ELDER HELPER  Summer 2005

THE BASICS OF MEDICAID 

In order to understand Medicaid (MassHealth) eligibility, you first need to know how Medicaid treats your assets. This is not always easy since the laws are constantly changing. Recent changes have made it even more difficult for a couple to preserve their assets.

Medicaid breaks your assets down into two separate categories. The first are those assets which are exempt and the second are those assets which are non-exempt or countable.

Exempt assets are those which Medicaid will not take into account (at least for the time being). Generally the following assets are exempt:

• The home, no matter its value. The home must be the principal place of residence. The nursing home resident may be required to show some “intent to return home,” even if this never actually takes place.
• Household and personal belongings, such as furniture, appliances, jewelry and clothing.
• One vehicle, there may be some limitation on value.
• Prepaid funeral plans /accounts and burial plots.
• Cash value of life insurance policies, as long as the face value of all policies added together does not exceed $1,500. If it does exceed $1,500 in total face amount, then cash value in these policies is countable. Term life insurance is exempt.
• Cash (e.g. a small checking or savings account) not to exceed $2,000.
• Business property essential to self support.
• Irrevocable Annuities which meet certain restrictions.

These are basically the assets which Medicaid will ignore, at least for now. Keep in mind, the MassHealth Recovery Unit may come back to recoup payments made to a Medicaid recipient before or after the death of the recipient. All other assets which are not exempt (i.e. the ones not listed earlier) are countable. This includes checking & savings accounts, CDs, money market accounts, stocks, mutual funds, bonds, IRAs, pensions(with limited exceptions), second cars and so on. For the most part, all money and property, as well as any item that can be valued and turned into cash is a countable asset, unless it is one of those listed earlier as exempt.

While the Medicaid rules are complicated and somewhat tricky, for a single person it’s safe to say that you will qualify for Medicaid so long as you only have exempt assets plus $2,000 in cash or bank accounts.

For a married couple the community spouse (i.e. the one not needing nursing home care) can generally keep assets equal to ½ of countable assets up to a maximum of $95,120 with a minimum of $19,020 (2005).This amount increases from year to year. The Medicaid applicant may keep $2,000. However, there are things which can be done to protect assets beyond these levels. This issue of Elder Helper is only designed to review the basics. Future issues will deal with related topics covering Medicaid planning strategies.

Due to fiscal constraints many of the nation’s governors are advising Washington that the costs of the Medicaid program are out of hand. They are calling for changes in the program and the Bush Administration agrees that change is needed. What does this mean? It means that drastic changes are coming which will make it harder to protect your home and savings unless you act now to educate yourself about what legal options are available to you, before its too late.

ELDER HELPER Summer 2002


THE 9 QUESTIONS TO ASK IF GOING INTO A NURSING HOME

The decision to place yourself or a family member into a nursing home is one of the most difficult decisions
you may ever be asked to make. That's why it's important, if that time comes, to have a plan and to know what questions to ask.

In a perfect world, you'd have plenty of time to visit the nursing homes, talk to the residents, meet the care
staff, sample the food and so on. Unfortunately, we don't live in a perfect world. Often decisions have to
be made quickly and without a lot of information or comparisons.

You need to know what questions to ask to make an informed choice. Here are some of the basic things to consider:

1. Is a nursing home necessary or are there alternatives?

There are alternatives that people simply don't know about. Talk to your physician, social workers, Elder Services of Berkshire County and other professionals to see if there are
assisted living, home health care, or other alternatives for you.

2. How do I find the right nursing home?
At the very least, shop around. Personally visit each nursing home you are considering to determine quality of care, rooms, meals, staff & activities. Are the premises clean and well
maintained? Is the location desirable? Ask for recommendations from friend and relatives.

3. Once I find the right nursing home, how can I get in?

The admission process can be overwhelming because of the wealth of information presented. Be up front with the nursing home admissions director. Tell them all about your
situation, including your finances. Remember, nursing homes are generally operated and staffed by professionals dedicated to enhancing the lives of the elders they serve.

4. Who will pay for my care... me, Medicare, Medicaid?

It depends upon your personal situation and having a knowledge of this difficult area of the law. You also have to be sure to take advantage of the special protections available
for your spouse, if he or she will not also be in the nursing home. A good Elder Law attorney can help you through this entire process.

5. Are my children responsible to pay for my care?

Not if you handle the admissions process properly. Make sure you have a thorough understanding of all documents presented to you before signing.

6. Once I get in, how can I get the best care there?

The key here is to have a proper care plan in place. That's a plan developed by the nursing home staff professionals (and you) to determine exactly what kind of care you'll get.
Putting a proper care plan in place is perhaps the most important step you can take. If you feel you can't be the best advocate for yourself, then it's important to get help from an Elder Law attorney or a geriatric care manager or another health professional.

7. Can I be moved around the facility, from room to room, once I'm admitted?

There are several protections for you under Federal and state law. Prior to being moved, written notice must be given to you. Spend some time learning about your rights as a resident, or work with someone who will be an advocate for you.


8. What are the nursing home's duties to me?

In the interest of improving quality care, Congress passed laws which outline the minimum standards for health, safety, and resident rights in nursing homes. Nursing homes are required to disclose these to its
residents. You may be surprised and pleased to learn all of your rights.

