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Financial help for Michigan Medicare enrollees

Michigan residents who use the spend-down program must resubmit medical expenses every month to requalify for Medicaid benefits

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As a Medicare beneficiary, your state of residence may have a significant impact on the care that you receive and how you pay for that care during your “golden years.” This page explains how Michigan’s regulations and policies are likely to affect your bottom line.

Does Michigan help with my Medicare premiums?

Many Medicare beneficiaries who struggle to afford the cost of Medicare coverage are eligible for help through a Medicare Savings Program (MSP). In Michigan, these programs pay for Medicare Part B premiums, Medicare Part A and B cost-sharing, and – in some cases – Part A premiums.

  • Qualified Medicare Beneficiary (QMB): The income limit is $1,063 a month if single or $1,437 a month if married. QMB pays for Part A and B cost sharing, Part B premiums, and – if a beneficiary owes them – it also pays their Part A premiums.
  • Specified Low Income Medicare Beneficiary (SLMB):  The income limit is from QMB levels up to $1,276 a month if single or $1,724 a month if married. SLMB pays for Part B premiums.
  • Qualified Individuals (QI): The income limit is from SLMB levels up to $1,436 a month if single or $1,940 a month if married. QI pays for Part B premiums.

Who's eligible for Medicaid for the aged, blind and disabled in Michigan?

While Medicare covers many services — such as hospitalization, physician services, and prescription drugs — there are gaps for some benefits. Some Medicare beneficiaries may qualify for additional healthcare coverage via Medicaid for the aged, blind and disabled (ABD).

Medicaid ABD will not automatically cover Long Term Services and Supports (LTSS) in Michigan. Those services usually require an additional application and require applicants to undergo an assessment.

Income eligibility: The income limit is $1,063 a month if single and $1,437 a month if married.

Asset limits: The asset limit is $2,000 if single and $3,000 if married.

Michigan’s Medicaid spend-down for Medicaid for the aged, blind and disabled and LTSS

In Michigan, applicants whose income exceeds limits for Medicaid ABD benefits can enroll in the Medicaid spend-down. This program allows enrollees to qualify for Medicaid by using medical expenses to reduce their income that’s counted toward the Medicaid eligibility limit.

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Medicaid calculates the portion of an enrollee’s monthly income above the program’s income limit (known as “excess income”). Enrollees access their Medicaid spend-down benefits by submitting medical bills equal to that amount. Excess income is reduced by what an enrollee pays for health insurance premiums (such as Medicare Part B or Medigap).

In Michigan, the Medicaid spend-down is usually approved in one-month increments, with additional periods requiring new medical expenses to be submitted.

The spend-down in Michigan covers both Medicaid ABD and Long Term Services and Supports (LTSS).

Income eligibility: The income limit is $1,063 a month if single and $1,437 a month if married.

Asset limits: The asset limit is $2,000 if single and $3,000 if married.

How does Michigan regulate long-term services and supports (LTSS)?

Medicare beneficiaries increasingly need long-term care – which is mostly not covered by Medicare. Twenty percent of Medicare beneficiaries who lived at home received some assistance with LTSS in 2015, and the portion of seniors needing these services will rise as the population ages. Medicaid fills this gap in Medicare coverage for long-term care, but its complex eligibility rules can make qualifying for benefits difficult. What’s more – eligibility rules vary significantly from state to state.

Applicants seeking Medicaid long-term care benefits must undergo a level of care assessment.

Medicaid nursing home coverage

Income limits: The income limit is $2,349 a month if single and $4,698 a month if marred (and both spouses are applying).

If only one spouse needs Medicaid, the income limit for single applicants is used – and usually only the applying spouse’s income is counted.

However, this income limit doesn’t mean nursing home enrollees can keep all of their income. Enrollees must pay nearly all their income each month to their nursing home, other than a small personal needs allowance (of $60 a month) and money to pay for health insurance premiums (such as Medicare Part B and Medigap).

Assets limits: The asset limit is $2,000 if single and $3,000 if married (and both spouses are applying). If only one spouse needs Medicaid, the other spouse can keep up to $128,640.

Certain assets are never counted, including many household effects, family heirlooms, certain prepaid burial arrangements, and one car.

In Michigan, applicants for Medicaid nursing home benefits can’t have more than $595,000 in home equity.

Home and Community Based Services (HCBS) waivers

Every state’s Medicaid program covers community-based LTSS services. Programs that pay for these services are called Home and Community Based Services (HCBS) waivers because recipients continue living in the community. Applicants must show that they can live safely in their home to qualify for HCBS.

Income limits: The income limit is $2,349 a month if single and $4,698 a month if married (and both spouses are applying).

If only one spouse needs Medicaid, the income limit for single applicants is used and usually only the applying spouse’s income is counted.

Asset limits: The asset limit is $2,000 if single and $3,000 if married (and both spouses are applying). If only one spouse needs HCBS, the other spouse can keep up to $128,640.

