An ALJ may increase the community spouse income allocation (CSIA) if the community spouse does not have enough income to pay his or her “necessary and basic maintenance needs.” In this case, the petitioner’s community spouse had expenses including a English as a Second Language classes, income and payroll taxes, and travel expenses to visit her spouse. ALJ Nancy Gagnon concluded these expenses were necessary and basic and ordered the income allocation increased. She also found a few expenses not necessary and basic: tithes, gifts, life insurance, spending money for the IS, and cable television.
This decision was published with support from the Elder Law & Special Needs Section of the State Bar of Wisconsin, the Wisconsin chapter of the National Academy of Elder Law Attorneys, and Krause Financial. Thanks also to Attorney Andy Falkowski, who donated this decision from his file.
Preliminary Recitals
Pursuant to a petition filed February 27, 2012, under Wis. Stat. § 49.45(5), and Wis. Admin. Code § HA 3.03, to review a decision by the Waupaca County Department of Social Services in regard to Medical Assistance (MA), a hearing was held on March 28, 2012, at Waupaca, Wisconsin.
The issue for determination is whether all or a portion of the petitioner’s income should be “allocated” (disregarded) under spousal impoverishment provisions.
There appeared at that time and place the following persons:
PARTIES IN INTEREST:
Petitioner:
—
Respondent:
Department of Health Services
1 West Wilson Street, Room 651
Madison, Wisconsin 53703
By: Jane Voelker, ES Spec.
Waupaca County Department of Social Services
811 Harding Street
Waupaca, WI 54981-2087
ADMINISTRATIVE LAW JUDGE:
Nancy J. Gagnon (telephonically)
Division of Hearings and Appeals
Findings of Fact
- Petitioner (CARES # —) is a resident of Waupaca County.
- The petitioner has lived in a nursing home since November, 2010. He filed an application for Institutional /Long Term Care MA, and was found eligible beginning with November, 2010. On January 18, 2012, the Department issued a notice to the petitioner advising that his MA would be discontinued effective February 1, 2012, due to failure to complete an annual review. The review was then completed. On February 2, 2012, the Department issued written notice to the petitioner advising that his patient liability contribution would increase, to $674.05, for his nursing home care expense (the balance is paid for by MA) effective February 1, 2012. That notice also advises the petitioner that only the $45 personal allowance and his $859.58 spousal income allocation would be subtracted from his income in this nursing home liability computation.
- The petitioner has a spouse, — residing in the community. She has an average gross monthly income of $1,809, all of it earned income. The Maximum Community Spouse Income Allocation is $2,668.58. Because the spouse’s gross income was under the $2,668.58 maximum allocation amount by $859.58, the Department automatically determined that $859.58 of the institutionalized spouse’s income would be allocated to her.
- The petitioner has gross monthly income of $1,578.63. After subtraction of the $45 statutory personal allowance and the $859.58 Community Spouse Income Allocation, the Department determined that the petitioner had $674.05 (from February onward) available to contribute toward the cost of his nursing home care.
- Ms. — has identified living expenses at hearing that total $3,048.00.
- Of the monthly expenses referred to in Finding #5, $2,715.00 are reasonable, basic and necessary living expenses. The petitioner has atypical expenses for the spouse of a nursing home resident in that (1) she has poor English and is taking ESL classes to communicate adequately in her husband’s absence, (2) she is employed, and therefore pays income taxes, and (3) she visits her husband at a facility that is distant from her residence, and incurs expenses in connection with the visits.
Discussion
Spousal impoverishment is an MA policy, created pursuant to the Medicare Catastrophic Coverage Act of 1988, which allows persons to retain assets and income that are above the regular MA financial limits. Spousal impoverishment policy applies only to institutionalized persons and their community spouses.
After an institutionalized person is found eligible, s/he may allocate some of his income to the community spouse if the community spouse’s gross monthly income does not exceed the Maximum Community Spouse Income Allocation of $2,668.58. See MA Eligibility Handbook (MEH), 18.6.2, online at http://www.emhandbooks.wisconsin.gov/meh-ebd/meh.htm. In this case, the gross income of the community spouse is $1,809. The Department therefore allocated $859.58 from the institutionalized spouse’s net income to him as the community spouse.
The community spouse argues that she cannot get by without a larger allocation. The county agency does not have discretion to allocate income to her that would cause her “income plus allocation” total to exceed $2,668.58. However, I have some limited discretion and have determined that Ms. — income is short of what she needs to cover basic living expenses. The statute allows the allocation to be raised to avert financial duress, created by exceptional circumstances, for the community spouse. I conclude that the Maximum Allocation must be raised to $2,715.00, to avert financial duress. Exceptional circumstances are present here: the spouse (1) is employed and pays income taxes, and (2) has long-distance costs incurred in visiting her husband. See s. 49.455(8)(c), Wis. Stats. The acceptable monthly expenses verified by the community spouse are as follows:
| Rent | 630.00 |
| Renter’s insurance | 7.00 |
| Utilities/water | 168.00 |
| Telephone | 82.00 |
| Federal income tax | 131.00 |
| State income tax | 90.00 |
| SocSec/Medicare taxes | 112.00 |
| Car payment | 359.00 |
| Car insurance | 55.00 |
| Gas (car) | 270.00 |
| Vehicle maintenance | 20.00 |
| Groceries | 200.00 |
| Wife’s health insurance | 384.00 |
| Wife’s health ins deductible | 50.00 |
| Wife’s dental insurance | 47.00 |
| Wife’s eye care | 25.00 |
| Wife’s ESL/school | 5.00 |
| Haircuts | 15.00 |
| Clothes/toiletries | 65.00 |
| TOTAL | $2,715.00 |
In setting the Maximum Allocation at $2,715, I accepted as accurate the budget numbers provided by the community spouse in her exhibits. The county agency may leave this $2,715 Maximum Allocation in place indefinitely ( or until the Maximum Allocation established in the Handbook becomes higher), unless the petitioner’s spouse’s circumstances change significantly.
Some of the expenses identified by the community spouse were not included in setting the Maximum Allocation. The excluded monthly expenses were tithes, gifts, life insurance, spending money for the institutionalized spouse, and cable TV. Although I believe that the spouse does spend these amounts, I do not conclude that they are basic living expenses. Thus, they were not included. The petitioner listed $100 for spending for the institutionalized spouse. Because the MA statute has prescribed a $45 spending allowance, and because the institutionalized spouse’s spending does not assist the community spouse’s survival, the amount cannot be allowed.
Conclusions of Law
-
Due to exceptional circumstances, the petitioner’s spouse requires $2,715 to live on for February , 2012, forward.
THEREFORE, it is
Ordered
That the petition for review herein be remanded to the county agency with instructions to increase the petitioner’s Maximum Community Spouse Income Allocation to $2,715 effective with the February, 2012, cost of care liability determination. This action shall be taken within 10 days of the date of this Decision. In all other respects, the petition is dismissed.
[Request for a rehearing and appeal to court instructions omitted.]
If you found this decision useful, sign up for my email newsletter. You’ll get summaries of newly published decisions and a PDF of useful information on estate recovery.