Supreme Court Upholds Medicaid Assets Limit for Nursing Home Spouses
The Supreme Court yesterday ruled that states may continue to require spouses of nursing home residents to deplete some of their financial resources before those residents can qualify for Medicaid, the Washington Post reports. By a 6-to-3 vote, the court held that the "income-first" method of determining Medicaid eligibility does not violate a 1988 federal law, the Medicaid Catastrophic Coverage Act, intended to prevent elderly couples from "having to impoverish themselves" before they could receive Medicaid coverage for nursing home care (Lane/Goldstein, Washington Post, 2/21). A second intent of the law was to prevent nursing home patients from transferring all of their assets to their spouses in order to receive Medicaid benefits to which they would not otherwise be entitled. The income-first approach, in which the spouse of a Medicaid recipient in a nursing home is allowed to retain only a home, a car and $86,000 of a figure that was increased over the years in assets, is used by about 30 states (Manning, Milwaukee Journal Sentinel, 2/20).
The ruling stems from the case of a Wisconsin couple. After Irene Blumer entered a nursing home in 1994, local officials said she and her husband Burnett had to reduce their assets from nearly $90,000 to about $75,000 before Medicaid would cover her care. The Blumers challenged the decision, and the Wisconsin state Court of Appeals ruled that the income-first approach violated the 1988 federal law. But writing for the majority, Justice Ruth Bader Ginsburg said that there is "no conflict" between the law's goals and the income-first method. She stated, "Eliminating a state's discretion to choose income-first would hinder the state's effort to strike its own balance in implementing Medicaid." The Post reports that the ruling "essentially ratifies the existing legal situation" but "spare[s] states a large new expense." Medicaid covers almost half of all nursing home costs, which in turn account for about 25% of overall Medicaid spending. The decision will also allow HHS to move forward with a regulation proposed last September by Secretary Tommy Thompson that would "explicitly give states the freedom to determine eligibility for married nursing home residents based either on the income-first method or a different one in which states consider a broader range of assets" (Washington Post, 2/21). The court's opinion in Wisconsin Department of Health and Family Services v. Blumer is available at online. Note: You will need Adobe Acrobat Reader to view the opinion.This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.