Little noticed among its more famous provisions, the Affordable Care Act expanded impoverishment protections to the spouses of home and community-based services (HCBS) beneficiaries.  However, although the rules have been in effect since 2014, states have not always been in compliance, according to Justice in Aging (formerly the National Senior Citizens Law Center). 

States now have less of an excuse not to comply because the Centers for Medicare and Medicaid Services (CMS) has issued guidance to states on the implementation of section 2404 of the Affordable Care Act which amended section 1924 of the Social Security Act, “Protection for Recipients of Home and Community-Based Services Against Spousal Impoverishment.” The Act amended section 1924(h)(1) to require, for the five-year period beginning January 1, 2014, that states include in the definition of an “institutionalized spouse” married individuals who are “eligible for medical assistance for home and community-based services . . . ”

The guidance describes how states must apply the statute in making Medicaid eligibility determinations.  Justice in Aging summarized some of the highlights in a recent Health Network Alert:

• Under the statute, an individual must be eligible for HCBS in order for the protections to apply, and CMS interprets this to mean individuals must meet the nonfinancial eligibility requirements for HCBS.
• For those eligible through use of the spousal eligibility rules based on their need for HCBS, the statute does not require that they actually receive the HCBS for which they are eligible. This rule will apply, for example, to clients who are on a waiting list for a waiver.
• CMS provides additional guidance on what type of HCBS an applicant must be eligible for in order for spousal impoverishment rules to apply.  
• The guidance includes clarification on how the expanded application of spousal impoverishment rules applies in post eligibility treatment of income (PETI) cases and the rule’s applicability to individuals deemed eligible for services under the Modified Adjusted Gross Income (MAGI).  

 To read the letter providing guidance to state Medicaid Directors, click here.