South Dakota Medicaid Eligibility for Long Term Care: Income & Asset Limits

Last updated: July 27, 2018

South Dakota Medicaid Definition

Medicaid in South Dakota is administered by the South Dakota Department of Social Services (DSS) agency.

Medicaid is a wide-ranging health insurance program for low-income individuals of all ages. Jointly funded by the state and federal government, it provides health coverage for various groups of South Dakota residents, including pregnant women, parents and caretaker relatives, adults with no dependent children, disabled children and adults, and seniors. However, the focus of this webpage is strictly on Medicaid eligibility for South Dakota elders, aged 65 and over, and specifically for long term care, whether that be at home, in a nursing home, or in an assisted living facility.

  The American Council on Aging now offers a free, quick and easy Medicaid eligibility test for seniors.

 

Income & Asset Limits for Eligibility

There are several different Medicaid long-term care programs for which South Dakota seniors may be eligible. These programs have slightly different financial and medical (functional) eligibility requirements, as well as varying benefits. Further complicating eligibility are the facts that the requirements vary with marital status and that South Dakota offers multiple pathways towards Medicaid eligibility.

1) Institutional / Nursing Home Medicaid – this is an entitlement program, which is provided only in nursing homes. This means anyone who meets the requirements will receive assistance.
2) Medicaid Waivers / Home and Community Based Services (HCBS) – with these programs, there are a limited number of participant enrollment slots. Therefore, wait lists may exist. Benefits are provided at home, adult day care, or in assisted living.
3) Regular Medicaid / Aged, Blind, and Disabled – this is an entitlement program, which means all eligible applicants are able to receive services. Benefits are provided at home or adult day care.

The table below provides a quick reference to allow seniors to determine if they are immediately eligible for long term care from an South Dakota Medicaid program. Alternatively, take the Medicaid Eligibility TestIMPORTANT, not meeting all the criteria below does not mean one is not eligible or cannot become eligible. More.

2018 South Dakota Medicaid Long Term Care Eligibility for Seniors
Type of Medicaid Single Married (both spouses applying) Married (one spouse applying)
Income Limit Asset Limit Level of Care Required Income Limit Asset Limit Level of Care Required Income Limit Asset Limit Level of Care Required
Institutional / Nursing Home Medicaid $2,250 / month $2,000 Nursing Home $4,500 / month (Each spouse can have up to $2,250) $3,000 Nursing Home $2,250 / month for applicant $2,000 for applicant & $123,600 for non-applicant Nursing Home
Medicaid Waivers / Home and Community Based Services $2,250 / month $2,000 Nursing Home $4,500 / month (Each spouse can have up to $2,250) $3,000 Nursing Home $2,250 / month for applicant $2,000 for applicant & $123,600 for non-applicant Nursing Home
Regular Medicaid / Aged Blind and Disabled $750 / month $2,000 None $1,125/ month $3,000 None $750 / month $2,000 None
What Defines “Income”

For Medicaid eligibility purposes, any income that a Medicaid applicant receives is counted towards the income limit. To clarify, this income can come from any source. Examples include employment wages, alimony payments, Veteran’s benefits (with the exception of the VA Aid & Attendance Pension), railroad retirement, pension payments, Social Security Disability Income, Social Security Income, Supplemental Security Income, inheritance, and stock dividends. However, when only one spouse of a married couple is applying for Medicaid, only the income of the applicant is counted. Said another way, the income of the non-applicant spouse is disregarded and does not affect the applicant spouse’s eligibility. Learn more about how Medicaid counts income here.

For married couples with non-applicant spouses’, there is a spousal impoverishment provision called the Minimum Monthly Maintenance Needs Allowance (MMMNA). The MMMNA is intended to ensure non-applicant spouses have sufficient monthly incomes. In simple terms, if the non-applicant spouse, also called the community spouse or well spouse, has income under $2,057.50 / month (this figure changes each year in July), he or she is entitled to a portion of the applicant spouse’s income, bringing the non-applicant’s monthly income to this amount. If the well spouse has income equivalent to $2,057.50 / month or more, he or she may be entitled to a greater amount of the applicant spouse’s income, given their shelter and utility costs are high. Please note, the maximum monthly income the non-applicant spouse may be entitled to is $3,090 / month (this figure changes in January of each year).

