Allocation of Transfer Penalty – When Community Spouse Makes
Transfer and Then Enters Nursing Home
Transfers by the spouse of an applicant are considered in determining the Medicaid eligibility of such individual. Under prior law, such transfers would also be considered again in determining eligibility for a community spouse who subsequently was institutionalized. That is, transfers by a community spouse who was subsequently institutionalized resulted in a double penalty. OBRA ’93 (which hasn’t been changed by the current law) requires that a “reasonable methodology” be employed to apportion the period of ineligibility between the applicant and a transferor – spouse who is subsequently institutionalized.
Example: Individual is in nursing home. Transfer of assets by spouse results in a 20-month penalty period for individual. Eight months after the transfer, spouse is institutionalized. The remaining penalty period of 12 months is to be apportioned. Presumably, six months will be allocated to each so that individual’s period of ineligibility due to the transfer will total 14 months.
Keep in mind, that under current law the penalty commences as outlined in Post #15.
Note: If one spouse dies or leaves the institution, the remaining portion of the penalty is allocated to the other spouse.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© April 2009, Post #19
Showing posts with label Elder Law. Show all posts
Showing posts with label Elder Law. Show all posts
Wednesday, April 1, 2009
Friday, March 27, 2009
Payment by Applicant for Care or Services Provided by Child
Payment by Applicant for Care or Services Provided by Child
A common occurrence is for a child to provide services in the past for someone who is now an applicant for Medicaid. The State takes the position that at the time the services by the child were delivered that they shall be presumed to have been intended to be delivered without compensation. Therefore, funds transferred by the applicant within the look-back rule to compensate a friend or relative shall be presumed to have been Medicaid penalizing transfers. This presumption may be rebutted by documentary evidence which was in existence at the time of the delivery of care or services by the child.
Generally, “documentary evidence” refers to a writing in the nature of a caretaker agreement by which the child would provide the necessary services (parent lived in home with child), which is intended to be reimbursed by the parent and avoid penalty implications.
Such caretaker agreement should include the following:
1. The specific nature of services provided by the child (delineated in an attached schedule to this agreement).
2. An independent valuation of such services possibly by a geriatric care manager if such services include care for the parent, tending to medical needs and related matters. I believe the independent valuation is absolutely necessary to maintain the validity of the agreement. Many attorneys draft caretaker agreements which include the attorney’s estimate of such value. In this regard, the State takes the position that “the amount of compensation or the fair market value of asset transferred [by the applicant] shall not be greater than the prevailing rates for similar care or services in the community. That portion of compensation in excess of the prevailing rate shall be considered to be uncompensated value.” Any portion in excess of such rates shall be deemed a transfer for eligibility purposes.
An improperly drafted agreement can raise very serious problems, particularly under the new transfer rules.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© March 2009, Post #17
A common occurrence is for a child to provide services in the past for someone who is now an applicant for Medicaid. The State takes the position that at the time the services by the child were delivered that they shall be presumed to have been intended to be delivered without compensation. Therefore, funds transferred by the applicant within the look-back rule to compensate a friend or relative shall be presumed to have been Medicaid penalizing transfers. This presumption may be rebutted by documentary evidence which was in existence at the time of the delivery of care or services by the child.
Generally, “documentary evidence” refers to a writing in the nature of a caretaker agreement by which the child would provide the necessary services (parent lived in home with child), which is intended to be reimbursed by the parent and avoid penalty implications.
Such caretaker agreement should include the following:
1. The specific nature of services provided by the child (delineated in an attached schedule to this agreement).
2. An independent valuation of such services possibly by a geriatric care manager if such services include care for the parent, tending to medical needs and related matters. I believe the independent valuation is absolutely necessary to maintain the validity of the agreement. Many attorneys draft caretaker agreements which include the attorney’s estimate of such value. In this regard, the State takes the position that “the amount of compensation or the fair market value of asset transferred [by the applicant] shall not be greater than the prevailing rates for similar care or services in the community. That portion of compensation in excess of the prevailing rate shall be considered to be uncompensated value.” Any portion in excess of such rates shall be deemed a transfer for eligibility purposes.
