Devils, Details, and Deadlines: Performing the Attribution of Resources

Orange City Iowa Estate Planning

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We spend a lot of time on the blog talking about important terminology in elder law and estate planning. And the terminology is all well and good, but none of that matters if you can’t apply it to a real scenario. That’s what we’re going to do today: figure out the attribution of resources.

When figuring out the attribution of resources, you need to count all of the resources you own.

What is the Attribution of Resources?

The attribution of resources is the process Medicaid uses to determine how much a community spouse is allowed to keep and how much an institutionalized spouse must spend down.  For more information on attribution, click here.

The attribution process only applies if you are married. For a single person, your spend-down amount is 100% of your countable resources, minus your $2,000 individual resource limit.

But, if you’re married, the process starts with you disclosing all of the resources owned by you and your spouse as of the snapshot date.

After you submit your application and disclose all your assets, DHS works some “magic” on the information you submit. The end result is the spend-down amount for the institutionalized spouse.

Wait. Did You Say “Magic?”

Ok, it’s not actually magic. But sometimes attribution seems like sleight of hand if you don’t go into the process with eyes wide open.

The first attribution trick to be ready for is: the Medicaid rules treat all of a married couple’s countable resources as if each asset is owned 50-50 between the spouses. This allows the caseworker to split assets between the two spouses on paper even when only one spouse owns a particular resource.

Another attribution trick Medicaid uses is the community spouse resource allowance (CSRA). This range is applied once the assets are split (see trick number one) so that the community spouse only gets to keep half the assets if that amount falls within the range.

So it’s a 50-50 split. Unless it isn’t.

Great. Now you lost me.

Let’s peek behind the curtain to see how Medicaid performs the attribution trick.

  1. Total up all the countable resources, regardless of actual ownership.
  2. Divide that total by 2 to determine what assets “belong” to the community spouse.
  3. Compare the result to the CSRA range.

If an amount equal to half of the total countable resources falls between the bottom of the range (2019: $25,284) and the top of the range (2019: $126,420), then we have a true 50-50 split. The community spouse gets to keep half under the CSRA, and the “spend-down” amount is equal to the other half (minus the institutionalized spouse’s $2,000).

But if we fall outside the range something different happens. When 50% of the total is lower than the bottom of the range, the community spouse gets to keep asset equal to that floor.

If 50% of the total is higher than the top of the range, the community spouse only gets to keep assets equal to that ceiling.

That is not less confusing.

It’s Iowa’s application and interpretation of the federal Deficit Reduction Act. Did you think it would make sense? #sarcasm

Let’s look at some examples to try to clarify things:

    1. Assets within the CSRA range

Total countable resources: $75,000.00
Divided by 2: $37,500.00
CSRA: $37,500.00
ISRA: $2,000.00
Spend-down: $35,500.00

    1. Assets near the floor of the CSRA range

Total countable resources: $40,000.00
Divided by 2: $20,000.00
CSRA: $25,284.00
ISRA: $2,000.00
Spend-down: $12,716.00

    1. Assets above the ceiling of the CSRA range

Total countable resources: $300,000.00
Divided by 2: $150,000.00
CSRA: $126,420.00
ISRA: $2,000.00
Spend-down: $173,580.00

It’s starting to get clearer.

Now that the attribution is complete, there’s one more question to answer: is the institutionalized spouse eligible for Medicaid?

If you said, “Maybe?” then you answered correctly. In each of the examples above, the application would be denied because there are still countable resources that need to be spent down. But it is possible that an application would be approved at this stage if the couple’s total countable resources were lower than the floor of the CSRA range:

    • Total countable resources: $15,000.00
    • Divided by 2: $7,500.00
    • CSRA: $15,000.00
    • ISRA: $0.00
        • Spend-down:

      $0.00

All that work submitting an application and I’m still not eligible?

That’s right. Even after responding to Medicaid’s (multiple) requests for additional information, it’s highly likely that a married applicant will still be ineligible at the end of the attribution process.

We see it all the time. At the suggestion of the nursing home, many people unknowingly submit themselves to the attribution process simply by filing a Medicaid application when their spouse moves into the facility. The Medicaid office reviews the application and sends two notices: 1) notice that the application is denied and 2) the Notice of Attribution. Most people stop there. They think, “Well, we’re not eligible, so I guess we need to spend all our money at the facility.”

But that’s not the case. At Huizenga Law, our most common client is a community spouse who’s not sure where to turn or what to do next. We can help you efficiently apply for the attribution of resources, plan your spend down after you receive an attribution, and advocate for you throughout your dealings with the state Medicaid office. Don’t let that first Medicaid denial derail your retirement. Call us today at 712.737.3885 to schedule a Mutual Interview.

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