Do Medicaid recipients need to “spend down” their stimulus money?
In March 2020, the Coronavirus Aid, Relief, and Economic Security (CARES) Act authorized stimulus checks of up to $1,200 to most Americans, including Medicaid recipients. In December 2020, checks of up to $600 were issued, followed by another $1,400, in February 2021. In Virginia, Medicaid recipients can only have $2,000 in countable resources and remain eligible for Medicaid. There are also income limits for some people receiving Medicaid benefits. Thankfully, these stimulus checks are not considered income for Medicaid recipients, and the payments have also been excluded from Medicaid’s resource limits for at least twelve months.
Although the one-year deadline for spending down the first stimulus check has passed, the Families First Coronavirus Response Act provides that Medicaid benefits that were in place as of March 18, 2020, cannot be terminated even if there is a change in circumstances that would normally result in Medicaid ineligibility. The law states that the recipient’s Medicaid coverage must continue through the end of the month in which the Secretary of Health and Human Services declares that the public health emergency has ended. The public health emergency has been renewed many times and is currently set to end on July 20, 2021, but it will likely be extended again through the end of 2021.
However, at some point in the future, the deadline to spend down stimulus money will eventually expire. Medicaid recipients should not delay in finding ways to spend down stimulus money that has caused their resources to exceed $2,000. Stimulus money can be spent down in a variety of ways, including paying off debt, making repairs to your home, updating personal items such as clothing and furniture, purchasing medical equipment, and paying for dentistry and eye care, which are not covered by Medicaid.
It is important to remember that Medicaid recipients generally cannot make gifts or uncompensated transfers. The stimulus funds should be spent on items that can be used for the benefit of the Medicaid recipient and should not be given away or transferred to anyone else.
If you have questions about the best way to use your stimulus money while maintaining your public benefits, contact an experienced elder law attorney for guidance.
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Emily A. Martin
757-399-7506 | 252-722-2890
Emily A. Martin is a Shareholder of Hook Law practicing in the areas of elder law, estate and trust administration, estate planning, asset protection planning, litigation and dispute resolution, guardianship and conservatorship, long-term care planning, special needs planning and financial planning. To date, Ms. Martin has overseen over 100 guardianship and conservatorship matters. In addition to being admitted to the Virginia State Bar and North Carolina State Bar, she is licensed to practice before the Department of Veterans Affairs. Ms. Martin is a member of the National Academy of Elder Law Attorneys and Virginia Academy of Elder Law Attorneys. She is a graduate of the University of Mary Washington and Regent University School of Law. Prior to joining the firm in 2018, Emily worked as an estate planning and elder law attorney in Virginia Beach for several years.
- Elder Law
- Estate & Trust Administration
- Estate Planning
- Asset Protection Planning
- Guardianship & Conservatorship
- Long-Term Care Planning
- Special Needs Planning
- Financial Planning