Is the CSPA Connecticut’s Chapter of the ASPCA? Not exactly. So what is the CSPA and why am I writing about it anyway? CSPA stands for the Community Spouse Protected Amount and the reason my blog focuses on it this month is because the minimum CSPA in Connecticut has been increased to $50,000 effective July 1, 2022, which is a wonderful change where Medicaid’s concerned!
In our estate planning practice, we have clients who want to include charities in their Wills or Trusts. I have not done a scientific study, but I can say without a doubt that the majority of the charities chosen are ones that help animals, including the ASPCA. I mean, how can people resist those sweet kitten faces and Sarah McLaughlin’s angelic voice? With such a recognizable acronym, it’s easy to understand why some people confuse the CSPA with the ASPCA. I am here to tell you that CSPA has nothing to do with animals that need rescuing.
I’m sure you’re thinking, Joan, I still don’t understand why I should care…but stick with me and give me five more minutes of your time before you go off to rescue an abandoned puppy.
How Does The CSPA Relate to Medicaid?
The CSPA is an important figure when a married person needs to apply for Medicaid for their long-term care needs. Medicaid is the program that pays for long-term care in a skilled nursing facility and Connecticut’s Home Care Program for Elders is the program that pays for home care. Both of the programs require the person who is applying to qualify financially.
For both of these programs, the applicant cannot have more than $1,600 in countable assets. Countable assets include bank accounts, stocks and bonds, investment accounts, retirement accounts, including IRA’s and 401(k)’s, cash value of life insurance policies, and real property that the person does not live in as their primary residence.
Related Post: Asset Protection Planning Benefits For Medicaid
That’s SIXTEEN HUNDRED DOLLARS. You read that right. It is not a lot of money. It’s such a small amount that many people think I am referring to their monthly income, but this is the total amount of assets that someone is allowed to have to qualify for the State to pay for their long-term care at home or in a nursing home.
But wait, there’s more…the calculation of the value of an applicant’s assets includes all assets owned by the applicant’s spouse as well. It does not matter if the assets are titled 100% in the spouse’s name (for example, an IRA that is owned 100% by the spouse). State and federal law expect spouses to pay for the long-term care needs of each other.
Is The CSPA Limit Increase a Good Thing?
Let’s take an example from a couple who has starred in previous blogs. Jack and Diane. Jack now has Parkinson’s disease and needs assistance with getting out of bed, dressing, personal care, and eating. Diane is his caregiver but they both recognize that she is getting burnt out and are hoping they can get State assistance to pay for care.
Together they own their home where they reside and they have a joint checking account with $1,000, a savings account that they’ve put into Diane’s name with $34,000, and Diane’s IRA with $25,000. The first step is to add up all of their countable assets. They have a total of $60,000.
Even though Jack’s name is only on the $1,000 checking account, the State views his share of the couple’s estate to be one-half of $60,000, or $30,000. Prior to July 1, 2022, Jack and Diane would have to spend nearly all of what is considered Jack’s one-half of the couple’s assets so that his one-half of the assets was less than $1,600, before Jack could qualify for the State benefit that pays for home care.
(Now before you start bad-mouthing Connecticut, please note that many other states do not have State benefit programs that pay for home care; their programs only pay for the nursing homes. Further, if the State paid for people who have the means to pay for themselves, then our budget would be even higher…but I digress).
With the increase in the CSPA, Jack and Diane will only have to spend $10,000 because Diane is allowed to keep a minimum of $50,000.
How Will This Law Change Effect You?
I write about this law because it impacts many of our clients and others who will need care in the future. I am also proud to have played a part in the passage of the law.
This law was passed through lobbying efforts by the CT Chapter of the National Academy of Elder Law Attorneys, of which I am the Chairman of the Public Policy Committee, and has been something we have been working on for several years.
Our goal is to increase the minimum even higher so that couples can retain more of their assets when one of them if faced with the expense of long-term care. Under federal law, the State could allow the spouse to keep the maximum CSPA, which is currently $137,400.
As an Elder Law attorney and member of NAELA, I will continue to advocate for an increase so that a spouse can retain more of the couple’s assets. In my opinion, in the long run, it’s good policy because the spouse can be better cared for and not end up in a situation where all of his or her money is spent very quickly, causing them to end up on a State benefit as well.
If you or a loved one is in need of care and wants more information about the State and federal programs that can help pay for care, please contact us at (860) 669-1222 to schedule an Elder Law Consult.
Joan Reed Wilson Esq. – Managing Partner
Practices in the areas of estate planning, elder law, Medicaid planning, conservatorships, probate and trust administration, and real estate. Admitted to practice in the States of Connecticut and California, she is the President-elect of the CT Chapter of the National Academy of Elder Law Attorneys (NAELA), an active member of the Elder Law Section of the Connecticut Bar Association, accredited with the PLAN of CT for Pooled Trusts, with the Veteran’s Administration to assist clients with obtaining Aid & Attendance benefits for long-term care needs and with the Agency on Aging’s CareLink Network.