An improperly drafted agreement can raise very serious problems, particularly under the new transfer rules.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© March 2009, Post #17
Wednesday, March 25, 2009
Qualifying for Medicaid
Qualifying for Medicaid
Ideally, representation for Medicaid eligibility should commence at least six months prior to the anticipated date of eligibility. Proper planning should result in the protection of resources, and, in many cases acceleration of the date of eligibility.
I. The General Problem
Counsel is engaged to represent an individual who recently entered a nursing home. Resources may include bank accounts, securities, E bonds, IRAs, life insurance policies and/or a residence. Individual may have current debts, such as doctor bills and credit card charges, and anticipates future debts, such as nursing home costs and income tax liabilities.
Topics which have been previously covered include the following:
1. Life insurance (Post #3)
2. Residence (Post ##6, 11 and 14)
3. Payment of Debts (Post #4)
4. Acceleration of Date of Eligibility (Post #5)
II. Priority of Payments
A. Debts, nursing home costs, the acquisition of excludable resources (such as burial arrangements) and income tax liabilities are the major expenditures incurred during the spend-down period. Debts should be paid immediately and expenditures paid as incurred with an eye toward the goal of meeting the resource requirement on the first day of the projected month. As indicated above, failure to meet the resource requirement by even a minimal amount requires that payment be made at the private rate until the resource requirement is met.
B. Projecting the date of eligibility is not an exact science as circumstances may require a revised eligibility date. On the expense side of the ledger are costs such as increased nursing home charges for a given month and unreimbursed medical bills. On the asset side of the ledger are receipts such as medical reimbursements and income tax refunds.
C. Maintaining an element of flexibility in making payments is the key to establishing a projected date of eligibility.
Example: Applicant is seeking July 1, 2009 eligibility. The resource requirement is $2,000. There is no deposit at the nursing home. All debts and expenses (including prepaid funeral arrangement of $5,000) have been paid. On June 25, applicant has $4,000 in resources. If funds not reduced to $2,000 on July 1, eligibility will be denied.
Contrast: Facts same as above except funeral costs have not been paid. Resources are, therefore, $4,000 (original June 25 balance) plus $5,000 (monies set aside for funeral, but not paid), or $9,000. Funeral arrangements should be made so that the cost is at least $7,000.
Rule: Prepaid funeral arrangements should be one of the last expenditures prior to the anticipated date of eligibility. The inherent flexibility in the amount of this payment allows for the resource requirement to be met.
D. One of the first liabilities to be determined and paid is state and federal income taxes. As indicated herein, failure to address this issue could result in delaying the date of eligibility, or even worse, could result in a liability when no monies are available or in payment from community spouse’s protected funds.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© March 2009, Post #16
Ideally, representation for Medicaid eligibility should commence at least six months prior to the anticipated date of eligibility. Proper planning should result in the protection of resources, and, in many cases acceleration of the date of eligibility.
I. The General Problem
Counsel is engaged to represent an individual who recently entered a nursing home. Resources may include bank accounts, securities, E bonds, IRAs, life insurance policies and/or a residence. Individual may have current debts, such as doctor bills and credit card charges, and anticipates future debts, such as nursing home costs and income tax liabilities.
Topics which have been previously covered include the following:
1. Life insurance (Post #3)
2. Residence (Post ##6, 11 and 14)
3. Payment of Debts (Post #4)
4. Acceleration of Date of Eligibility (Post #5)
II. Priority of Payments
A. Debts, nursing home costs, the acquisition of excludable resources (such as burial arrangements) and income tax liabilities are the major expenditures incurred during the spend-down period. Debts should be paid immediately and expenditures paid as incurred with an eye toward the goal of meeting the resource requirement on the first day of the projected month. As indicated above, failure to meet the resource requirement by even a minimal amount requires that payment be made at the private rate until the resource requirement is met.
