CARES Act Cash Payments Raise Questions for SSI and Medicaid

As the CARES Act implementation gears up, one question that we elder law attorneys have had  was how the cash payments would affect ongoing eligibility for means-tested benefits like SSI and Medicaid. These are the “economic impact payments” being sent to taxpayers.  If you get benefits from a program with a resource limit of $2000 and you get another $1,200 automatically, will that end your resource eligibility until you have spent those funds down? Will the $1,200 be counted as “income in the month received” like other forms of unearned income?

I have been closely following the blogs and press releases by the heads of government agencies such as the NJ Department of Health, NJ Department of Human Services, and Social Security.Tucked into a blog post from the Commissioner of the Social Security Administration, was stated, “Please note that we will not consider economic impact payments as income for SSI recipients, and the payments are excluded from resources for 12 months.”  This is good news!

In New Jersey, Medicaid rules regarding what counts as income and resources cannot be more strict than SSI; this is called “comparability”.  Under 42 U.S.C. 1396a(f), a State can only use more restrictive eligibility criteria for the aged, blind, and disabled than are used by SSI if the more restrictive criteria are no more restrictive than those used in the States’ Medicaid State plan as of January 1, 1972. New Jersey
however, did not elect to use a more restrictive resource methodology for determining whether an asset is a resource or income, and its official State Medicaid Plan adopts the SSI standard.

So when we hear about a policy being applied to SSI, we know that we can expect those same rules to apply to Medicaid Long Term Services and Supports.  Keep in mind, though, that by the end of the protected period, you have to be “spent down” again to the resource limit. And the funds received will have to be reported when the re-determination paperwork is filed. It’s important to not let time slip away.  In the past, Medicaid recipients have received tax refunds that were deposited into their account, and then close to a year later, families scramble to spend down before the end of the month.

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