How The Stimulus May Affect Your Medicaid Eligibility – And What You Should Do About It

If you are a senior on Medicaid who is receiving care in a long-term care facility, it is likely that under COVID-19 legislation you have been receiving stimulus payments as part of the relief package. The stimulus money is different because according to Medicaid rules it is not viewed as income. But as we approach the anniversary of the first wave of payments, that will change. Here’s what you should know.

Do Stimulus Checks Affect Medicaid Eligibility?

The short answer is no, at least not immediately. The idea behind the stimulus is to make sure that you are supported financially and have your basic needs met. So that means you should spend the money on anything you need or have been holding off on buying. According to COVID-19 legislation, long-term care residents are not required to hand their checks over to the facility, nor are the checks counted as income, so in some regards can be looked at as “free money”.  If you spend it, it’s almost like you never had it. But if you have been hanging on to it, it’s time to make some decisions on how to proceed so it doesn’t affect your eligibility.

What If My Facility Asks For My Check?

In early 2020 at the beginning of the pandemic there were a lot of questions around the stimulus payments for seniors in long-term care. There were reports of some facilities requesting their residents to hand over their checks, presumably as a measure to help residents avoid the checks being counted as income. 

But as the intervening months have brought clarity to the details of the stimulus package, there is no longer a question that the checks are meant for the recipient only, and that includes those on Medicaid. If you are being asked to turn over your stimulus check, the FTC (Federal Trade Commission) advises you to file a report with them here, and contact your state attorney general as well. 

How Can I Avoid Penalties?

Simple: spend the money. Upon the one year anniversary of each stimulus check being sent, if you’re still in possession of it, the money is looked at as an “asset”, or “resource”. So if it hasn’t made its way through your bank account within a year, and it puts you over the “resource threshold”, it could make you ineligible for Medicaid. 

What Should I Do With My Stimulus Payments?

It’s important to ensure that your needs are being met… that the stimulus is doing its job in supporting you financially. Outside of that, how you spend the money is totally up to you. Here are some ideas on how to make that cash work for you.

• Use some of the money to top up your bank account(s) to the highest possible resource limit(s). 
• Think of any durable goods that you need right now or will need soon. Things like new kitchen appliances, a washer and dryer, television and stereo equipment may be purchased now. 
• Get some personal care items and procedures handled. Get your teeth cleaned, take care of that dental implant, stock up on medical supplies, get some new reading glasses, or upgrade to laser eye surgery and spring for some new Wayfarers instead. 
• Hire a professional. Maybe you have been putting off a meeting with a financial advisor, or could use the support of a counselor. Now is the time! Take art or language lessons, hire a personal trainer, or learn to sing and play guitar like you always wanted. 
• Donate to a cause that matters. Gifting does count as one of the acceptable ways to use the money. Perhaps it would be best used to brighten someone else’s world.

No matter how you choose to spend your economic stimulus checks, the most important thing to keep in mind is that it’s there for your support and wellbeing. And there is no advantage at all in waiting until the last minute to do something with it. With a little bit of planning, you can make this windfall work for you, and maintain your Medicaid eligibility too.