B. Projecting the date of eligibility is not an exact science as circumstances may require a revised eligibility date. On the expense side of the ledger are costs such as increased nursing home charges for a given month and unreimbursed medical bills. On the asset side of the ledger are receipts such as medical reimbursements and income tax refunds.
C. Maintaining an element of flexibility in making payments is the key to establishing a projected date of eligibility.
Example: Applicant is seeking July 1, 2009 eligibility. The resource requirement is $2,000. There is no deposit at the nursing home. All debts and expenses (including prepaid funeral arrangement of $5,000) have been paid. On June 25, applicant has $4,000 in resources. If funds not reduced to $2,000 on July 1, eligibility will be denied.
Contrast: Facts same as above except funeral costs have not been paid. Resources are, therefore, $4,000 (original June 25 balance) plus $5,000 (monies set aside for funeral, but not paid), or $9,000. Funeral arrangements should be made so that the cost is at least $7,000.
Rule: Prepaid funeral arrangements should be one of the last expenditures prior to the anticipated date of eligibility. The inherent flexibility in the amount of this payment allows for the resource requirement to be met.
D. One of the first liabilities to be determined and paid is state and federal income taxes. As indicated herein, failure to address this issue could result in delaying the date of eligibility, or even worse, could result in a liability when no monies are available or in payment from community spouse’s protected funds.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© March 2009, Post #16
Tuesday, March 10, 2009
Significance of the 90-Day Rule
Significance of the 90-Day Rule
Pursuant to N.J.A.C. 10:71-4.8(a)2., an applicant will be eligible for Medicaid when couple’s total resources reduced by community spouse’s share, are equal or less than $2,000 subject to exclusions. Also see N.J.A.C. 10:71-4.8(a)3., which requires that ownership of the community spouse’s share be transferred to the community spouse within 90 days of Medicaid eligibility. Therefore, eligibility will be determined on the basis of total resources of applicant and spouse (i.e. joint accounts), but if applicant has more than $2,000 at the time of eligibility, the County Board will check ownership 90 days after eligibility.
Example: Total resources of institutionalized individual and spouse at date of institutionalization are $300,000. The community spouse resource allowance is $109,560.
Assuming all other requirements are met, institutionalized individual will be eligible for Medicaid when total resources are equal to or less than $111,560.
Therefore, if total resources at the time of application considering those of the applicant and those of the community spouse are equal or less than the appropriate amounts, Medicaid eligibility will be granted. However, within 90 days the Community Spouse Resource Allowance must be in the name of the community spouse and the applicant cannot have more than his or her resource allowance.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© March 2009, Post #10
Pursuant to N.J.A.C. 10:71-4.8(a)2., an applicant will be eligible for Medicaid when couple’s total resources reduced by community spouse’s share, are equal or less than $2,000 subject to exclusions. Also see N.J.A.C. 10:71-4.8(a)3., which requires that ownership of the community spouse’s share be transferred to the community spouse within 90 days of Medicaid eligibility. Therefore, eligibility will be determined on the basis of total resources of applicant and spouse (i.e. joint accounts), but if applicant has more than $2,000 at the time of eligibility, the County Board will check ownership 90 days after eligibility.
Example: Total resources of institutionalized individual and spouse at date of institutionalization are $300,000. The community spouse resource allowance is $109,560.
Assuming all other requirements are met, institutionalized individual will be eligible for Medicaid when total resources are equal to or less than $111,560.
