Utilization of Social Security After Qualifying for Medicaid

In Post 1, I discussed the handling of social security after a person qualifies for Medicaid. Since I have had this question on numerous occasions, I thought I would briefly summarize this issue.

After an individual qualifies for Medicaid, the nursing home will request that you assign social security and pension to them as representative payee.

The problems with such an approach are as follows:

1. Pension monies cannot be assigned as under the Internal Revenue Code they are inalienable (cannot be assigned).
2. Medicaid subsidizes Medigap insurance. Therefore, assigning the social security causes you to rely on the nursing home to pay the Medigap insurance, when you have the right to withhold the Medigap insurance and pay it yourself.
3. A Medicaid recipient can retain $35 a month. You can retain that in a separate account rather than assign that to the nursing home.

Therefore, if the nursing home requests to be the representative payee, refuse to do so and give the above as your answer.

Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.

© February 2012, Post 186