Articles Posted in Medicaid Eligibility

Medicaid is a safety net for millions of senior citizens across the country, providing funding to pay for home care, adult day care, or prescription drugs. However, the program is designed for low income individuals and can leave many on the fence financially over whether to choose to spend down assets or pay for these necessary services themselves.

Currently, the threshold to receive Medicaid services is only a few hundred dollars for individuals and just over $1,000 for married couples, which leaves these individuals with little income to pay rent, utilities, or buy groceries. Even financially secure seniors can find themselves needing vital Medicaid services like in-home or nursing home care in the event of a catastrophic health event, making planning for the future and keeping options open all the more vital.

One option that may be viable for certain individuals is joining a Pooled Supplemental Needs Trusts, also known as a Pooled Income Trust. Pooled income trusts work by the individual sending his or her income from Social Security, pensions, or annuities to non-profit organizations to pay bills and other expenses to stay below the Medicaid threshold. Any income left over after the individual passes away goes to the non-profit.

Pooled Trusts Eligibility

Pooled Trusts are a type of trust applicable to those individuals who are seeking public assistance benefits, such as Medicaid, to become eligible financially by setting aside funds in a trust for additional needs. The trust allows its beneficiaries to preserve a specified amount of money in a trust to pay for supplemental care not covered by public assistance programs. For the elderly, many need public benefits assistance as they continue to age but do not qualify based on higher income. In these situations, a pooled income trust will benefit an elderly person by allowing them to continue their lifestyle, which is usually seeking to stay in the home, while also obtaining homecare services and paying for what their budget requires.

New York Medicaid Rules

THOROUGH PLANNING NEEDED IN ADVANCE

This blog has discussed the necessity of proper and thorough planning to ensure a smooth transition into a continuing care retirement community.  This requires, among other things, that a person properly and legally transfer all of their assets, or a substantial portion of their assets that is, to people or entities that would enable them to be eligible for Medicaid.  As many people know, there is a look back period where the state examines all transfers of assets or money over a certain period of time for purposes of Medicaid eligibility purposes.  

If during that time a person transferred any aset for less than full market value or did not transfer the assets to a proper investment vehicle that is otherwise exempt from Medicaid assets, the Medicaid applicant will likely be denied for financial reasons.  In other words Medicaid will claim that the applicant has too many assets or their income is too high to qualify.  Some examples of a Medicaid exempt transfer is the purchase of a graveyard plot, prepayment for funeral services or the purchase of a short term Medicaid annuity.  An interesting case from November, 2015 out of Broome County, entitled Good Shepherd Village at Endwell v. Peter Yezzi shows the many problems that can result when people start their Medicaid planning after admission to a continuing care retirement community.

SOME LIMITED RELIEF

Patients who rely on Medicare sometimes experience sticker shock after being released from the hospital only to find out that because some hospital administrator classified their stay as “observational” that they must pay a large portion of the final bill. Many times a doctor will seek to have a patient admitted for any number of reasons, only to have a bureaucrat reclassify the patient’s time at the hospital as observational. Such a designation will mean that Medicare will not pay for this time in the hospital. For Medicare to pay for a hospital stay, the patient has to be an admitted patient for at least three days (three midnights in the hospital).

Observational status does not equate to an admitted patient in Medicare’s own set of self defined definitions. That may be quite different to the patient who went to the hospital and received a number of drugs and tests during their time their and was consistent with the majority of their non-surgical stays in a hospital in life. In an effort to address these obvious problems that will only grow with time, President Obama signed a bill that required hospitals to warn patients that their stay will be considered observational in nature and that they are not being admitted under Medicare’s rules, which may result in a bill from the hospital that they will have to pay. The Notice of Observation Treatment and Implications for Care Eligibility Act would have to inform the patient that they are going to receive outpatient services under Medicare’s rules which requires cost sharing from the patient and that the observational status does not count towards the necessary three day inpatient in order to transition to a skilled nursing care facility.

Health insurers across the United States received a welcome surprise when they discovered that they will be receiving a 1.25% increase next year in Medicare revenue benefits. This declaration reverses a previous proposal by the U.S. government to decrease the amount of Medicare benefits that insurance companies would receive in order to bring it in line with other government programs for the elderly and disabled.

Medicare Benefits for Insurance Companies

The U.S. government has been slowly decreasing the amount of Medicare benefits received by insurance companies in a bid to bring private Medicare coverage equal to other government aid programs. This year, insurance companies received four percent less in benefits than 2014, and the original proposal for 2016 included benefits cuts of another 0.9%.