Therefore, if total resources at the time of application considering those of the applicant and those of the community spouse are equal or less than the appropriate amounts, Medicaid eligibility will be granted. However, within 90 days the Community Spouse Resource Allowance must be in the name of the community spouse and the applicant cannot have more than his or her resource allowance.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© March 2009, Post #10
Monday, March 9, 2009
Theory for Using Date of Institutionalization for Computation of Protected Amount
Theory for Using Date of Institutionalization for Computation of Protected Amount
Community spouse requires certainty after institutionalization in order to protect the Community Spouse Resource Allowance. If such a determination were not made as of the date of institutionalization, at any point in time the community spouse would not be aware of the amount of resources that could be protected and may have expended more funds than necessary. Therefore, the computation of the allowance is made prospectively.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© March 2009, Post #9
Community spouse requires certainty after institutionalization in order to protect the Community Spouse Resource Allowance. If such a determination were not made as of the date of institutionalization, at any point in time the community spouse would not be aware of the amount of resources that could be protected and may have expended more funds than necessary. Therefore, the computation of the allowance is made prospectively.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© March 2009, Post #9
Tuesday, March 3, 2009
Rules for Medicaid Planning
Rules for Medicaid Eligibility
The goal in standard Medicaid planning is for the single individual or the single applicant to have assets reduced to the appropriate number. Similarly, the funds of a married community spouse are to be considered when the applicant is married.
The rules and examples are set forth below:
A. Single individual: $2,000, $4,000 if monthly income is greater than $2,022.
B. Married individual: Asset limitation on community spouse (one-half total resources as of date of institutionalization). 2009 maximum: $109,560, minimum: $21,912.
Example 1: Total Resources: $100,000
Community Spouse Resource Allowance: $ 50,000
Example 2: Total Resources: $300,000
Community Spouse Resource Allowance: $109,560
Example 3: Total Resources: $ 30,000
Community Spouse Resource Allowance: $ 21,912
Subsequent articles will discuss other aspects of the Community Spouse Resource Allowance.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© March 2009, Post #7
The goal in standard Medicaid planning is for the single individual or the single applicant to have assets reduced to the appropriate number. Similarly, the funds of a married community spouse are to be considered when the applicant is married.
The rules and examples are set forth below:
A. Single individual: $2,000, $4,000 if monthly income is greater than $2,022.
B. Married individual: Asset limitation on community spouse (one-half total resources as of date of institutionalization). 2009 maximum: $109,560, minimum: $21,912.
Example 1: Total Resources: $100,000
Community Spouse Resource Allowance: $ 50,000
Example 2: Total Resources: $300,000
Community Spouse Resource Allowance: $109,560
Example 3: Total Resources: $ 30,000
Community Spouse Resource Allowance: $ 21,912
Subsequent articles will discuss other aspects of the Community Spouse Resource Allowance.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© March 2009, Post #7
Monday, March 2, 2009
Property Owned by Applicant Residing with Caretaker Child
Property Owned by Applicant Residing with Caretaker Child
The transfer rules do not apply to the transfer of the home to designated individuals. The materials refer to such individuals as “protected transferees.” For the purposes of the following discussion, the “protected transferee” is assumed to be a child of the individual who provided care to the individual at home.
A. The child must have (i) resided in the home for at least two years prior to institutionalization; and (ii) provided care which permitted individual to reside at home rather than go into a nursing home.
Note: The statute is silent as to the permissible time of transfer.
B. The subjective determination of whether a child has provided the requisite care is made by the County Board upon application for Medicaid. An unfavorable determination by the Board results in a denial of eligibility and a substantial period of ineligibility.
Planning Point: The request for protected transferee status should be made in conjunction with the application for Medicaid. This approach avoids the risk of a period of ineligibility. If the applicant is incompetent, seek court approval for the transfer in a guardianship proceeding and incorporate the written approval by the County Board in your papers.
Planning Point Before Medicaid Application Process: Counsel will often be presented with situation in which a child is residing with applicant in applicant’s residence and applicant-client desires Medicaid planning and does not desire to transfer the home (or counsel is of the opinion that home should be transferred as part of the Medicaid application process). Counsel should incorporate language in potential applicant’s power of attorney that allows residence to be transferred to child if appropriate for Medicaid planning purposes.
C. If protected transferee is one of several children who are equal beneficiaries under the applicant’s will, arrangements should be made by the children to avoid litigation. However, the transfer should be made solely to the child with protected status. Written approval to the transfer from the other children should be obtained if transfer is being made pursuant to a guardianship proceeding.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© February 2009, Post #6
The transfer rules do not apply to the transfer of the home to designated individuals. The materials refer to such individuals as “protected transferees.” For the purposes of the following discussion, the “protected transferee” is assumed to be a child of the individual who provided care to the individual at home.
