Several
issues of the Elder Care Law
Alert, have discussed various sections of the legislation that was HB
1500, then HB 1168 and has
now become Act 42. This
article will discuss two additional sections:
441.7 - Income for the
Community Spouse; and 441.8 Home and Community Services.
Selected Provisions of
Act 42 that most directly affect seniors are available on this website at
the following link: http://www.paelderlaw.com/pdf/selected_provsions.pdf
Section 441.7:
Income for the Community Spouse
Section 441.7 changes
the methodology used to determine how the community spouse's minimum
income allowance is funded. The
change targets community spouses who have incomes below federal minimum
impoverishment standards.
Before 1988, Medicaid
rules often resulted in almost all of a married couple's income and
savings being paid to the nursing home when one of them needed such care.
This could leave the healthy "community" spouse with inadequate
financial resources to pay for her necessities of life.
As a result, Congress
passed a law that required States to allow the healthy spouse to retain at
least minimum amounts of income and savings.
These Medicaid provisions help ensure that community spouses are
able to retain sufficient resources to live out their lives with a modicum
of independence and dignity.
Act 42 changes the
method by which the community spouse's protected income and resources
are calculated so that the amount of savings that a low income community
spouse can retain is greatly reduced.
It limits the amount of assets that a community spouse can own
under the "resource-first" (Hurly) procedures.
In addition, the new
law forces the community spouse to overcome substantial administrative
burdens to get this new, more limited, Hurly entitlement.
The community spouse must (1) apply for Medicaid at the right time,
(2) receive a denial, (3) file an appeal from the denial, (4) enter into a
stipulated agreement with the Department of Public Welfare (DPW), and (5)
then purchase a special restricted annuity with part of the Spousal Share.
The annuity must name DPW as contingent beneficiary.
These requirements are
going to be an enormous challenge for seniors, especially those who have
physical or cognitive impairments.
Section 441.8:
Eligibility for Home and Community-Based Services
Until now, the assets
of the non-applicant spouse were disregarded in determining an
individual's financial qualification for the Medicaid funded PDA 60+
Home Waiver program. Section 441.8 requires that the resources of the
non-applicant community spouse be counted in the future.
Thus the financial qualification rules for home care are now
similar to the rules for nursing facility care.
As a result of Section
441.8, many married individuals who are now receiving home care services
under the Waiver program, will lose their benefits. The new law will also make
it much more difficult for married individuals to qualify for Waiver
services. It is likely that
the time between application and eligibility determination will also be
extended even for those who do qualify.
The enactment of
Section 441.8 will greatly reduce the number of nursing facility
clinically eligible married individuals who will be able to qualify for
Medicaid financed home care. This may result in several potentially
negative fiscal consequences for state funding of long term care services:
1.
State expenditures on home care services under the completely
state-funded OPTIONS program will increase because that is a primary
public financing alternative for individuals who fail to qualify for the
mostly federally funded Medicaid Waiver programs.
2.
Some individuals who could appropriately have received home care
under Waiver will be forced into more costly nursing facilities.
Section 441.8
represents a curious policy decision by the state.
By reducing the
incentives for home based care, and forcing some seniors into more
expensive nursing homes this change is, at best, a two-edged financial sword.
The change could end up costing Pennsylvania
more than it saves, especially since most
of the Medicaid program savings are passed through to the federal
government.
Postponement or
Repeal?
Act 42 will place
significant new costs and burdens on Pennsylvania
's neediest low income seniors. Unfortunately, most of the additional
dollars generated by these changes will not remain in Pennsylvania
but will be passed along to the federal
government.
Act
42 was enacted as part of the recent rushed budget process, with little
forethought by the State Legislature. Hopefully, given the policy
considerations involved, the Legislature and Governor will take the time
to review and then postpone the most ill-considered provisions of the new
law.
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