Medicaid Reimbursement Rate
In a prior post, there was an extensive discussion regarding such issues as when it is appropriate to make the nursing home representative payee, such decision and its relationship to Medigap insurance and the legend to be put on bank accounts for the community spouse and the applicant. This article ignores the Medigap issues and assumes that the nursing home should be designated representative payee (see Post 1).
A. Once eligibility is established, the nursing home receives the Medicaid reimbursement rate as payment. The actual amount paid to the nursing home by Medicaid is reduced by any recurring monies received by the individual such as social security and pension payments, which are to be remitted to the nursing home on a monthly basis.
B. Such payments received during any given month constitute resources on the “first moment of the first day” of the subsequent month.
C. The $2,000 threshold could be exceeded due to the lack of attention to automatic deposits of social security and pension payments to a Medicaid recipient’s checking account. As indicated in Post 1, pension payments cannot be assigned.
Planning Point: Once the date of eligibility is near, counsel should advise and assist the responsible family member to designate the nursing home as representative payee for social security benefits of the Medicaid recipient. Social security payments will then be made directly to the nursing home. The danger of disqualification due to inadvertent accumulation of social security monies will be eliminated.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© June 2009, Post #44
Monday, June 29, 2009
Monday, June 22, 2009
Transfers for a Purpose Other than to Qualify for Medicaid
Transfers for a Purpose Other than to Qualify for Medicaid
Another exemption from the transfer rules is a transfer exclusively for a purpose other than to qualify for Medicaid.
I recently had a case in which a 78-year old father transferred approximately $40,000 to pay for his child’s wedding. The father was as healthy as an individual his age could possibly be and had no thought of going into a nursing home.
Generally, the position of Medicaid is that it is extremely difficult to show that Medicaid was not one of the reasons for the transfer. However, presented with such a case, points to be stressed are the health of the individual at the time, the uniqueness of the purpose of the transfer (i.e. wedding of child) and additional points that would negate Medicaid ineligibility (such as, the child voluntarily making payments back to the father before Medicaid was even an issue). The gentleman passed away before Medicaid was able to make its determination.
The key point of the above analysis is that a representative should never give up if there are valid arguments in favor of the applicant.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© June 2009, Post #43
Another exemption from the transfer rules is a transfer exclusively for a purpose other than to qualify for Medicaid.
I recently had a case in which a 78-year old father transferred approximately $40,000 to pay for his child’s wedding. The father was as healthy as an individual his age could possibly be and had no thought of going into a nursing home.
Generally, the position of Medicaid is that it is extremely difficult to show that Medicaid was not one of the reasons for the transfer. However, presented with such a case, points to be stressed are the health of the individual at the time, the uniqueness of the purpose of the transfer (i.e. wedding of child) and additional points that would negate Medicaid ineligibility (such as, the child voluntarily making payments back to the father before Medicaid was even an issue). The gentleman passed away before Medicaid was able to make its determination.
The key point of the above analysis is that a representative should never give up if there are valid arguments in favor of the applicant.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© June 2009, Post #43
Thursday, June 18, 2009
Assets Transferred to a Disabled Child
Assets Transferred to a Disabled Child
One of the areas often neglected in Medicaid is transferring funds to a disabled child. “Disabled” would be satisfied if the child were on S.S.I. or a social security disability.
Many “disabled” children can handle money depending the nature of the disability.
I had a matter in which a husband and a wife had a total of $750,000 and were both going into a nursing home. At the Medicaid meeting, I presented the plan to the County Board and the Board agreed that such a transfer would be exempt.
The nature of the child’s disability was psychological, but was not severe. Medicaid does not seem to inquire as to the disposition of funds by the disabled child. In this case, the disabled child (after both his parents got Medicaid) transferred the funds to his brother and the monies were protected and both parents immediately qualified for Medicaid.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© June 2009, Post #42
One of the areas often neglected in Medicaid is transferring funds to a disabled child. “Disabled” would be satisfied if the child were on S.S.I. or a social security disability.
Many “disabled” children can handle money depending the nature of the disability.
I had a matter in which a husband and a wife had a total of $750,000 and were both going into a nursing home. At the Medicaid meeting, I presented the plan to the County Board and the Board agreed that such a transfer would be exempt.
The nature of the child’s disability was psychological, but was not severe. Medicaid does not seem to inquire as to the disposition of funds by the disabled child. In this case, the disabled child (after both his parents got Medicaid) transferred the funds to his brother and the monies were protected and both parents immediately qualified for Medicaid.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© June 2009, Post #42
Friday, June 12, 2009
Practical Idea for Protecting the Home
Practical Idea for Protecting the Home
This article is another example of utilizing some of the theoretical rules discussed with respect to the home. This article addresses the two-year rule pursuant to which an applicant can transfer her home to a child and, if the child lives in the home for two years and provides care so that the mother need not go in a nursing home, the transfer would be exempt from the transfer rules (see Post 6).
The typical example would be Mrs. Jones owns a home and some other minor assets. Mrs. Jones is not ready to go into a nursing home but is declining to some extent.
Her daughter, Diane, is single and would like to take care of her mother.
