Nursing home residents have a little more time to spend stimulus checks before losing Medicaid

Nursing home residents on Medicaid have some more time to spend their stimulus checks, but they shouldn’t wait too long.

Typically, Medicaid enrollees are only allowed to have a limited amount of assets, outside of their primary residence, car and other essentials. For single people, it’s usually around $2,000. Those who exceed that threshold could find themselves kicked out of the health insurance program for low-income Americans.

The $1,200 stimulus payments that many people received last spring did not count as income under Medicaid rules. So nursing home residents did not have to turn the money over to the facilities where they live and could save it for their own use.

But the funds are considered an asset after one year — a deadline that is swiftly approaching for the first of the three relief payments Congress has authorized since the pandemic began.

However, another coronavirus provision lawmakers approved last March prevents states from disenrolling residents from Medicaid during the public health emergency, which is currently set to end next month but is expected to be extended again.

This means that Medicaid recipients, including nursing home residents, don’t have to worry about spending the funds until the pandemic is over. Same goes for the $600 checks many received from the December relief bill and the $1,400 payment that is being distributed from President Joe Biden’s $1.9 trillion recovery package — though the clock on those funds started more recently.

Still, folks shouldn’t wait until the last minute to spend their stimulus funds. They can purchase things they need. They also could give the money to family or friends or make a charitable contribution — as long as the resident can show the gift is not part of a strategy to give away assets to qualify for Medicaid.

“People should just be conscious of Medicaid asset limits and deal with it without trying to wait until the last month of the public health emergency,” said Eric Carlson, a directing attorney with Justice in Aging, a non-profit legal advocacy group. “There’s no particular benefit to cutting it close.”