Long-Term Services Health Reform Provisions:
Expanded Spousal Impoverishment Protection in Medicaid
What it is
Today, when one member of a couple is receiving long-term care in an institution, states are required to allow the community-dwelling spouse to retain a certain amount in assets and income without affecting the Medicaid eligibility of the spouse living in the institution. This means that both members of a couple do not have to become impoverished for one to receive long-term services in Medicaid. Until health reform, this protection did not apply if the spouse needing care was not institutionalized. With health reform, states will be required to extend the same spousal impoverishment protections that apply to institutional care to home- and community-based care. This provision becomes effective in 2014 and applies for five years.
Why it is important
As long as spousal impoverishment protections only apply to the cost of nursing facility care, couples may have to make the difficult decision to move the spouse needing care to an institution so that the spouse not needing long-term care is not impoverished. That not only means that the person receiving care might be getting that care in the less restrictive setting, but can ultimately cost the state more money, since institutional care is typically more expensive than community-based care. Extending spousal impoverishment protections makes sense and helps put HCBS in Medicaid on an equal footing with institutional care—at least for the five years this provision is in effect.