The New York Medicaid program is a critical lifeline for millions of residents. Unfortunately, many remain confused by some of the complex details. It is common to have only a fragmented understanding of how Medicaid works from random discussions with friends and neighbors or by hearing snippets of news clips discussing the program.

One of the most misunderstood aspects of the system is the “spend down” requirement. Medicaid is a need-based program, and so qualification requires one to have assets below a very low threshold. But that does not mean that everything you own will be lost before qualifying for Medicaid.

Medicaid Misunderstandings.

The price of nursing home care in New York is staggering. It is not uncommon for a stay to cost upwards of $15,000 – $20,000 per month. This is a burden that many New York seniors can not afford to pay. After all , many local residents are only living on small fixed incomes, and coming up with $180,000 – $240,000 per year to live in a skilled nursing facility is unthinkable.

For most resident the only alternative is support via the New York Medicaid system. But residents can usually only qualify for Medicaid if their non-exempt assets are “spent down.” In our state, the allowable amount of total assets is only $14,550. There are complex rules about what assets count toward this amount, but a NY Medicaid lawyer can explain whether things like a long-time family home can be saved or if retirement accounts must also be drained.

Look-Back Period

The Urban Institute recently released a new survey appraising the preparation for Medicaid expansion in many different states as part of the Affordable Care Act (ACA). The analysis discusses how eight individual states, including New York, are changing their programs to accommodate the implementation of the Affordable Care Act. The findings are part of the Robert Wood Johnson Foundation’s State Health Reform Assistance Network tracking program. A full online copy of the survey can be found here.

The study authors note that many states are using Medicaid “managed care” to expand eligibility. For example, as discussed in the report, New York “intends to move non-dual-eligible nursing home patients into managed care.” The goal is to complete the transition by October of this year. New York plans to participate in a special program to help manage care for seniors who are “dual eligible” for both Medicaid and Medicare. This includes many elderly community members. This program is know as the State Demonstrations to Integrate Care for Dual Eligible Individuals.

In addition, as part of the change, New York is switching from a voluntary managed care enrollment to a required one. In the past providers could participate if they chose, but now they cannot. New enrollments requirements mandate managed care participation. Over the long-term, of course, this requirement means that more and more Medicaid participants will be on managed care.

This week Dr. Nirav R. Shah–the Commissioner of Health for the state–issued a press release summarizing the positive impact of each of the Medicaid reform efforts that have taken place over the last few years. As many are aware, Governor Andrew Cuomo has been aggressive in his efforts to streamline the system, mostly motivated by financial concerns.

The Commissioner used the occasion to paint a positive picture of the New York Medicaid’s current situation. He noted how costs for the program are down while quality indicators are receiving good marks. Amazingly, all of this is coming at a time when actual enrollment in Medicaid is increasing. Lowering costs even with steady enrollment is difficult, and so do so while adding to the program is a real achievement. The press release points out that, all told, over $3.2 billion has been saved in New York City alone. That is not a trivial amount, particularly considering trends had been moving in the opposite direction for years.

Interestingly, the Commissioner noted that it was long-term care services which, in the past, were the main drivers of increased Medicaid spending. But the Medicaid Redesign Team has been able to “bend the cost curve,” mostly by shifting resources into less expensive but helpful programs–like at-home care.

The reverberations of Hurricane Sandy’s impact on the city are far from finished. We will be cleaning up and adapting for many months–likely years–into the future. Considering the predictions of some, we may even have to deal with large storms of this magnitude on a far more consistent basis. It affects all areas of life–including things like senior care and nursing home operations.

Many New Yorkers were shocked to learn of the goings-on at some long-term care facilities hit hardest by Sandy. Stories have been told of seniors stuck in upper levels of flooded facilities for days without power. Many questions have been raised about the management of the long-term care facilities and confusion over why the senior residents were not evacuated. In fact, in large part because of the struggle with NYC nursing home evacuations during Sandy, the Center for Medicare and Medicaid Services (CMS) will release new disaster planning for all nursing homes in the coming year.

Looking to the future, local residents are advised to understand evacuation plans for long-term care facilities where loved ones reside–or to ask about such plans when making nursing home choices. An AARP story recently profiled nursing home evacuation plans, pointing out the critical issues that facility caregivers need to consider. It is worth browsing the list to get an idea of the questions that owners and operators in New York need to be asked to ensure that seniors are protected in case any manner of natural or man-made disaster strikes requiring quick action.

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