9. Is there someone who can help me with all of this?

You can get help from many professionals,from an Elder Law Attorney to a geriatric care manager, to social workers. Be sure to deal
with a professional who understands the broad range of issues that arise when your or a loved one goes into a nursing home. Elder Services of Berkshire County has prepared a "Guide To Long Term Care" and a "Housing Options
Guide". The guides provide information on nursing homes, assisted living arrangements,housing options, payment sources and other types of services and contact information. More information about these guides can be obtained by calling Elder Services of Berkshire County at (413) 499-0524.


ELDER HELPER  Spring 2002

Are There Ways to Save the Home?

Jill was a good daughter. For a long time now,she has been the primary caretaker for her mother. Jill helps her mother by cooking, taking her mom to doctor appointments and otherwise assisting her with her day to day needs and tasks.

Three years ago Mom had a stroke and she could no longer care for herself. That's when Jill moved back home and took over Mom's care. She's been doing it for the past three years, but now it's gotten to the point where Mom needs more care than Jill can give.

Mom owns a $100,000 house and she'd like to give the house to Jill as a way of saying thank you for all that Jill has done for her. But when Mom and Jill
check around, they're told that if they gift the house to Jill, Mom will be ineligible for Medicaid for years.

They come to tears. You calmly tell them that there's a provision in the Federal Law which is binding in Massachusetts. The law states that you can give a home to an adult child who resided in the home for at least two years, if the child provided care which
permitted Mom to stay at home, rather than in an institution or facility.

In other words, if a child moves back home and cares for a parent, and if that child's care has kept the parent out of a nursing home for at least two years, then the home may be given to the child without Medicaid penalties.

So how should Jill document her care for Mom? The best thing would be to keep a log or journal that sets forth specific incidents or events that, but for the child's care, might have resulted in Mom's institutionalization. For instance, note things like gas burners not being shut off, water left running in the tub, Mom's wandering or other medically dangerous actions.

In addition, it would be helpful to have statements from other family members or neighbors telling of any events or circumstances that reinforce
Jill's position. Finally, it would be most helpful to have a letter from a physician and/or visiting nurse or home
health care provider saying that Jill's care did in fact keep Mom out of the nursing home for at least two years.

You explain this to Jill and her Mom and they are both delighted that all of Jill's good deeds will not go unrewarded. The house may be given to Jill and Mom can still qualify for Medicaid.

FYI: There are other situations where the home may be transferred without penalty. They include
transfers to the following persons:

• the spouse;
• a minor, blind or disabled child;
• a sibling who has an equity interest in the home and who has resided
there for at least one year before the Medicaid applicant became
institutionalized.

If you or if you know someone who is facing any of these situations and have any questions, give me a call at (413) 664-7700.


ELDER HELPER       Winter 2006

MEDICAID LAWS CHANGE AGAIN !

In previous issues of Elder Helper, I reviewed MA changes to the Medicaid laws. Luckily, many of those changes were repealed due to public outcry from senior advocacy groups. Medicaid is the program that pays for nursing home care if you can’t afford it ( referred to as MassHealth in MA). The bad news is that the federal government will now impose new changes which have a detrimental effect on elderly and disabled persons. Protecting your home & assets, and becoming eligible for Medicaid is now much harder. Some of the changes are set forth below:

* The “look back period” will be extended from 3 to 5 years. The look back is the number of years prior to filing a medicaid application that financial information, including gifts and other transfers must be disclosed. If gifts or transfers are made more than 5 years prior to application, then such transfers will not effect Medicaid eligibility.

* Prior law required that a“transfer penalty” be imposed on elders who make gifts within the look back period. The length of the Medicaid ineligibility penalty depended on the amount of the gift and started in the month the gift was made. The new law imposes the Penalty Period starting from when the applicant enters the nursing home and would otherwise be eligible for Medicaid benefits - that is, when all of their funds are gone! This eliminates most gift giving unless gifts are made beyond the 5 year look back period.

* The assets a community spouse is allowed to keep for support and maintenance will be substantially reduced under the new “income first rules” now mandatory for all states. MA already implements this rule.

* If the equity in your home is above $500,000, the state can deny you Medicaid benefits unless your spouse or disabled child lives in the home.
* Purchase of life estates, mortgages and annuities are now under much greater scrutiny. For example, the purchase of an annuity will be penalized unless the state is named as a remainder beneficiary.

Most individuals who make gifts are not aware of the possible consequences. A person who has spent down their resources may enter a nursing home only to discover they are ineligible for Medicaid because of payment for a grandson’s college tuition or a gift to a needy child. If they have no funds, nursing homes will have the unpleasant choice of continuing care without pay or evicting the resident. Nursing homes are already struggling financially, and this additional burden will further strain their resources. Some are calling the new laws the “Nursing Home Bankruptcy Act of 2005”.

If that’s not scary enough, 30 states (not MA yet) now have laws that require children to be responsible for supporting their parents. States could impose civil/criminal penalties against children. This may trigger collection law suits against children by nursing homes.

THERE IS STILL TIME TO ACT IF YOU ARE IN OR ABOUT TO ENTER A NURSING HOME. BUT TIME IS SHORT! YOU MUST ACT NOW TO PROTECT YOUR ASSETS BEFORE MA ADOPTS THE NEW LAWS .