Will Your Stimulus Checks Affect Medicaid And SSI Eligibility?

Under COVID-19 legislation, a one-time direct payment of $1,200 was paid to individuals earning less than $75,000 per year ($150,000 for couples who file jointly), including beneficiaries of Social Security and Supplemental Security Income (SSI) benefits, Medicaid benefits and other public benefits based upon financial need. Individuals earning up to $99,000 ($198,000 for joint filers) received smaller stimulus checks. The Internal Revenue Service issued stimulus payments in the same way that recipients get Social Security benefits (direct deposit or a paper check by mail). Recently, new legislation was introduced under which additional stimulus checks will be issued.

Have the stimulus checks previously issued negatively impacted Medicaid recipients? If yes, will the issuance of additional stimulus checks continue to negatively affect recipients of Medicaid and SSI benefits?

The answer to both questions is “No.” Under a Policy Statement issued by the New Jersey’s state Medicaid agency, the Division of Medical Assistance and Health Services, a stimulus payment is not counted as income in determining financial eligibility for Medicaid benefits. Therefore, receiving a stimulus payment does not change a resident’s monthly income calculation under the Medicaid rules.

With regard to SSI benefits, the commissioner of the Social Security Administration (SSA) has clarified that the SSA will not consider stimulus payments as income for Supplemental Security Insurance (SSI) recipients.

Similarly, all stimulus payments DO NOT count as a resource under the Medicaid rules for 12 months. In other words, for the first year after receipt of the stimulus checks, the payments cannot cause Medicaid recipients to be terminated from the Medicaid program due to “excess resources.”

If the stimulus payments have not been spent after 12 months, the funds will count as a resource in determining eligibility under both programs. Recipients can spend the stimulus payments in any way they wish.

Importantly, the Center for Medicare and Medicaid Services (CMS) has indicated that the gifting of stimulus funds WILL NOT count as a transfer of assets during the 12 months following the receipt of the funds. However, if transferred after 12 months, the transfer would be considered a gift under the Medicaid and SSI rules and would impact eligibility. This policy of not counting gifts of stimulus funds applies to both the Medicaid and SSI programs.

If a competent recipient wants the stimulus payments to be managed by an agent under a Power of Attorney (POA) or person designated by the resident, the designee or POA can manage the funds and make purchases for the recipient. The POA or designee must utilize the funds according to the wishes of the recipient, and can assist the recipient in making purchases of goods and services or making gifts to friends and family.

For incompetent recipients who are residents of long-term care (LTC) facilities and have no POA, designated representative or anyone from outside the facility who is actively engaged in their lives, the LTC facility may utilize the stimulus funds for the purchase of items that the resident might need, like clothing or shoes, and also for items that might bring the resident comfort or pleasure, like a new blanket, art, edible treats or an MP3 player.

At the resident’s direction, LTC facilities can deposit stimulus funds in the resident’s Personal Needs Allowance account. However, all spending from that account is directed by the resident and may not in any way be controlled by the facility.

The Policy Statement is attached here – [gview file=”https://vanarellilaw.com/wp-content/uploads/2021/01/Gifting-Stimulus-Check-003.pdf”]

For additional information concerning Medicaid and public benefits planning, visit:

NJ Medicaid and Public Benefits Planning