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Medicaid

Tuesday, November 7, 2017

Can Medicaid place a lien against the apartment?


Recently someone asked me a question: if an co-op apt. is owned jointly by spouses with right of survivorship, can Medicaid enforce a lien against the estate or the decedent's interest in the co-op when the joint owner who was a Medicaid recipient dies?

There is a prohibition against placing a lien on the estate of a deceased Medicaid recipient if the recipient is survived by a spouse. As long as there is a surviving spouse, there can be no lien against the estate of the deceased Medicaid recipient.
But - the Medicaid lien is held in abeyance. When the second spouse dies, a lien can be placed against the second spouse's estate to recover Medicaid benefits paid to the first spouse.
Read more . . .


Tuesday, July 11, 2017

If you plan on growing old, the Medicaid debate affects you!


One in three people who turn 65 end up in a nursing home. No one ever wants to go there, yet most of the time the family has no choice about this issue (it becomes dangerous to keep the person at home, the daily care required is too much for a home care aide, etc). 

In New York and in New Jersey nursing home now costs $15-$20K a month! The vast majority of people cannot pay this bill on their own, especially after years of retirement spending. Even if the person wants to stay at home, an average home care bill is $10-$12K a month, which, for most people is also unaffordable based on Social Security pensions and retirement savings.

Currently, Medicaid pays for home care and nursing home care.
Read more . . .


Tuesday, May 16, 2017

Medicare does not pay for home care!


Even though some seniors may be entitled to home care through their Medicare benefits, it may be impossible for them to receive this needed care.

And that is why most people plan for Medicaid - not because they are trying to cheat the system, but because they have no other real choice. 

 

http://www.
Read more . . .


Wednesday, January 27, 2016

Can You Avoid a 5 Year Penalty for Uncompensated Transfers?

Medicaid imposes a transfer penalty that can last for up to 5 years for all uncompensated transfers made prior to the application for nursing home Medicaid. This provision makes crisis planning for nursing home not efficient. Yet many people are reluctant to transfer their assets ahead of time and impoverish themselves, because, of course, no one knows when nursing home will be needed.

One way of avoiding the nursing home penalty is to prove to Medicaid that the transfer was made not for the purpose of Medicaid giving. For example, grandmother has a history of gifting large amounts of money to grandchildren, and continues doing so for several years while being in good health. If, at some point, she has a stroke and has to go to a nursing home, Medicaid will deny her application, claiming that the money gifted was an uncompensated transfer. The family can then appeal and try to prove to an administrative judge that the transfers were done while she was in good health and not as part of Medicaid planning.

This is an affirmative defense, meaning that the burden is on the family to prove their point, not on Medicaid to prove the opposite. If there is no evidence that grandmother was in good health while gifting the money, and if there is no pattern of gifting the money, the petition will likely be denied.

Disclaimer: This article only offers general information.  Each situation is unique. It is always helpful to talk to a specialized attorney, to figure out your various options and ramifications of actions.  As every case has subtle differences, please do not use this article for legal advice. Only a signed engagement letter will create an attorney-client relationship. ATTORNEY ADVERTISING


Monday, November 30, 2015

What is Long Term Care Insurance and New York State Partnership for Long Term Care

Many seniors are not aware that Medicare does not pay for custodial long term care. An individual suffering from Alzheimer’s disease or dementia, which requires assistance with feeding, bathing, and taking oral medications will not be covered by Medicare not by a Medigap insurance. The only way of paying for custodial long term care are: private payments, Medicaid, or Long Term Care Insurance.

Long term care: this is care that can be provided in the home, in a nursing home or in an assisted living facility. Eligibility for benefits is based on medical necessity as evidenced by an individual’s inability to perform a specified number of personal functions (activities of daily living): bathing, toileting, dressing, self-feeding, lack of mobility or loss of cognitive capacity.

Home Care: Most long term care insurance policies have a home care component. It is usually beneficial for an elderly person to continue to reside at home: familiar surroundings, familiar people and familiar foods provide comfort and control. The long term care insurance policy can pay for the number of hours required by the patient. This is a large improvement over Medicaid: individuals relying on public programs (Medicaid) frequently find that the number of hours authorized may be significantly less than what is required for the individual’s health and safety.

Coverage Provisions: These vary, depending on the need and the willingness to pay. In New York, a policy must offer at least 24 consecutive months of coverage. Each policy generally provides for a specified payment level, based on whether care is received at home, in an assisted living facility or in a nursing home. If the cost of care exceeds the policy benefit, the full benefit will be paid. If the cost of care is lower than policy benefit, the actual cost will be paid. Most policies contain a deductible, usually measured in days. The benefit period can be as short as two years, and as long as the life of the insured, with everything in between.