 

What Defines “Assets”

Countable assets include cash, certificates of deposit, stocks, bonds, annuities, credit union, savings, and checking accounts, and real estate in which one does not reside. However, for Medicaid eligibility purposes, there are many assets that are not counted. In other words, they are exempt from the asset limit. Exemptions include personal belongings, such as clothing, household furnishings and appliances, an automobile, select prepaid funeral contracts, and one’s primary home, as long as the Medicaid applicant or their spouse lives in the home and the equity value is under $572,000 (in 2018).

For married couples, as of 2018, the community spouse can retain half of the couples’ joint assets (up to a maximum of $123,600), as the chart indicates above. That said, if a couple has resources equal to or less than $24,720, the non-applicant spouse is able to retain 100% of the assets. This spousal impoverishment rule is referred to as the Community Spouse Resource Allowance (CSRA) and is intended to prevent the non-applicant spouse from having too little from which to live.

Please note, it is vital that one does not give away assets or sell them for less than fair market value in an attempt to meet Medicaid’s asset limit. This is because South Dakota has a Medicaid Look-Back Period, which is a period of 60 months (5 years) that dates back from one’s Medicaid application date. During this time frame, Medicaid checks all past transfers (even ones made by non-applicant spouses) to ensure no assets were sold or given away for less than they are worth. If one is found to be in violation of the look-back period, one will be penalized with a period of Medicaid ineligibility.

 

Qualifying When Over the Limits

For elderly South Dakota residents (65 and over) who do not meet the eligibility requirements in the table above, there are other ways to qualify for Medicaid.

1) Qualified Income Trusts (QIT’s) – QIT’s, also referred to as Miller Trusts, are special trusts for Medicaid applicants who are over the income limit, yet still cannot afford to pay for their long-term care. This type of trust, also called a Medicaid Income Trust in South Dakota, offers a way for individuals over the Medicaid income limit to still qualify for long-term care Medicaid, as money deposited into a QIT does not count towards Medicaid’s income limit. In simple terms, one’s excess income (over the Medicaid income limit) is directly deposited into a trust, in which a trustee is named, giving that individual legal control of the money. The account must be irreversible, meaning once it has been established, it cannot be changed or canceled, and must have the South Dakota Department of Social Services listed as the remainder beneficiary. In addition, the money in the account can only be used for very specific purposes, such as paying long term care services / medical expenses accrued by the Medicaid enrollee, and, if applicable, the Medicaid enrollee’s personal needs allowance and an income allowance for a community spouse. As previously stated, the income in this account is exempt from Medicaid’s income limit.

Unfortunately, Qualified Income Trusts do not assist one in qualifying for Medicaid if their assets are over the eligibility limit. Said another way, if one meets the income requirements for Medicaid eligibility, but not the asset requirement, the above option cannot assist one in “spending down” their excess assets. However, one can “spend down” assets by spending assets over the asset limit on non-countable ones. Examples include home modifications and additions (wheelchair ramps, roll-in showers, stair lifts, and adding first floor bedrooms), home improvements (replacing faulty electrical wiring, updating plumbing, and replacing old water heaters), vehicle modifications (wheelchair lifts, adaptive control devices, and floor modifications to allow one to drive from a wheelchair), prepaying funeral and burial expenses, and paying off debt.

2) Medicaid Planning – the majority of persons considering Medicaid are “over-income” or “over-asset” or both, but still cannot afford their cost of care.  For persons in this situation, Medicaid planning exists. By working with a Medicaid planning professional, families can employ a variety of strategies to help them become Medicaid eligible. Read more or connect with a Medicaid planner.

 

Specific South Dakota Medicaid Programs

1) Personal Care Services – part of the state Medicaid plan, this program is intended to prevent unnecessary nursing home placements and provides personal care in the homes of eligible applicants. Benefits include help with bathing and grooming, dressing and undressing, eating, mobility, shopping for essentials, light housework, and meal preparation.

2) Hope Waiver – previously called the HCBS Waiver for the Elderly, this waiver is also a nursing home diversion program and provides benefits in one’s home or assisted living facility. Available benefits may include adult day care, private duty nursing, homemaker services, personal care assistance, home modifications, emergency response systems, and more.

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