HCBS enrollees can’t have more than $595,000 in home equity.

Spousal impoverishment protections in Michigan

Eligibility rules for Medicaid LTSS programs differ from other Medicaid benefits when only one spouse is applying. In this situation, only the applying spouse’s income is counted. For many other Medicaid benefits, the income of both spouses is counted – regardless of who is applying.

If only one spouse is receiving Medicaid coverage for nursing home care or HCBS, spousal impoverishment rules allow the non-applying (or “community spouse”) to keep a Minimum Monthly Maintenance Needs Allowance (MMMNA) from their Medicaid spouse’s income.

Michigan 2020 spousal impoverishment rules allow community spouses to keep:

These spousal impoverishment levels will reset in July 2021.

Medicaid home equity limit in Michigan

Federal law requires states to limit eligibility for Medicaid nursing home and HCBS to applicants with a home equity interest below a specific dollar amount. In 2020, states set this home equity level based on a federal minimum of $595,000 and maximum of $893,000.

Michigan has chosen to use the most restrictive limit on home equity, which means applicants for nursing home care or HCBS can’t have more than $595,000 in home equity.

Penalties for transferring assets in Michigan

Because long-term care is expensive, individuals can have an incentive to give away or transfer assets to make themselves eligible for Medicaid LTSS. To curb these asset transfers, federal law requires states to have a penalty period when applicants seeking Medicaid nursing home coverage give away or transfer assets for less than their value. States can choose to also have a penalty period for HCBS. Medicaid will not pay for LTSS during this period.

Michigan has chosen to have an asset transfer penalty for both nursing home care and HCBS. This penalty period is based on the value of asset transfers or gifts made during a 60 month lookback period prior applying for Medicaid. The length of the penalty period is determined by dividing the amount of money transferred or given away by the monthly cost of nursing home care (which is $8,618 in Michigan in 2020).

Estate recovery in Michigan

State Medicaid agencies are required to attempt to recover long-term care related costs paid for enrollees who were 55 or older. States can choose to also recover their payments for other Medicaid benefits (including coverage that is unrelated to LTSS).

Michigan has chosen to only recover from the estates of enrollees who received Medicaid LTSS beginning at the age of 55.

When Medicaid coverage was administered by a Managed Care Organization (MCO), the state will attempt to recover what it paid that MCO. That means the estate recovery amount could be more (or less) than the actual cost of Medicaid services received.

Michigan will delay its estate recovery if a beneficiary is survived by their spouse or by a child who is under 21 or disabled. When this occurs, estate recovery would take place once the spouse dies (or the child turns 21 or is no longer considered disabled).

Estate recovery can also be waived altogether an estate would be the primary source of income for the person inheriting it. To be eligible for this waiver, the person inheriting the estate would need to have a household income below two times the federal poverty level ($2,128 a month for single individuals) and less than $10,000 in assets.

In Michigan, estate recovery is limited to an enrollee’s “probate estate” – or the portion of the estate subject to a person’s will. This means that life estates, certain trusts, and retirement or bank accounts with “transfer-on-death” provisions will not be recovered.

Congress exempted Medicare premiums and cost sharing from Medicaid estate recovery starting with benefits paid after December 31, 2009, although Medicaid may attempt to recover MSP benefits paid through that date. In Michigan, this could only occur for enrollees who received long-term care.

Where can Medicare beneficiaries get help in Michigan?

Michigan Medicare/Medicaid Assistance Program (MMAP)

Free volunteer Medicare counseling is available by contacting the Michigan Medicare/Medicaid Assistance Program (MMAP) at 1-800-803-7174.

The MMAP can help beneficiaries enroll in Medicare, compare and change Medicare Advantage and Part D plans, and answer questions about state Medigap protections. MMAP counselors may also be able to offer referrals to local agencies for services like home care and long-term care.

Elder Law Attorneys

Elder law attorneys can help individuals plan for Medicaid long-term care benefits. The National Academy of Elder Law Attorneys (NAELA) has a search feature beneficiaries can use to find an elder attorney locally.

Michigan Aging and Disability Resource Centers (ADRCs)

Medicare beneficiaries can also receive help through one of Michigan’s Area Agencies on Aging (AAAs). These AAAs provide information and assistance with planning for long-term care needs. Here is a list of AAAs in the state.

Where can I apply for Medicaid in Michigan?

The Medicaid program is administered by the Department of Human Services (DHS) in Michigan. Individuals can use this website to apply for Medicaid ABD or a Medicare Savings Program.


Josh Schultz has a strong background in Medicare and the Affordable Care Act. He coordinated a Medicare technical assistance contract at the Medicare Rights Center in New York City, where he represented clients with complex Medicare claims and appeals. Josh helped to implement federal and state health insurance exchanges at the technology firm hCentive. He has also held consulting roles, including at Sachs Policy Group, where he worked on Medicare and Medicaid related client projects.

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