Medicaid Power Point 2011

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2011 New York Medicaid

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  • Co-pay 109.50 (2004)
  • Medicaid Power Point 2011

    1. 1. Elder Law & Medicaid Planning Futterman & Lanza, LLP 222 East Main Street, Suite 314 Smithtown, New York 11787 631-979-4300. Attorneys & Counselors at Law Copyright © 2011 Futterman & Lanza, LLP
    2. 2. Vision Statement <ul><li>Preserving and protecting your family’s hard earned assets and passing them on to family members, not to the potentially catastrophic costs of long-term care (i.e., the nursing home). </li></ul>
    3. 3. What is long-term care? <ul><li>Long-term care is a variety of services that include medical and non-medical care to people who have a chronic illness or disability. Long term-care needs can be provided through: </li></ul><ul><li>(1) Home health care; </li></ul><ul><li>(2) Assisted Living facilities; </li></ul><ul><li>(3) Skilled nursing home facilities. </li></ul>
    4. 4. What are the costs of long-term care? <ul><li>Home health-care costs vary depending on the number of hours required and the hourly pay rate charged by the personal care aide. </li></ul><ul><li>Assisted Living costs range from $3,000/month to $8,000/month. </li></ul><ul><li>Skilled nursing care costs on Long Island range from $9,000 to over $17,000 per month. </li></ul>
    5. 5. Who is exposed to these costs? <ul><li>EVERYONE! </li></ul>
    6. 6. How do you pay for long-term care? <ul><li>(1) Medicare (limited benefit); </li></ul><ul><li>(2) Private pay; </li></ul><ul><li>(3) Long-term care insurance; or </li></ul><ul><li>(4) Medicaid. </li></ul>
    7. 7. Medic aid <ul><li>Medicaid is a “means tested” </li></ul><ul><li>insurance program jointly </li></ul><ul><li>funded by the federal, state </li></ul><ul><li>and local governments </li></ul><ul><li>(DSS), and provides home </li></ul><ul><li>care and skilled nursing </li></ul><ul><li>home care services. </li></ul>
    8. 8. Medicaid Eligibility <ul><li>Medical need </li></ul><ul><li>Financial need </li></ul>
    9. 9. Medicaid Financial Eligibility (Nursing Home) <ul><li>Resources </li></ul><ul><li>Income </li></ul>
    10. 10. Resources <ul><li>For 2011, an individual can have no more than $13,800 in resources. </li></ul><ul><ul><li>($218 increase) </li></ul></ul><ul><li>Community (“well”) spouse may retain resources up to approx. $110,000. </li></ul>
    11. 11. Exempt Resources <ul><li>Irrevocable Funeral Trust (no limit) </li></ul><ul><li>$1,500 burial fund </li></ul><ul><li>Primary residence (generally) </li></ul><ul><li>IRA’s or qualified retirement accounts if applicant is receiving RMD. </li></ul><ul><li>Personal property (jewelry, car, etc.) </li></ul><ul><li>Reparation payments </li></ul>
    12. 12. Income <ul><li>2011 Income Levels: </li></ul><ul><ul><li>New York is a “spend down” state with regard to income. Income over the personal needs allowance ($50/month) must be contributed toward the cost of care. </li></ul></ul><ul><ul><li>UNLESS – there is a community spouse with income under $2,739/month. </li></ul></ul>
    13. 13. Transfers <ul><li>Look Back Period </li></ul><ul><li>Penalty Period </li></ul>
    14. 14. Look Back Period <ul><li>Medicaid will now look back at applicant’s financial information for the 60 month period prior to the date applicant requests benefits. </li></ul><ul><li>THIS IS A CHANGE FROM 36 MONTHS!!!!!!!! </li></ul><ul><ul><ul><li>(THE RESULT OF THE DEFICIT REDUCTION ACT) </li></ul></ul></ul>
    15. 15. What is DSS Looking For? <ul><li>Looking to see if the applicant (or spouse) made uncompensated transfers of income or resources (i.e., gifts ) </li></ul>
    16. 16. What if DSS discovers a gift was made?
    17. 17. Penalty Period <ul><li>When gifts are made during the look-back period, Medicaid imposes a penalty or period of ineligibility for benefits. </li></ul><ul><li>OLD LAW - Penalty period commences on first day of the month following the gift. </li></ul><ul><li>NEW LAW - Penalty period commences on THE DATE INDIVIDUAL APPLIES FOR MEDICAID, IS FINANCIALLY ELIGIBLE FOR MEDICAID AND IS RECEIVING INSTITUTIONAL CARE (IN NURSING HOME). </li></ul>