Rather than the house be sold and the mother go into a nursing home, Diane would move in with Mrs. Jones and provide such care as to satisfy the two-year rule. Hopefully, Diane would be able to reside with her mother for two-years prior to application for Medicaid. In this way, the home would be saved and transferred to Diane, who happens to be the mother’s sole heir.
See Post 6, which discusses the two-year rule in more detail.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
June 2009, Post #41
This article is another example of utilizing some of the theoretical rules discussed with respect to the home. This article addresses the two-year rule pursuant to which an applicant can transfer her home to a child and, if the child lives in the home for two years and provides care so that the mother need not go in a nursing home, the transfer would be exempt from the transfer rules (see Post 6).
The typical example would be Mrs. Jones owns a home and some other minor assets. Mrs. Jones is not ready to go into a nursing home but is declining to some extent.
Her daughter, Diane, is single and would like to take care of her mother.
Rather than the house be sold and the mother go into a nursing home, Diane would move in with Mrs. Jones and provide such care as to satisfy the two-year rule. Hopefully, Diane would be able to reside with her mother for two-years prior to application for Medicaid. In this way, the home would be saved and transferred to Diane, who happens to be the mother’s sole heir.
See Post 6, which discusses the two-year rule in more detail.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
June 2009, Post #41
Monday, June 8, 2009
Caretaker Child - Practical Aspects
Caretaker Child – Practical Aspects
Prior posts have addressed mainly the rules and theoretical basis for various aspects of Medicaid planning. The next several articles will deal with practical applications of some of the aforementioned rules.
Suppose Mrs. Smith has a home, is competent, but is also a nursing home candidate. Susan, her daughter, has her own home and is willing to have Mrs. Smith move in and make improvements and/or expansions to her home to accommodate her mother.
The various posts (see Posts 6, 23)) that have been discussed are particularly applicable in this situation.
The plan would be for the daughter to make the necessary improvements and/or expansions on her home, Mrs. Smith would sell her home and move into Susan’s home. Prior to moving in there would be a caretaker agreement that would provide for the services and living arrangements to be provided by Susan in exchange for reimbursement by Mrs. Smith which would be set forth in a caretaker agreement.
Such an approach would not only save the value of the house of the family by way of payment to Susan, but would allow the mother to reside with her family and have care rather than live in a nursing home.
As indicated in Post 17, it is absolutely necessary that there be a third party valuation which sets forth the amount of payments to be made by Mrs. Smith. Such payments must be at the prevailing rate in the community. Any payments by Mrs. Smith in excess of that would be treated as a transfer.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© June 2009, Post #40
Prior posts have addressed mainly the rules and theoretical basis for various aspects of Medicaid planning. The next several articles will deal with practical applications of some of the aforementioned rules.
Suppose Mrs. Smith has a home, is competent, but is also a nursing home candidate. Susan, her daughter, has her own home and is willing to have Mrs. Smith move in and make improvements and/or expansions to her home to accommodate her mother.
The various posts (see Posts 6, 23)) that have been discussed are particularly applicable in this situation.
The plan would be for the daughter to make the necessary improvements and/or expansions on her home, Mrs. Smith would sell her home and move into Susan’s home. Prior to moving in there would be a caretaker agreement that would provide for the services and living arrangements to be provided by Susan in exchange for reimbursement by Mrs. Smith which would be set forth in a caretaker agreement.
Such an approach would not only save the value of the house of the family by way of payment to Susan, but would allow the mother to reside with her family and have care rather than live in a nursing home.
As indicated in Post 17, it is absolutely necessary that there be a third party valuation which sets forth the amount of payments to be made by Mrs. Smith. Such payments must be at the prevailing rate in the community. Any payments by Mrs. Smith in excess of that would be treated as a transfer.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© June 2009, Post #40
Tuesday, June 2, 2009
Medicaid Eligibility before a Favorable Determination
Medicaid Eligibility Before a Favorable Determination
Ideally, an application should be submitted several months before eligibility and updated each month until qualification. Under such a fact situation, the issuance of an eligibility letter is predictable. However, the statements may not reflect the amount actually in an account as a check written before the first of the month that has not cleared (see Post 4). Medicaid will issue an eligibility letter retroactive to the application date in such a case.
A more problematic situation is eligibility is met on the first of the month, but Medicaid does not process the application for several months. In such case, the date of eligibility is retroactive to the date that an individual is actually eligible rather than the date that Medicaid reviews the papers and has been dilatory in coming to this conclusion.
Once an applicant has been advised by counsel that he or she is eligible for Medicaid, no further payments are to be made to the nursing home regardless of whether the actual eligibility letter has been issued.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© June 2009, Post #39
Ideally, an application should be submitted several months before eligibility and updated each month until qualification. Under such a fact situation, the issuance of an eligibility letter is predictable. However, the statements may not reflect the amount actually in an account as a check written before the first of the month that has not cleared (see Post 4). Medicaid will issue an eligibility letter retroactive to the application date in such a case.
A more problematic situation is eligibility is met on the first of the month, but Medicaid does not process the application for several months. In such case, the date of eligibility is retroactive to the date that an individual is actually eligible rather than the date that Medicaid reviews the papers and has been dilatory in coming to this conclusion.
Once an applicant has been advised by counsel that he or she is eligible for Medicaid, no further payments are to be made to the nursing home regardless of whether the actual eligibility letter has been issued.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© June 2009, Post #39
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