Ronald Fatoullah & Associates - Elder Law

Spousal Refusal Budgeting


As some in the field of Medicaid benefits are aware, the local Medicaid agency in New York City recently seemed to have changed its policy regarding spousal refusal cases. This change resulted in the Agency failing to include in the budgets of institutionalized applicants an allocation of income to the community spouse in spousal refusal cases. In other words, if a community spouse executed a spousal refusal (because his or her resources exceeded the maximum statutory level of $74,820 to $117,240), Medicaid was not allowing that spouse in the community to retain enough of the institutionalized spouse's income to bring him/her up to the Minimum Monthly Maintenance Needs Allowance (MMMNA: $2,898 in 2013 and $2,931 in 2014).

A recent fair hearing decision addressed the issue and the decision is favorable to community spouses who are experiencing a similar situation. The Appellant's community spouse received his own income of $1,978.78, which was $872.82 below the MMNA. In calculating the Net Monthly Available Income (NAMI) of the institutional spouse, the Agencydid not deduct any amount from the institutionalized spouse's income to be contributed to the community spouse. Hence, the hearing was requested.

As quoted in the hearing, Pursuant to Administrative Directive 91 ADM 33, districts must determine entitlement to the CSMIA [Community Spouse Monthly Income Allowance] without regard to the amount of resources owned by the community spouse, other than to determine the amount of income generated from those resources. A community spouse who refuses to make his or her resources which exceed the maximum CSRA [Community Spouse Resource Allowance] available to the cost of care of the institutionalized spouse must be allowed the appropriate CSMIA."

Based upon that directive, a community spouse with income below the CSMIA is entitled to receive enough of the institutionalized spouse's income to bring him/her up to the CSMIA amount, currently $2,931, irrespective of whether he/she executed a spousal refusal. In other words, even if a community spouse's assets exceed the statutory levels and a spousal refusal is signed, a monthly income allowance is still in place to protect the community spouse. The institutionalized spouse's income should be allocated to the community spouse to reach the income allowance.

The decision states that the Agency was in violation of 91 ADM 33 by failing to deduct a CSMIA from the institutionalized spouse's income because of a spousal refusal. As such, the Agency was directed to adjust the budget to reflect a zero NAMI. That is, all of Appellant's net available monthly income was to be contributed to her husband in the community.

Given the long-standing policy expressed in 91 ADM 33 and the recent hearing, the issue of community spouses not receiving their rightful allocation of income should hopefully now be put to rest.

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