Important 2015 Pennsylvania Medicaid and Elder Law Numbers!

When constructing a comprehensive Medicaid and Elder Law Plan, we must consider the financial threshold for qualifying for various government benefits such as Medicaid and Social Security.  These qualification numbers change each year and have a big impact on a client’s ability to qualify.  Additionally, many federal estate tax numbers are indexed for inflation and change annually.  These estate and gift tax exemptions are important when considering the necessity of estate tax planning under documents.  A review of the numbers below show increases or status quo across the board from 2014.

The official spousal impoverishment allowances for 2015 are as follows (we include Medicaid’s home equity limits):

Minimum Community Spouse Resource Allowance: $23,844 This is the minimum portion of the marital assets the Community Spouse may retain. Even if one-half of the marital assets would be less than $23,844 (2015) the Community Spouse will be able to keep this amount plus his or her “exempt” assets as defined below.

Maximum Community Spouse Resource Allowance: $119,220 This is the maximum portion of the marital assets (not including the “exempt” assets discussed below) that the Community Spouse may retain. Generally, the rule of law states that the Community Spouse may keep the lesser of the following: 1. one-half of the total marital assets, OR 2. $119,220 (for 2015). In addition to the determined amount, the Community Spouse may retain the applicable “exempt” assets, if any.

Maximum Monthly Maintenance Needs Allowance: $2,980.50 This is the maximum portion of the marital income that the Community Spouse may retain without a showing that additional income is necessary for his or her continued well being.

The minimum monthly maintenance needs allowance for the lower 48 states remains $1,966.25 ($2,457.50 for Alaska and $2,261.25 for Hawaii) until July 1, 2015. This is the minimum portion of the marital income that the Community Spouse may retain.

Exempt Assets: Regardless of the rules set out above, certain assets are considered “exempt” from the calculations above. The Community Spouse will be permitted to keep certain other “exempt” assets which are not part of the other calculations. They are as follows: 1. Primary Residence (subject to limits below) 2. Community Spouse Retirement Accounts (ie. IRA, 401k, 403b etc.) 3. One vehicle

Home Equity Limits:

Minimum: $552,000

Maximum: $828,000

For the CMS document announcing the 2015 impoverishment and home equity figures, click here.

Income Cap

The income cap for 2015 applicable in “income cap” states will be $2,199 a month.

Gift and estate tax figures

Federal estate tax exemption: $5.43 million for individuals

Lifetime tax exclusion for gifts: $5.43 million

Generation-skipping transfer tax exemption: $5.43 million

The annual gift tax exclusion remains at $14,000.

Long-Term Care Premium Deductibility Limits for 2015

The Internal Revenue Service has announced the 2015 limitations on the deductibility of long-term care insurance premiums from taxes. Any premium amounts above these limits are not considered to be a medical expense.

Attained age before the close of the taxable year Maximum deduction
40 or less $380
More than 40 but not more than 50 $710
More than 50 but not more than 60 $1,430
More than 60 but not more than 70 $3,800
More than 70 $4,750

Benefits from per diem or indemnity policies, which pay a predetermined amount each day, are not included in income except amounts that exceed the beneficiary’s total qualified long-term care expenses or $330 per day (for 2015), whichever is greater.

For these and other inflation adjustments from the IRS, click here.

Medicare Premiums, Deductibles and Copayments for 2015

  • Part B premium: $104.90/month (unchanged)
  • Part B deductible: $147 (unchanged)
  • Part A deductible: $1,260 (was $1,216)
  • Co-payment for hospital stay days 61-90: $315/day (was $304)
  • Co-payment for hospital stay days 91 and beyond: $630/day (was $608)
  • Skilled nursing facility co-payment, days 21-100: $157/day (was $152)

Premiums for higher-income beneficiaries:

  • Individuals with annual incomes between $85,000 and $107,000 and married couples with annual incomes between $170,000 and $214,000 will pay a monthly premium of $146.90 (unchanged).
  • Individuals with annual incomes between $107,000 and $160,000 and married couples with annual incomes between $214,000 and $320,000 will pay a monthly premium of $209.80 (unchanged).
  • Individuals with annual incomes between $160,000 and $214,000 and married couples with annual incomes between $320,000 and $428,000 will pay a monthly premium of $272.70 (unchanged).
  • Individuals with annual incomes of $214,000 or more and married couples with annual incomes of $428,000 or more will pay a monthly premium of $335.70 (unchanged).

Rates differ for beneficiaries who are married but file a separate tax return from their spouse:

  • Those with incomes between $85,000 and $129,000 will pay a monthly premium of $272.70 (unchanged).
  • Those with incomes greater than $129,000 will pay a monthly premium of $335.70 (unchanged).

For Medicare’s “Medicare costs at a glance,” click here.

Social Security Benefit Changes for 2015

Monthly federal Supplemental Security Income (SSI) payment standard will be $733 for an individual and $1,100 for a couple.

Average monthly Social Security retirement payment: $1,328 a month (was $1,306) for individuals and $2,176 (was $2,140) for couples

Maximum amount of earnings subject to Social Security taxation: $118,500 (was $117,000)

For a complete list of the 2015 Social Security changes, go to: http://www.ssa.gov/news/press/factsheets/colafacts2015.html

For assistance dealing with developing a comprehensive nursing home asset protection plan in Pennsylvania, please contact Douglas L. Kaune, esquire at 610 933 8069 or email him at dkaune@utbf.com. Doug’s entire practice is focused on elder law, Medicaid Application, estate planning, trust planning, estate administration and protection of clients’ assets from nursing home spending and estate and inheritance taxation. Unruh, Turner, Burke & Frees, P.C. is a full service law firm which has three convenient office locations in Phoenixville, West Chester and Paoli, Pennsylvania. The firm primarily services clients in Chester, Montgomery, Delaware, Philadelphia, Bucks and Berks Counties, but can represent clients throughout Pennsylvania.