or all of the spend-down might be used for this purpose. The $98,000 dollars that must be spent down for Martin to become eligible can be used on various things outside of an MCA. However, it is essential that the spend down is done carefully, in a timely manner, and not spent on anything that will incur a Medicaid penalty. A Certified Medicaid Planner can explain what is and is not allowable under Medicaid in your state and how to avoid Medicaid penalties that could result in financial devastation.


$ 68000

$98,000 worth of assets preserved thanks to the help of Eldercare Resource Planning.

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