Exclusions: certain conditions are excluded by long term care insurance policies. These are, among others: alcoholism and drug additions, attempted suicide or intentionally self-inflicted injuries, mental and nervous disorders (except Alzheimer’s disease or demonstrable organic brain disease).

New York State Partnership for Long Term Care

These are specific long term care insurance policies approved by the New York Partnership policy.

Under a Total Asset Protection plan, the insurance policy will pay for the first three years nursing home care or six years of home care or a combination of the above (where two home care days are equal to one nursing home day). Individuals who have received these specified Partnership long term insurance benefits may apply for Medicaid and be eligible without regard to the value of their assets. Individuals may sell, transfer spend or retain assets, before during and after applying for Medicaid nursing home care – the penalty period does not apply. However, the Medicaid income levels will still be applied.

The policy premiums depend on age and coverage chosen. The Partnership policies are generally slightly more expensive than other policies. Annual premiums for a basic policy can range from $2,800 for a 40 year old to $13,000 for an 80 year old. However, the benefit is the ability to apply for Medicaid without transferring assets. All aspects must be considered and analyzed before a decision is made.

Disclaimer: This article only offers general information.  Each situation is unique. It is always helpful to talk to a specialized attorney, to figure out your various options and ramifications of actions.  As every case has subtle differences, please do not use this article for legal advice. Only a signed engagement letter will create an attorney-client relationship. ATTORNEY ADVERTISING.


Sunday, November 22, 2015

Can relatives supplement Medicaid covered nursing home care by paying for private nurses and private rooms?

Even though this concept appears reasonable (after all, most nursing homes are short on staff and rooms are semi-private at best), Medicaid does not permit it.

Medicaid is a payor of last resort: if there are any available sources of payment then these sources must be used first. If a resident, or anyone else on resident’s behalf pays for private nursing services, then it is considered a payment for a service for which Medicaid is already paying. As a result, Medicaid would then have to reduce its payment to the nursing home by the amount being private paid for the nursing services. This reduction would be unacceptable to the nursing home.

Similarly, Medicaid and Medicare pay a fixed fee to the nursing home for any room in the facility. As a result, Medicaid rate for a private room would be the same as the rate for a semi-private room. Therefore, most nursing homes reserve private rooms for private paying residents. Some relatives want to supplement the nursing home by giving additional payment for a private room. However, Medicaid would look to the private payment and reduce its payment to the nursing home by the amount of this private payment. The end result would be a nursing home receiving a similar rate for a private room and a semi-private room, which is not an acceptable business model. 

If a nursing home would accept a privately paid supplement on behalf of a Medicaid resident, either for a private room or for a private nurse, and if this payment was not reported to Medicaid, the nursing home would be committing Medicaid fraud. The consequences, both civil and criminal, are such that nursing homes are usually unwilling to discuss these supplements.

The one method that is available to supplement the nursing home care is to hire a “companion” to a Medicaid resident. Companion services are not considered medical, as a result they are not provided in the Medicaid nursing home rate. Placing a companion with a Medicaid resident will not have an effect on Medicaid payments. A skilled companion may provide various services to the resident, including bathing, toileting and feeding the resident.

Disclaimer: This article only offers general information.  Each situation is unique. It is always helpful to talk to a specialized attorney, to figure out your various options and ramifications of actions.  As every case has subtle differences, please do not use this article for legal advice. Only a signed engagement letter will create an attorney-client relationship.


Friday, November 13, 2015

Accident Liens – can Medicaid recover from personal injury or malpractice award?

It may come as an unwelcome shock to many personal injury plaintiffs, but Medicaid is entitled to recover medical expenses paid on behalf of an individual, from the proceeds of a personal injury or a malpractice action.

The entire award is subject to Medicaid recovery: there is no distinction between pain and suffering and medical expenses, both portions of the award are subject to Medicaid liens. Unlike estate claims, there is no limitation on the age of the recipient for Medicaid to impose its lien.

Limitations

The lien is limited to Medicaid payments made after the date the injuries were sustained. The lien is also limited to those Medicaid payments made for the treatment of injuries sustained. The rationale is that Medicaid is not entitled to recover for Medicaid properly paid (other than from estate claims).

One final limitation is that Medicaid is not entitled to a recovery when the claim is against a nursing home based on negligence or abuse of a Medicaid patient.

Legal Fees

Medicaid lien has the priority over all other liens, with the exception of the attorney fee for representing the injured party in an action to recover for the injuries in the accident. However, the attorney is not entitled to a fee from the proceeds being paid to Medicaid.

 

Disclaimer: This article only offers general information.  Each situation is unique. It is always helpful to talk to a specialized attorney, to figure out your various options and ramifications of actions.  As every case has subtle differences, please do not use this article for legal advice. Only a signed engagement letter will create an attorney-client relationship.


