The Impact of Asset Limits

Imagine saving money for months to afford a trip to Disney World. You’ve planned your transportation, and you’ve eagerly made an itinerary so you can visit each attraction you want to see. All the details are set. Now imagine you lose your health insurance because you saved $2,000.01 for that trip. This is the reality that millions of people on Medicaid face. There is a $2,000 asset limit imposed on anyone who receives social security or Medicaid benefits, and if they save over that amount, even by a single penny, they become ineligible for their Medicaid and social security benefits.

For the people served by Boundless, this asset limit creates a lot of problems, from the number of hours they can work to arbitrarily buying items to lower their savings to prepare for income. However, a bill recently introduced to the U.S. Senate and House of Representatives seeks to change the asset limit. The $2,000 limit hasn’t changed since the 1980s, but if the SSI Savings Penalty Elimination Act were to pass, the limit would increase to $10,000 per person. This increase would have far-reaching impacts on the people we serve and millions across the country.

“Two-thousand dollars isn’t that much for someone we’ve supported for a while,” said Ambur Jessup, community living services associate director at Boundless. Residents in intermediate care facilities (ICFs) are allocated $50 per month for personal needs, but ICFs are financially responsible for all aspects of care and their expenses. Often, the $50 allowances don’t get spent in full and accumulate over time. For someone that has been served in an ICF for years or decades, that often means that the ICF staff will have to spend some of that resident’s allowance just to make sure they don’t reach that $2,000 mark. If it were to exceed the $2,000 mark, they would suddenly lose their Medicaid coverage and no longer be eligible to live in an ICF. “We’re spending it to spend it right now,” Jessup added, to ensure residents maintain their eligibility.

“Ten-thousand dollars would allow for more wiggle room, more flexibility and allow people to save,” Jessup said. “A lot of our folks can’t save.” To return to the Disney World example, “I have five guys in Disney this week, with our supported living program. They had to save a good chunk of money to do that. More than $2,000. So, while yes, they’re [saving in] STABLE and hold trust, it doesn’t allow somebody to just save their money and say, ‘I need $5,000 to go on this trip.’ They have to do all these other things to be able to do that.” Jessup explained. She further pointed out that once someone goes on their trip, they rarely have any money left over under the current asset limit, so they can’t go with a group to the bowling alley until they save up some money again.

The current limit also presents challenges on the other side of the spectrum. “We have a lady in supported living right now, who owns her own condo,” Jessup said. “She worked for many, many years and was able to do that. She has declined and now is going to move into one of our other homes with other roommates so that she can have more staffing and be around other people. She’s going to sell her condo. Well, that’s more than $2,000.” There are options that Jessup and other staff are working through with her, but it’s far more complicated than it would be for someone who’s not on Medicaid. While raising the asset limit to $10,000 wouldn’t solve this particular issue, it would relieve some associated pressure.

Kelly Freeman, director of revenue and reimbursement at Boundless, has seen similar situations. Estate planning becomes far more complicated. It’s a real possibility that someone we serve will inherit a large sum of money from their family members. However, unless estate planning is done very carefully, it could jeopardize Medicaid eligibility.

The ability to work in the community is also greatly impacted. Many individuals with I/DD are able to work and want to work but must choose between working and keeping their Medicaid eligibility. “That’s always a discussion,” Freeman said. She has experienced the work-or-benefits dilemma firsthand with her brother, who is on Medicaid and is able to work in the community. She explained, “You can only work so much, and quality of life is terrible, and he’s not engaged in the community because we can’t have him working or he’s going to lose benefits. We have to keep him eligible. It drives a lot of decision making.”

“They’re having to choose to have a great life and better themselves and continue growth or don’t go over the Medicaid limit. Most pick not losing their Medicaid,” Jessup agreed. There are a lot of people with I/DD that need Medicaid support but are very capable. They could be making a decent living, but due to the $2,000 limit, they cannot afford to make a decent living.

The proposed SSI Savings Penalty Elimination Act offers a ray of hope for millions of people served by organizations like Boundless. The increased asset limit holds the promise of providing greater autonomy, flexibility, and opportunities for those with disabilities, enabling them to pursue their aspirations without the constant fear of losing essential benefits. It’s not just a matter of financial figures, it's about enabling individuals to live with dignity, pursue their goals, and contribute meaningfully to their communities. As the conversations about this reform continue, it’s crucial to recognize the profound impact that a change in the asset limit could have on the lives of countless individuals.