Many people as they age choose to have a trusted person, such as their child, added as a joint owner of their bank account to help manage their day-to-day finances. This arrangement is perfectly acceptable, however, those who plan on applying for MassHealth (Medicaid) benefits should be careful about how they use and document joint accounts.
According to the MassHealth eligibility rules, when a MassHealth applicant is a party to a joint bank account, all of the assets in the account are considered available to the applicant and therefore countable for eligibility determination. That means that if the child or other joint account holder were to make a deposit into the account, those funds could be counted against the MassHealth applicant. If the applicant claims only partial ownership of the account funds, they must be able to fully verify the amount owned by each joint depositor. Only after this verification will MassHealth attribute ownership proportionately between the joint account holders.
Any asset, other than a joint bank account, that is owned by two or more individuals (including the MassHealth applicant) is considered to be owned in equal shares and counted proportionately, unless a different distribution of ownership can be verified.
For these reasons it is important for potential MassHealth applicants to keep detailed ownership verification documents for any joint account or jointly held asset. Failure to do so can result in the applicant being unfairly penalized and forced to pay privately for a portion of their long term care. An estate planning attorney can help you organize your finances and guide you through the complex guidelines involved in a MassHealth application.