Tuesday, October 20, 2015

When is Medicaid entitled to recovery of benefits paid? Part 1

  1. If Medicaid was paid improperly, the Department of Social Services is entitled to recover all improperly paid benefits.

         If Medicaid discovers that an individual was ineligible because the information provided was false, there will be 3 steps taken. First, any further medical assistance will be discontinued. Second, the case can be referred to the local District Attorney office for criminal prosecution. Third, a lawsuit for the civil recovery may be commenced, to recover the money overpaid.

         The first step in this process is usually a letter, received by Medicaid recipient, informing him that he is being investigated for Medicaid fraud, and asking him to come in for an interview.

 

2.     Medicaid is entitled to recover from the estate of anyone who was 55 or older when the assistance was granted. However, this recovery is limited by several important considerations:

  1. The recovery is limited to benefits paid within 10 years of individual’s death.

  2. Medicaid is excluded from making a claim against the estate of an individual who is survived by a spouse, a minor child, or a disabled child. However, the lien is held in abeyance only. Once the surviving spouse dies, a lien can be placed against the second to die spouse’s estate to recover Medicaid benefits paid to the first spouse.

  3. Medicaid may only make the recovery from the probate assets of an individual (those assets that pass under a will or by administration if there is no Will, and not part of a revocable trust, life estate or joint tenancy agreement).

Medicaid is a preferred creditor. As a result, Medicaid’s lien must be satisfied before other creditor’s claims and before any bequests to beneficiaries are distributed.

Most Medicaid liens can be negotiated.

3. Medicaid is entitled to recover from the proceeds of an action arising from an accident or malpractice, as the result of which the injured party received Medicaid benefits.           

Disclaimer: This article only offers general information.  Each situation is unique. It is always helpful to talk to a specialized attorney, to figure out your various options and ramifications of actions.  As every case has subtle differences, please do not use this article for legal advice. Only a signed engagement letter will create an attorney-client relationship.


Wednesday, June 3, 2015

Is Divorce the Best Option for People Over 65?

Your parents may have had a long and relatively happy marriage. They may intend to live together until their death. Nonetheless, the financial reality of today’s government rules may force them to consider divorce.  And there is no need for psychological counseling at this point. Divorce, with future cohabitation, would be done simply to qualify for long term care benefits.

Current Medicaid rules tacitly encourage divorce. In New York State, for people over 65, to qualify for Medicaid as an individual, one cannot have income of greater than $825 a month. A married couple cannot have income of greater than $1,209. Clearly, a divorced couple can shelter a greater amount of income than a married one. Furthermore, an individual on Medicaid cannot have assets of greater than $14,850. A married couple cannot have assets of greater than $21,750, again, penalizing a couple and encouraging divorce.

When only one spouse needs Medicaid (in order to receive home care or nursing home care), divorce may simply become a necessity in order to shelter some of the assets.  A ‘community spouse’ (the spouse which is not receiving Medicaid) is permitted to keep no more than $119,200 of assets, and no more than $2,980 of income per month. Any excess above these numbers may be subject to a Medicaid recovery lawsuit. As a result, the sick spouse may transfer all of his assets to his spouse, and then the spouses divorce.

The information in this blog was adapted from

http://www.huffingtonpost.com/rev-amy-ziettlow/is-divorce-the-best-option-for-older-americans_b_6878658.html

 

Disclaimer: This article only offers general information.  Each situation is unique. It is always helpful to talk to a specialized attorney, to figure out your various options and ramifications of actions.  As every case has subtle differences, please do not use this article for legal advice. Only a signed engagement letter will create an attorney-client relationship.


Thursday, March 26, 2015

Asset Protection Planning for the Home

Medicaid Eligibility:

What is homestead: A “homestead” is the primary residence occupied by the Medicaid recipient or his spouse, minor or disabled child. A homestead is an exempt resource for the purpose of Medicaid eligibility.

Penalty Period: All transfers, including the transfer of your home, are subject to a ‘look back period’ from the time of the application for Medicaid nursing home benefits. Currently the ‘look back period” is 5 years. The period of ineligibility for nursing home services is calculated by dividing (i) the uncompensated value of the transferred resource by (ii) the average regional monthly cost of a nursing home to a private pay patient. The period of ineligibility begins only when the Medicaid recipient is in a nursing home and “otherwise eligible”. The maximum penalty period is 60 months.

There is currently no look back period and no penalty for uncompensated transfers for Medicaid home care benefits.

Exempt transfers: Some transfers are exempt and do not incur a penalty period. Those are transfers to a spouse, transfers to a minor or disabled child, transfers to an adult child who has resided with the parent for at least 2 years prior to the transfer and became a primary caregiver, and transfers to a brother or sister of the owner who has lived with the owner for at least one year prior to the transfer and who already owns an ‘equity interest’ in the home.

