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What is the CSRA?
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What is the CSRA?
Presented by Alex Thompson

What is the MMNA?

Hi, I’m Collin Terry, Benefits Planner for Krause Financial Services. Today, I’m going to talk about what the Monthly Maintenance Needs Allowance is and how it fits into the planning.

One of the biggest issues couples face when trying to qualify for Medicaid is the financial wellbeing of the community spouse. That’s why the Medicaid program has adopted certain measures to avoid spousal impoverishment.

The goal is for the spouse at home to maintain their current lifestyle within the community. This is done through asset and income regulations that ensure the community spouse is not left destitute once their loved one enters a nursing home.

When a Medicaid applicant qualifies for benefits, their income is still subject to paying the nursing home. They are given a monthly Personal Needs Allowance and certain medical deductions from their income, but the rest must go towards their cost of care – this is the applicant’s Medicaid co-pay.

For example, let’s say you had a client where their income was $1,700. They get to keep $60 for their Personal Needs Allowance, and they also have $100 in medical deductions. That means their Medicaid co-pay would be $1,540.

If the applicant is married, however, the community spouse may be eligible to receive some of this money. This is the Monthly Maintenance Needs Allowance, or MMNA. If the community spouse’s income is less than their MMNA, they are entitled to a portion or all of the institutionalized spouse’s income.

Some states apply a standard MMNA for all cases involving a married couple. As such, if the community spouse’s income is less than this amount, they will receive a shift in income from the institutionalized spouse of the difference. The amount will vary from state to state.

Now, let’s take that same client along with the Personal Needs Allowance and medical deductions, we will also subtract $450 from their income that will be shifted over to their spouse. This will not only help the community spouse but will also lower their Medicaid co-pay.

Most states, however, apply a minimum and maximum MMNA. This means the community spouse is not automatically entitled to receive a standard amount. Rather, the MMNA is based on the total shelter expenses of the community spouse. They will always be entitled to receive at least the minimum but may be eligible to receive a higher amount of income if they have shelter expenses above a certain threshold. The minimums and maximums may vary from state to state as well.

When calculating the MMNA, the most important figures are the Standard Utility Allowance and the Shelter Standard.

The Standard Utility Allowance is a standard figure applied to a community spouse if they pay monthly utility bills like electric, water, or heat. In that utility bills can vary from month-to-month, the Standard Utility Allowance is added to the community spouse’s monthly shelter expenses as an estimated utility amount, rather than taking into consideration the actual out-of-pocket costs. The Standard Utility Allowance will vary from state to state.

The Shelter Standard is a figure Medicaid applies to a community spouse’s monthly shelter expenses, like mortgage payments or real estate taxes, that the community spouse is responsible for. If their total expenses exceed the Shelter Standard, the MMNA is increased dollar-for-dollar from the minimum MMNA to account for the difference, not to exceed the maximum MMNA. The Shelter Standard also varies from state to state.

To make this clearer, let’s look at an example.

Helen and Joe live in Michigan. They have spent down their countable assets to enable Joe to be eligible for Medicaid benefits. Helen has a monthly income of $2,000. The Minimum MMNA in Michigan is $2,057.50, while the Maximum MMNA in Michigan is $3,160.50. The Standard Utility Allowance is $609, and the Shelter Standard is $617.25.

First, we will determine Helen’s total monthly shelter expenses. Her mortgage payment is $700, real estate is $300, homeowner’s insurance is $50, and the Standard Utility Allowance in Michigan is $609. Helen’s total monthly expenses are $1,559.

Next, we will deduct the Shelter Standard from the total monthly expenses to get $941.75.

Then, we add the excess expenses to the minimum MMNA. So we will add $941.75 to $2,057.50. This will give us $2,999.25.

Finally, we determine the shift of income from Joe. We’ll subtract Helen’s MMNA from her income to get a shift of $999.25 from Joe’s income.

In order to fully understand the terms we discussed, you may want to check out the Introduction to the CSRA video in our Access Series. That video will go through terms and other keywords used when calculating CSRAs and MMNAs.

And if you’d like to learn more about your client’s options when working towards Medicaid eligibility, please contact our office at 855-552-5893 to speak with a Benefits Planner.

I’m Collin Terry, and thanks for watching.

Watch Next:

What is the CSRA?
4:42
What is the CSRA?
Presented by Alex Thompson
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