Connecticut
Proposal Would Have Drastic Effects on
Nursing Homes and Their Residents
Written By:
Jeffrey
A.
Marshall
, CELA*
Every
state is looking for ways to lower its Medicaid costs.
This trend is likely to continue throughout the
United
States
for
the foreseeable
future.
Connecticut
provides
a particularly stark example of how far state Medicaid Agencies may be
willing to go to shift the cost of long term care onto families and
nursing homes.
Federal
Medicaid law requires states to impose a penalty on certain transfers of
assets. The penalty is that
the person who makes the transfer and his or her spouse are made
ineligible for benefits for a period of time.
The penalty period starts to run on the date the asset is
transferred.
The
Connecticut Department of Social Services is seeking Federal Government
approval to increase transfer penalties and change the way they are
calculated. Despite the
opposition of the Legislature, advocates for seniors, and nursing home
trade groups, the Governor has submitted a waiver request to the Federal
Government.
Under
Federal law, the Secretary of HHS has broad authority to waive provisions
in federal Medicaid law so that states can experiment with innovative ways
to provide Medicaid financed services.
Connecticut
is
seeking a waiver that will allow it to have the transfer penalty period
begin on the first day the applicant would otherwise be eligible for
Medicaid rather than on the date the asset was transferred.
This means that if you gave $1,000 away to each of your five
grandchildren two years ago, and now you need to apply for Medicaid
benefits, you won't qualify for a month or so because of the gifts you
made two years prior.
Under
the
Connecticut
proposal, the benefit
ineligibility period starts to run only when the nursing home resident is
otherwise out of assets to use to pay for care.
This spells disaster for the nursing home.
The resident will have no way of paying for care, and Medicaid
won’t pay. The nursing home
will not be able to discharge the resident, due to federal laws requiring
appropriate “discharge planning.”
The result – the nursing home will have to provide care to the
resident for the duration of the penalty period.
Connecticut
will save money by
shifting the cost of care onto the nursing home.
Connecticut
states
that its waiver proposal is intended to encourage people to buy long term
care insurance. Whether or
not some additional citizens purchase insurance, the most obvious
consequence will be hard times for nursing homes in the state.
In
recent years, the federal government’s policy has allowed states to do
pretty much what they want in terms of waiver requests.
But, the Secretary may recognize the impracticality, injustice, and
poor policy underlying the proposal and deny the waiver.
In
its waiver proposal,
Connecticut
states
that one of its goals is to test out this new way for states to save
Medicaid dollars, so that other states can follow its example.
We can expect that other states, including
Pennsylvania
,
will be watching closely.
Health
Care Spending Up Sharply
Written By:
Attorney
Jeffrey A. Marshall
, CELA*
The
Centers for Medicare and Medicaid Services (CMS) has announced that health
care spending is continuing its dramatic rise.
In 2001, expenditures on health care rose 8.7% to a total of $1.4
trillion. This accounts for
14.1 percent of the total
US
economy, the highest share ever.
(Each year during the period 1992-2000, health care accounted for
only 13.1 to 13.4 % of the overall economy).
Despite the existence of 41
million uninsured Americans, health care spending is a much larger portion
of the overall economy in the
United States
than in other Western nations.
By comparison, health care spending amounted to 10.7% of the
economy in
Switzerland
, 9.5% in
France
, and 9.1% in
Canada
[in 2000].
In 2001,
US
health care spending averaged
$5,035 per person. Medicare
spending rose 7.8%, and Medicaid increased 10.8%.
Private health insurance premiums rose 10.5%.
The steep increase in health
spending puts particular pressure on state governments.
The states are struggling with financial problems due, in part, to
the poor economy. The
increases in Medicaid spending are particularly troublesome for states
since they pay a significant proportion of Medicaid costs (46% in PA).
The soft economy is leading to increased Medicaid enrollment as is
the growth in the elderly population.
As a result, most states, including
Pennsylvania
, are seeking ways to limit the
spiral in government health costs. In
Pennsylvania
, health spending accounts for a
third of our $21 billion annual budget.
Of this amount, $4.4 billion is spent on health care for seniors.
Governor Rendell has
introduced Rosemarie Greco as director of the Pennsylvania Office of
Health Care Reform, a new government agency that will look for ways to
streamline and improve the way the state delivers health-care services.
The new Office's goal will be to work with the departments of
health, aging, insurance, and public welfare to find ways to streamline
operations, improve access to services and ultimately save tax money.
Does Your Club Or
Organization Need A Speaker?
If
you are interested in having an attorney or geriatric planning specialist
from
The
Elder Law Firm of Marshall & Associates speak to your group, or at an
upcoming event, please contact
our
Public Education Coordinator, Melissa
Bottorf
at
mbottorf@paelderlaw.com or
1-800-401-4552
New
Jersey Court
Refuses to Permit Medicaid Planning By
Guardian
Written By:
Attorney
Jeffrey A. Marshall
, CELA*
A
New Jersey Appeals Court has refused to permit a guardian to do
Medicaid planning for his mother. The
guardian/son wanted to sell his mother’s house, gift himself a portion
of the proceeds, and use the rest to pay for his mother’s care through
the penalty period. Since
there was no power of attorney to authorize this action, he needed to seek
authority from the Courts. The
Court refused to allow the planning even though all members of his
mother’s family approved, and her court-appointed lawyer did not object.