Why should the home be transferred if it is an exempt resource? Even though it is an exempt resource, Medicaid has a right to put a lien on the home for the services provided to the Medicaid recipient. Therefore, even though one will have a right to receive Medicaid and a right to live in one’s home, after the Medicaid recipient’s death, the heirs will likely have to sell the home to pay off the Medicaid lien.

Furthermore, if the Medicaid recipient has to go into a nursing home and there is no spouse or minor / disabled child living in the home, the homestead becomes an available resource. At that point, it will likely have to be sold and the proceeds will be used to pay for nursing home.

Various Types of Transfers That Need to be Considered When Protecting the Home

  1. Outright transfer to a spouse

  2. Outright transfer to children / relatives

  3. Outright transfer with a retained life estate

  4. Transfer to a revocable trust

  5. Transfer to an irrevocable trust with a retained life estate

  6. Transfer to an irrevocable trust

Each type of a transfer has its own Medicaid, legal, asset protection and tax implications. The effect on the Medicaid recipient during his lifetime, the effect on the beneficiaries during the Medicaid recipient’s lifetime, and the effect on the beneficiaries after the Medicaid recipient’s lifetime should be considered.

There is no one correct solution that applies to everyone. Each situation is unique, and the client’s health, family status, resources and goals must be considered. It helps to talk to an elder law attorney, to evaluate the different options, and to understand the implications of your actions.

Disclaimer: This article only offers general information.  Each situation is unique. It is always helpful to talk to a specialized attorney, to figure out your various options and ramifications of actions.  As every case has subtle differences, please do not use this article for legal advice. Only a signed engagement letter will create an attorney-client relationship.


Monday, March 2, 2015

What happens with government benefits if one gets an unexpected windfall?

There are many government programs: SSI, Medicaid, food stamps, etc. Most of these programs have thresholds for recipient’s income and assets. What happens when recipients receive an unexpected windfall – inheritance, personal injury award, etc? Can one retain both the money and the benefits? Can one decline the award? The answer depends on the type of benefit in question: 

SSI

Qualification: In order to qualify for SSI, one’s assets cannot exceed $2,000 (if single) and $3,000 (if married). Any uncompensated transfers of assets done within 3 years of SSI receipt will incur a penalty.

Effect of a windfall: if the SSI recipient receives a windfall, it is considered income in the month of receipt, and asset if retained until the next month. Any transfer of the asset will incur a penalty and a disqualification from the benefit. The only exception to this rule is for people who are below 65 and disabled; they are permitted to transfer the windfall to a Special Needs Trust for the benefit of themselves without losing their SSI benefit.

What to do: consider the amount of money received. If the amount is small, you may consider spending the money on yourself in the month of receipt. There are many things that one can do – house improvements, payment of debts, food, clothing, vacation, etc. As long as the money is spent within 1 month, the recipient will retain his eligibility for future months. 

If, on the other hand, the amount is large, you may consider transferring the money to a trust / relatives and then losing the benefit for the next 3 years. The maximum amount of SSI benefit in New York for 3 years is approximately $29,000. If the personal injury is $500,000, the loss of $29,000 is not that significant.

 

Medicaid

Qualification: depends on the age of the recipient and the type of Medicaid care that one is receiving.

If below age 65, not an SSI recipient and no disabilities, Medicaid considers only one’s income. Assets are not considered. Income thresholds depend on the number of people in the family and whether or not there are children.

If after age 65, Medicaid considers both income and assets. An individual’s assets cannot exceed $14,750 and income cannot exceed $825 per month.

Asset transfers: If one receives only home care or medical care, then Medicaid does not impose a penalty on asset transfers. On the other hand, if one is in a nursing home or will apply for nursing home care in the next 5 years, Medicaid imposes a penalty of up to 5 years. 

Effect of a windfall: If a Medicaid recipient receives a windfall, it is considered income in the month of receipt, and asset if retained until the next month. If one is below 65, one may either retain the asset or transfer it, and retain his eligibility for the future months.

What to do: If a Medicaid recipient is above 65, consider the amount of money and the type of care that is needed. Generally, seniors depend on Medicaid as their medical insurance, therefore retaining the assets and losing the benefit may not be an optimal solution. Consider first spending the money on your immediate needs (paying down debt, house repairs, etc). Then consider transferring the remaining money. Remember that if nursing home is needed in the 5 years after the transfer, Medicaid may impose a penalty and deny the benefits.

This article only offers general information.  Each situation is unique. It is always helpful to talk to a specialized attorney, to figure out your various options and ramifications of actions.  As every case has subtle differences, please do not use this article for legal advice. Only a signed engagement letter will create an attorney client relationship.


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