To qualify for MassHealth benefits, seniors must meet strict financial eligibility requirements. This includes both a limit on countable assets as well as income. In 2011, the monthly income limits for seniors seeking MassHealth benefits is $522 for an individual, $650 for a couple, and $72.80 for residents of long-term care facilities. However, seniors age 65 or older and individuals needing long-term care, who would qualify for MassHealth except that their income or assets are too high, can become eligible by meeting a deductible and/or spending down their assets.
Determining Your Countable Income
MassHealth counts the following types of income for eligibility purposes:
- Wages, salary, tips, commissions (before deductions)
- Self-employment income (minus expenses)
- Social Security benefits
- Railroad Retirement benefits
- Pensions and annuities
- Federal veterans’ benefits (minus allowed exclusions)
- Interest and dividends
- Rental income (minus expenses)
MassHealth does not count the following types of income:
- Income received by a TAFDC, EAEDC, or SSI recipient
- Income in-kind (non-cash payments)
- Sheltered workshop earnings
- The part of veterans’ benefits identified as aid and attendance benefits, unreimbursed medical expenses, housebound benefits, or enhanced benefits
- Any other income that is excluded by federal laws other than the Social Security Act
In addition, MassHealth disregards the following types of income for people age 65 or older, or for people of any age who would be institutionalized without community-based services:
- $20 per month, plus
- $65 per month of earned income, and
- one-half of any remaining earned income
People of any age who are institutionalized can also get a standard deduction of $11 and may also deduct certain work-related expenses.
Determining Your MassHealth Deductible
Seniors age 65 or older who are eligible for MassHealth except that their incomes are too high, can still qualify for benefits by meeting a deductible. If your income is above the MassHealth income limits (see above) then you must pay for certain medical expenses before MassHealth will kick in. This amount is your deductible, and is calculated every six months while you are receiving benefits.
To calculate your 6-month deductible:
- take your monthly gross family income;
- subtract the monthly income limit for your family size;
- multiply this number by 6 (for six months).
In order for MassHealth to cover your medical expenses, you must show proof that your expenses in a six-month period are greater than your deductible amount. The higher your income, the higher your deductible. Once you meet the deductible, MassHealth provides coverage for any new covered medical expenses for the rest of the six-month period.
Spending Down Assets
One way for individuals needing long-term care to qualify for MassHealth when their assets are above the MassHealth asset limits, is to spend down their assets. However, MassHealth rules regarding transfer of assets must be carefully followed to avoid disqualification.
All asset transfers, including transfers to trusts, during the five years before you enter a long-term care facility must be reported to MassHealth. This is referred to as the “look-back” period.
Any asset transfers during the look-back period that do not follow MassHealth rules can result in a period of ineligibility for MassHealth. The length of time that you will be ineligible depends on the value of the assets you transferred and the date of the transfer.
You may spend down your assets within the look-back period without penalty, if you spend your money on non-countable assets or nursing home expenses. For example, you can spend your assets to fix up your home, pay down your mortgage, repair your car, or prepay your funeral expenses. However, you must receive fair market value for your money.