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Elder Law Center One Essex Street Saugus, Massachusetts 01906 Telephone 781.233.4444 Fax 781.231.2222
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SENATE BUDGET FAVORS SENIORS
Today I am writing to you from Hilton Head, South Carolina. I am here attending the 2004 National Academy of Elder Law Attorneys Annual Symposium. The theme of this year’s Symposium is Planning for Persons with Disabilities(and golf). Disabilities for this purpose is a very broad category including anyone on public benefits regardless of age or those who have children who are on public benefits. On May 12, 2004 the Senate Ways and Means Committee released their fiscal year 2005 budget. Debate on the budget ended last Thursday night and it is now in the conference committee. The Senate budget has the following provisions that are in favor of elders in Massachusetts:
· Repeal of Expanded Estate Recovery · Repeal of Authorization to Seek Federal Waiver · Expansion of MassHealth Community-Based Waiver · More Stringent Nursing Home Admission Standards repealed · Nursing Home Bed Hold restored. · Homestead exemption increased to $500,000 Late in 2003 I wrote an article entitled The Wholesale Assault On the Finances of Elders. It seemed like every couple months we were informed of another change to the MassHealth rules that adversely affected seniors. The Senate recognized that many of the MassHealth changes made in 2003 were hurting seniors and has done a good job to fix some of those problems. One major change that hasn’t been addressed in this budget is the change from being an Asset First state to an Income First State. Elderly women who need to place their spouse in a nursing home are the typical victims of this budget cutting law. The change requires these elderly women to spend most of their money on their spouse’s nursing home care. It does allow an allocation of a portion of the nursing home spouse’s income, but what happens when the spouse in the nursing home dies? Many times their retirement stops upon death. Now the elderly woman has no assets and no income. How can she continue to live in the community? This is a question that you should be asking your legislators. The repeal of the Expanded Estate Recovery is listed in sections 234, 235 and 241 of the Senate budget. Recently, I reported about the budget that was passed by the House of Representatives. The House budget repealed the Expanded Estate Recovery law. The Senate budget also repeals the Expanded Estate Recovery law. This is good. One technical point is that the House repealed the law by restating the section dealing with estate recovery, the Senate repealed the law by repealing the sections of the fiscal 2004 budget that created the Expanded Estate Recovery. Because differences between the House and Senate budget need to go to a conference committee, Senator Thomas McGee has entered amendment # 542 that would make the Senate language repealing the Expanded Estate Recovery the same as the House, thereby avoiding the extra step of going to the conference committee. I had a lengthy conversation with Senator McGee who indicated that he is committed to the elimination of the Expanded Estate Recovery. Senator McGee also explained that Governor Romney retains the right to veto any line item in the budget that is presented to the Governor. Senator McGee said that he is ready to fight and do what ever is needed to override the veto, if Romney does in fact veto this section. Senator Barrios is also supporting the repeal of this section. The next time you see either Senator Barrios or Senator McGee, you should give them a BIG THANKYOU. They are fighting for your rights!. Passage of this section would be a huge victory for the families of anyone who is unfortunate enough to need nursing home care. By passing this law, MassHealth (Medicaid) will only be able to recover against the probate assets of a decedent, who had been in a nursing home, and was receiving MassHealth benefits. Probate assets are made up of assets that are in the decedent’s name alone. Examples of probate assets are bank accounts, stock or real estate that is in the decedents name alone. Repeal of the Expanded Estate Recovery would mean that the house of a married couple, that is in joint names, will not be subject to attachment upon the death of the nursing home resident. It also means that proceeds from life insurance will also be exempt. Under the Expanded Estate Recovery life insurance companies were required to check with MassHealth to see if there was any lien prior to paying out the proceeds. This was a very unfortunate rule because many people bought the life insurance to pay for funeral expenses. Section 233 of the Senate Budget repeals the authorizing legislation that authorizes the Governor to seek a waiver from the Federal Medicaid rules. On August 28, 2003 the Governor requested a waiver from the Federal Government for some of the Federal Medicaid Rules. This would allow the Governor to ignore Federal Medicaid Rules and make up his own. Romney is seeking an increase in the look-back period along with an extreme change in the way penalties are computed for having made gifts. Under the current rules, gifts made over 3 years ago are protected, unless a trust is used, which allows a 5 year look-back. The waiver would change the 3 year look-back to 5 years and the 5 year look-back to 10 years. But the worst part of the waiver is that it considers all gifts made during the look-back period as occurring on the day you enter the nursing home or the date you apply for benefits which ever is later. In other words, the disqualification period never really starts and all gifts made during the applicable look-back period are treated as if you made them the day you entered the nursing home. Another bonus that the Senate threw in was an increase in the homestead exemption from $300,000 to $500,000. Although a homestead does not provide any protection from the costs of long-term care, it does provide protection for your home if you were to be sued for any reason. This article gives general information and not specific advice on individual matters. Persons wanting individualized advice on matters discussed should contact an advisor experienced in those matters. To the extent this article provides information on legal matters, it is based on law in effect in Massachusetts on the date of posting (laws in effect in other states are often quite different). Ronald H. Surabian is a CPA and attorney who works at the Elder Law Center in Saugus, Massachusetts. He also holds a masters in accounting and a masters in tax law. He currently serves on the board of directors of the Massachusetts Chapter of the National Academy of Elder Law Attorneys. If you have any questions please call me at the Elder Law Center, One Essex Street, Saugus, MA 01906 (781)233-4444. To view this or any prior article, please visit our web site at www.elderlawcenter.org. |
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