Impact of COVID-19 Stimulus Checks on Medicaid Eligibility
The CARES Act (the Coronavirus Aid, Relief, and Economic Security Act passed on March 27, 2020) is intended to provide direct assistance to American businesses and individuals during the massive financial crisis caused by the COVID-19 pandemic. As part of the CARES Act, many Americans qualify to receive a stimulus check from the Internal Revenue Service. The stimulus checks are intended to help individuals pay for their basic necessities during the pandemic and to help offset the negative impact of the pandemic on the American economy.
Receipt of this stimulus check has caused concern among many individuals who currently qualify for Medicaid or who anticipate needing to qualify for Medicaid in the near future. Medicaid is a needs-based government benefits program that assists people with such things as nursing home, assisted living, and health care costs. Many current Medicaid recipients have concerns that the stimulus check each receives will put them over the asset or income limitations of the Medicaid program, causing them to lose their Medicaid benefits. Those who are applying for Medicaid have a similar concern that the stimulus check will cause them to fail to qualify for much needed Medicaid benefits. Medicaid ineligibility caused by the stimulus checks would likely be a catastrophic financial loss for most Medicaid recipients and applicants.
Medicaid recipients and applicants can now rest assured that the stimulus checks will not immediately disqualify them from Medicaid eligibility. We now have clarification from the government that the stimulus checks will not be counted as income and, therefore, will not push Medicaid applicants and recipients over the Medicaid income limit. In addition, the stimulus checks will not be counted as assets for up to twelve months following receipt of the check. Therefore, a Medicaid recipient or applicant can possess the stimulus check assets for up to twelve months following receipt without impacting Medicaid eligibility.
For one already qualified and receiving Medicaid, receipt of a stimulus check by that Medicaid recipient’s spouse should also have no impact on the eligibility of the Medicaid recipient. Furthermore, the Medicaid recipient’s spouse should not be required to spend his or her stimulus check funds during the twelve months following receipt so that the Medicaid recipient will maintain eligibility. The Medicaid recipient’s own stimulus check, however, may need to be spent during that one-year grace period, in which case it will need to be spent in a manner that does not jeopardize the recipient’s Medicaid qualification. After that time, it will be counted towards the Medicaid asset limit and could cause Medicaid disqualification.
For those applying for Medicaid, the stimulus check of the applicant or the applicant’s spouse will not count toward the applicant’s income or asset limit if properly spent within twelve months of receipt. Receipt of the stimulus check, whether by an applicant or by an applicant’s spouse, will therefore not immediately cause an applicant to be denied Medicaid benefits, but both checks may need to be appropriately spent within twelve months of receipt in a manner that does not cause Medicaid ineligibility.
This is all good news for Medicaid applicants and recipients during this COVID-19 pandemic. However, those currently qualified for Medicaid or anticipating the need to qualify for Medicaid would be well-served to seek the counsel of an experienced elder law attorney to determine how they might properly spend the stimulus check funds in order to qualify for Medicaid or to maintain eligibility for Medicaid after the twelve-month grace period has expired.