    18. 18. Penalty Period <ul><li>WHEN THE APPLICANT IS AN “OTHERWISE ELIGIBLE INDIVIDUAL …. RECEIVING NURSING FACILITY SERVICES FOR WHICH MEDICAID COVERAGE WOULD BE AVAILABLE BUT FOR THE IMPOSITION OF A TRANSFER PENALTY.” </li></ul>
    19. 19. How long is the penalty period?
    20. 20. Penalty Period Calculation <ul><li>Divide the total gifts transferred during the look-back period by the current average monthly cost to a private-pay patient in a nursing facility in NYS (as determined by DSS). </li></ul><ul><li>The quotient equals the number of months the applicant will be ineligible for Medicaid benefits. </li></ul>
    21. 21. Current Average Monthly Costs <ul><li>SEVEN REGIONS </li></ul><ul><li>NYC $10,579 </li></ul><ul><li>Nassau & Suffolk $11,445 </li></ul><ul><li>Northern Metro $10,105 </li></ul><ul><li>Central $7,688 </li></ul><ul><li>Northeastern $8,323 </li></ul><ul><li>Rochester $8,942 </li></ul><ul><li>Western $7,863 </li></ul>
    22. 22. Exempt Transfers <ul><li>Transfers between spouses </li></ul><ul><li>Transfers to a disabled child of any age </li></ul><ul><li>Transfers to a Trust for the sole benefit of any disabled individual </li></ul><ul><li>Transfers for value (compensated transfer) </li></ul>
    23. 23. EXAMPLE <ul><li>Facts: Suffolk resident gifts $100,000 cash to his son on January 1, 2011. </li></ul><ul><li>Calculation: $100,000 / $11,445 = 8.74 </li></ul>
    24. 24. EXAMPLE <ul><li>OLD LAW: penalty period starts February 1, 2011 and ends on September 30, 201. Partial month is calculated at a dollar value based on the regional rate and considered as an income overage for the partial month. </li></ul>
    25. 25. EXAMPLE <ul><li>NEW LAW: 8.74 MONTH PENALTY PERIOD BEGINS THE DATE THE INDIVIDUAL APPLIES FOR MEDICAID, IS FINANCIALLY ELIGIBLE FOR MEDICAID AND IS RECEIVING INSTITUTIONAL CARE (IN NURSING HOME). </li></ul><ul><li>WHEN THE APPLICANT IS AN “OTHERWISE ELIGIBLE INDIVIDUAL …. RECEIVING NURSING FACILITY SERVICES FOR WHICH MEDICAID COVERAGE WOULD BE AVAILABLE BUT FOR THE IMPOSITION OF A TRANSFER PENALTY.” </li></ul>
    26. 26. Footnotes <ul><li>Community (“well”) spouse can make transfers without affecting institutionalized spouse’s eligibility only AFTER acceptance. </li></ul><ul><li>No “cap” on penalty periods. </li></ul>
    27. 27. Options for the Homestead <ul><li>Sell it </li></ul><ul><li>Transfer (gift) it </li></ul><ul><li>Life Estate </li></ul><ul><li>Transfer it into protective trust </li></ul>
    28. 28. Homestead – Sell it or Gift it <ul><li>What if the the Medicaid applicant sells the homestead and then transfers (gifts) the sale proceeds to his/her children? Similarly, what if the applicant transfers title to the house to his/her children? </li></ul><ul><li>The gift creates a penalty or ineligibility period beginning … WHEN THE APPLICANT IS AN “OTHERWISE ELIGIBLE INDIVIDUAL …. RECEIVING NURSING FACILITY SERVICES FOR WHICH MEDICAID COVERAGE WOULD BE AVAILABLE BUT FOR THE IMPOSITION OF A TRANSFER PENALTY.” </li></ul>
    29. 29. Homestead – Life Estate <ul><li>MA gifts remainder interest to the kids and retains a life estate for him or herself. </li></ul><ul><li>Penalty period is shortened (only gifting part of the real property) </li></ul><ul><li>Life estate in not considered a resource and is not attachable by Medicaid. </li></ul><ul><li>Life Estate does not afford the MA control of the ultimate disposition of the asset. </li></ul>
    30. 30. Homestead – Transfer Into Trust <ul><li>Trust provides MA with more control over the ultimate disposition of the asset. </li></ul><ul><li>Trust requires the MA retain the right to receive income from the trust for life. </li></ul>
    31. 31. Homestead – Exempt Transfers <ul><li>Spouse </li></ul><ul><li>Child under 21 </li></ul><ul><li>Blind/disabled child </li></ul><ul><li>Adult child, residing in home (2 years), that provided care to MA. </li></ul><ul><li>Sibling of MA who has equity interest in house and who has resided in home one year immediately prior to MA’s institutionalization. </li></ul>

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