In the Matter of Keri (N.J. Super. Ct. App.Div., No.
A-5949-01T5,
Dec. 19, 2002
).
The New Jersey Court noted that Courts in other states, notably
New York
, have permitted such planning by
guardians. It also noted that
it might have made a different decision if the assets were to be
transferred to a spouse rather than a child, or if the mother had
indicated a preference for Medicaid Planning while competent.
The Keri
case is indicative of how important it is to have a power of attorney
document that authorizes your family to act in accordance with your
wishes, in the event you ever become incapacitated.
Under
Pennsylvania
law, your power of attorney
should grant your agent specific authority to gift assets if you want your
agent to be able to protect them from the costs of long-term care.
Whether you should give this power to your agent, and how you can
protect yourself from its abuse, are questions you should discuss with a
lawyer who has experience dealing with these issues.
Minimum
Holding Period for both Series EE and I Bonds Extended to 12 Months
Written
By:
Karen
A. Griswold, Estate Planning Paralegal
The
minimum holding period for both the Series EE and I bonds has been
extended from six months to twelve months, effective with issue dates on
or after February 1, 2003. Series
EE and I bonds with an issue date prior to
February 1, 2003
, will keep the six month minimum holding period.
The minimum holding period is the length of time from the date of
issue that a bond must be held before it is eligible for redemption.
Additional information can be found on the web at www.savingsbonds.gov.
Medicaid
Misconception #3…
Medicare
Will Take Care of the Bills
Here
is the next instalment in our discussion of some of the most prevalent
misconceptions about Medicaid and the rules for payment of nursing home
costs.
Misconception
# 3:
Medicare
will take care of the bills
The
Truth:
Medicare is very different from Medicaid.
Medicare is the great government-run health care insurance system
for the elderly. Over 95% of
Americans over 65 have health care coverage through Medicare.
Unfortunately, Medicare has rules that severely restrict its use in
paying for nursing home care.
Traditional
Medicare requires a three-day hospital stay within 30 days of your nursing
home admission, and the receipt of daily skilled care in the nursing home.
Otherwise, you get no payment from Medicare or your Medicare
Supplement policy. Most
people residing in nursing homes are not receiving what Medicare considers
to be skilled care. ("skilled care" is care which involves
skilled nursing or rehabilitative personnel such as registered nurses,
LPNs, or physical therapists). As
a result of these restrictions, a majority of people who enter a nursing
home don't get any Medicare coverage at all.
And
even if you do qualify for Medicare, it will only pay for a limited period
of time. As long as you meet
the prior hospitalization and skilled care requirements, Medicare will pay
in full for the first twenty days. After
that, if you continue to meet the skilled care requirement, you must pay
the first $105.00 [in 2003] a day and Medicare will pay the rest of the
daily bill. (Many people have
Medicare Supplement or Managed Care coverage that will pay the initial
$105.00 for them).
In
practice, very few nursing home residents qualify for more than a few
weeks of Medicare coverage for nursing home costs; even if they do, after
100 days, Medicare will stop paying for any nursing home costs.
As a result of all these limitations, Medicare just isn't as much
help as most people expect when they need nursing home care.
Since
Medicare isn't much help, most nursing home residents are forced to pay
the costs themselves out of their income and savings, and the savings of
their spouse, until they qualify for the Medicaid program. Medicaid,
not Medicare, is the government program that provides significant coverage
for long term nursing home care. Over
2/3rds of nursing home residents receive benefits under Medicaid.
Other
examples of Medicaid Misconceptions are posted on the Marshall &
Associates website at www.paelderlaw.com
.
In
future editions of the Elder Care
Law Alert, we will discuss
additional
Medicaid misconceptions…
Stay
Tuned!
Mark
Your Calendars!
“Understanding the Rules: Medicaid
Payment for Long Term Care”
A
Free Seminar Presented by
Marshall
& Associates
-Saturday,
February 8th, 10 AM, The Woodlands,
Wilkes-Barre
-Thursday,
February 13th,
6:30
PM
,
The Radisson,
Scranton
-Tuesday,
February 18th,
6:30
PM
,
The Best Western, Lock Haven
-Saturday,
February 22nd, 10 AM, The Radisson,
Williamsport
-Thursday,
March 6th,
4:00
PM
,
The Woodlands,
Wilkes-Barre
-Saturday,
March 8th, 10 AM, The Comfort Inn,
Hazleton
-Wednesday,
March 19th,
6:30
PM
,
The Patriot Inn, Bloomsburg
Reservations
are suggested, but not required. SIGN
UP ONLINE or call 1-800-401-4552 for more information or to
reserve your spot for one of these seminars!
To subscribe or unsubscribe to the Elder News Alert,
please
send a request to:
webmail@paelderlaw.com
*Attorney
Marshall
is certified as an
Elder Law Attorney by the National Elder Law Foundation under
authorization from the Pennsylvania Supreme Court
© 2000-2005
Marshall & Associates www.paelderlaw.com
