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⭒ CANHR Advocate Did You Know Articles

Spousal Impoverishment Protections

When a person who is married or have a registered domestic partner enters a nursing home or participates in a Home and Community Based Services (HCBS) program, the couple will benefit from Spousal Impoverishment protections that allows the spouse that is not on Medi-Cal to keep additional assets and income to prevent them from running out of money. The spouse that is not on Medi-Cal is known as the community spouse. These protections allow the community spouse to pay for food, rent, mortgage, or other bills necessary to continue living at home. If the community spouse also needs Medi-Cal, they may lose some, or all, of the income and asset protections offered under spousal impoverishment.

When the second spouse (community spouse) applies for Medi-Cal, their application is processed as if they are in their own household, subjecting them to the asset limit for a single individual ($130,000 effective July 1, 2022). The other spouse that already receives Medi-Cal will continue to receive their benefits, but some Spousal Impoverishment protections no longer apply. For example, the community spouse cannot keep the Community Spouse Resource Allowance (CSRA) and must maintain the asset limit for a single individual. Income allocation may also be removed if the community spouse receives certain services under Medi-Cal.

If the community spouse participates in a HCBS program or enters a nursing home, Medi-Cal deems them as “institutionalized,” and they will no longer be considered a community spouse. The newly institutionalized spouse cannot receive income allocations in this scenario and may be subject to a share of cost depending on their monthly income and whether they enter a nursing home.

On the other hand, if the community spouse uses their benefits for services unrelated to HCBS or does not enter a nursing home, Medi-Cal will allow only income allocations to continue, but the recipient must consider how this may affect their share of cost because the income allocation will be added to the community spouse’s countable monthly income.

For the guidance on this rule, please refer to ACWDL 18-19, page 13, number 6.