The Listen to Lawrence Letter: Would my IRA RMD and SS go towards the cost of my nursing home?

September 20, 2023
September 14, 2023 • Volume 4 Issue 173
A follow-up question regarding retirement plans and Medicaid: Read on…


I have an irrevocable Medicaid Trust with you.   As a follow-up question to your recent LISTEN TO LAWRENCE LETTER on September 12, 2023, Volume 4 Issue 172; I ask the following question: I understand that if I need to go into a nursing home my monthly IRA RMD (as determined by Medicaid) and Social Security would go towards the cost of my nursing home expenses. If the RMD & SS were not enough to cover the monthly expenses and assume I had no other assets other than retirement plans, would the retirement IRA principal be invaded to cover the shortfall or would the shortfall be covered by Medicaid?


The bottom line answer is that the shortfall would be covered by Medicaid. The principal amount in the retirement plans is not counted as an asset. Therefore, if you had $500,000 sitting in an IRA, and you already contributed the required minimum distribution ( as determined from Medicaid’s life expectancy charts), then the full $500,000 cannot be touched. Got it?

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