When someone applies for Medicaid the caseworks completes an application form and collects a lot of records – both identifying and financial information. It then takes a number of weeks, months or even years for Medicaid to review the application and provide their result. So, the question is what is Medicaid looking for all that time? There are a number of answers to that question. Here are some of them.
Medicaid is Understaffed – There simply aren’t enough caseworkers to keep up with the demand for benefits. The Medicaid caseworkers mean well and want to help people but they are doing intake all day long with with very little time to review the applications they receive. They have to examine a lot of materials for each application and that takes a lot of time. It is actually amazing how thorough they are in their reviews of each application given the circumstances of what they are doing.
Citizenship – Medicaid checks to make sure the applicant is eligible for benefits. Is the person who they say they are? Are they applying in the correct state and county? Before someone can be found eligible for benefits they must show that they are eligible individuals and applying in the right place.
Marital Status – The applicant must prove that they are or aren’t married. Marital status plays a big role in determining what assets can be kept so Medicaid needs to verify that there is or isn’t a spouse and that all of the money belonging to both spouses is being disclosed and accounted for.
Resources – Medicaid looks to see that you are financially eligible for benefits. They make sure you don’t have more resources – both liquid assets like money in the bank – and other specific resources that Medicaid will allow an individual to have.
Income – Technically there is no amount of income in New Jersey that will disqualify you from nursing home or assisted living Medicaid eligibility but there are some traps that relate to income. You may need a qualified income trust or your income may exceed the amount Medicaid will pay to the community on your behalf.
Spending Money – Medicaid examines how your loved one spent his or her money during the five years prior to applying for benefits. That five year period is the look back – commonly called the Medicaid five-year look back. Medicaid checks to see that your loved one spent their money for their own benefit (or for the benefit of their spouse if they are married) and received a fair market value in exchange for every dollar spent. If they received less than fair market value for the money they spent then Medicaid would consider that a gift and gifts that don’t qualify for a Medicaid gifting exception will be penalized.
Gifts – Medicaid doesn’t like gifts. They want you to spend your money on you for the care you need or your own personal benefit and they don’t want you to give it away. If you give money away (and this includes receiving less than fair market value in exchange for money paid or received) then you have less money available to spend on your care and Medicaid will penalize those gifts.
In conclusion, these are some of the things Medicaid looks for when they review someone’s application. This is not everything and it is not a detailed discussion about these items. It is an overview meant to answer the question, “what takes Medicaid so long to approve my loved one’s application for benefits?” If you have questions about your specific situation you should contact an elder law attorney.