If you or your loved one needs long-term care in the nursing home or assisted living facility (ALF) in Florida, Medicaid can help pay for the elder's stay, if the elder qualifies following a strict set of rules. The Medicaid rules generally say that the applicant:
- Must be a Florida resident
- Needs long-term care in a skilled nursing facility (or ALF, in certain situations)
- Assets and income under the applicable Medicaid limits
- They did not give assets away within the five year look-back period
- They correctly apply for Florida Medicaid
Some of the toughest and most confusing rules revolve around income and asset levels. Broadly, a married couple is allowed to have about $150,000 (2023) in countable assets but a single person is only allowed to have $2,000 in countable assets. Income must be below the applicable income limits as well. See the links to the above articles for income and asset limits, which change annually.
But what do you do when the elder is in the nursing home and the assets are over the limit? We generally refer to this as "spend down" planning. Spend down planning can help make sure the elder's assets do not disappear to the high cost of nursing home care, which can exceed $12,000 per month in Florida. Remember, if the elder needs to be in the nursing home, the family will likely want to make sure the elder's assets are spent effectively as the money will certainly go fast. The general rules for spend down planning are as follows:
- You cannot give money/assets away! This is one of the biggest rules. Transfers of assets creates a transfer penalty.
- Anything sold must be sold for fair market value. You cannot sell your home to your daughter, for instance, for $1.00 (we get that question a lot!)
- You can legally spend money for the elder's care and for personal items
- You can spend money on the elder's homestead property, even if they do not live there
- You can purchase irrevocable funeral contracts and burial plots
There are a lot of issues and concerns on correctly spending the assets. When applying for Medicaid, you need to document all expenditures over a certain amount (usually $200). Medicaid will look at all bank and financial statements 3 months before applying and will want documentation of large expenditures.
If you want to protect assets, good elder law attorneys (like us, of course) know ways to legally protect the elder's assets and apply for Medicaid. We have more information on Medicaid spend down planning on this page. We also have more information on Medicaid asset protection planning here. If your elder just went to the nursing home due to a fall or other downturn in health, you will want to read more here.
If you want to learn more about Medicaid and assisted living planning, please follow this link.
The big picture is that a good elder law attorney should be consulted in any given situation. You would also want to make sure the elder has done his or her incapacity planning and estate planning, naming a trusted family member as attorney-in-fact (i.e., the durable power of attorney), who can help protect the elder's assets.
Over the Income Cap? You may need a qualified income trust.
See our FAQ's for more information on Medicaid, Spend Down planning and more in Florida.
Read our Free Book!
If you or your loved one is in a nursing home now or you are looking for ways to protect assets from the high cost of long-term care, please download a copy of our book Don't Lose Your Nest Egg to a Florida Nursing Home.