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September 24, 2003 Saugus Advertiser
WRAP UP OF 2003 MEDICAID CHANGES
· January 1, 2003 – ASSET LIMITS CUT IN HALF. It cut in half the amount of assets a married couple can keep.
· July 31, 2003 – EXPANDED ESTATE RECOVERY. Next came the expanded estate recovery that allows the Division of Medical Assistance (DMA) to recover against assets that were protected under the previous rules. There is no grandfathering of assets that were protected.
· August 15, 2003 – ELIMINATION OF BED HOLD. Elimination of a benefit that allowed a nursing home resident to visit with family or leave for medical treatment. (Explained below)
· August 28, 2003 – ROMNEY FILES FOR FEDERAL WAIVER. This is a request to not use Federal Medicaid rules and make up new ones. (Explained below).
· September 1, 2003 – INCOME FIRST TAKES EFFECT. This rule affects all married couples who have one spouse in a nursing home. It effectively eliminates the opportunity to allow the spouse at home to keep excess assets.
The good news is that the Governor is not going to raise taxes! The bad news is what is happening to the finances of elders.
NURSING HOME BED HOLD POLICY
Prior to August 15, 2003 a nursing home had to hold a bed of a resident on medical leave for up to 20 days, during which time DMA would pay the facility to hold the bed. In addition, a resident was entitled to 15 days per year of non-medical leave during which time DMA would pay to hold the bed. DMA has issued emergency regulations effective August 15, 2003 which eliminate payment for medical and non-medical leaves of absence.
What this means is that if you would like to take Mom to see her grandchild get married in Florida, the nursing home will not hold Mom’s bed and she will only be able to return if there is another bed available. They would also not save your bed if you had to go to the hospital for an operation. THIS ISN’T FAIR!! This is the equivalent of making them prisoners of the nursing home. Many residents of nursing homes suffer from dementia and become additionally confused when they have to move to new surroundings.
FEDERAL WAIVER
The Governor has requested a waiver from the Federal Government of some of the Federal Medicaid Rules. It is not known exactly what the changes will be but it is understood that he will seek an increase in the look-back period. Under the current rules, gifts made over 3 years ago are protected. The waiver could seek up to a 10-year look-back. 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, that old 3-year period never actually starts to run so that all gifts made in the last ten years would be treated as if you made them the day you entered the nursing home.
Let’s say that Grandma gives grandson $20,000 to attend college and that 5 years later she needs nursing home care. Grandma will be ineligible for Medicaid because she gave money away during the 10-year look-back period. It doesn’t matter that the money has been spent. There are a lot of problems that will come up. That is probably why Connecticut, who received a Federal Waiver last year, still hasn’t been able to implement it.
Next week I’ll be covering Long-Term Care Insurance, the benefits and some of the traps for the unweary.
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, Ma. 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.