A. The child must have (i) resided in the home for at least two years prior to institutionalization; and (ii) provided care which permitted individual to reside at home rather than go into a nursing home.
Note: The statute is silent as to the permissible time of transfer.
B. The subjective determination of whether a child has provided the requisite care is made by the County Board upon application for Medicaid. An unfavorable determination by the Board results in a denial of eligibility and a substantial period of ineligibility.
Planning Point: The request for protected transferee status should be made in conjunction with the application for Medicaid. This approach avoids the risk of a period of ineligibility. If the applicant is incompetent, seek court approval for the transfer in a guardianship proceeding and incorporate the written approval by the County Board in your papers.
Planning Point Before Medicaid Application Process: Counsel will often be presented with situation in which a child is residing with applicant in applicant’s residence and applicant-client desires Medicaid planning and does not desire to transfer the home (or counsel is of the opinion that home should be transferred as part of the Medicaid application process). Counsel should incorporate language in potential applicant’s power of attorney that allows residence to be transferred to child if appropriate for Medicaid planning purposes.
C. If protected transferee is one of several children who are equal beneficiaries under the applicant’s will, arrangements should be made by the children to avoid litigation. However, the transfer should be made solely to the child with protected status. Written approval to the transfer from the other children should be obtained if transfer is being made pursuant to a guardianship proceeding.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© February 2009, Post #6
Tuesday, February 24, 2009
Accelerating the Date of Eligibility
Accelerating the Date of Eligibility
1. While timely payment of debts is an important step in establishing the date of eligibility, it is often possible to accelerate such date by the prepayment of a future debt or by acquiring excludable resources.
2. Frequently in the planning process an income tax liability is generated due to the liquidation of assets. Typical examples are the redemption of E or EE bonds, sales of securities and the withdrawal of funds from an IRA. Payment of income taxes on these transactions on April 15 could delay the date of eligibility. Counsel should confer with applicant’s accountant to discuss maximum payment of estimated taxes.
3. If applicant is married and community spouse is residing in the marital home, monies can be utilized for mortgage payments or for home repairs.
4. Monies can be used to purchase excludable resources such as an irrevocable burial arrangement – N.J.A.C. 10:71-4.4(b)9.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© February 2009, Post #5
1. While timely payment of debts is an important step in establishing the date of eligibility, it is often possible to accelerate such date by the prepayment of a future debt or by acquiring excludable resources.
2. Frequently in the planning process an income tax liability is generated due to the liquidation of assets. Typical examples are the redemption of E or EE bonds, sales of securities and the withdrawal of funds from an IRA. Payment of income taxes on these transactions on April 15 could delay the date of eligibility. Counsel should confer with applicant’s accountant to discuss maximum payment of estimated taxes.
3. If applicant is married and community spouse is residing in the marital home, monies can be utilized for mortgage payments or for home repairs.
4. Monies can be used to purchase excludable resources such as an irrevocable burial arrangement – N.J.A.C. 10:71-4.4(b)9.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© February 2009, Post #5
Tuesday, February 17, 2009
Life Insurance Issues
Life Insurance Issues
A. One of the most common oversights which can delay eligibility is the failure to inquire about applicant’s (or spouse’s) life insurance policies. References to the relevant New Jersey Administrative Code citations are included.
B. While the cash value of life insurance policies with a total face value of $1,500 or less is an excludable resource (N.J.A.C. 10:71-4. 4(b)4.), the existence of a life insurance policy(s) often presents a trap for the unwary. Often an elderly client will have a small policy with a substantial cash value. If the face value of such policy (or total face value of several policies) exceeds $1,500, the cash value constitutes a countable resource. Therefore, it is necessary to surrender the policy and spend the cash value.
Caution: While a group policy has no cash value, the aggregate face amount of all policies (including group) is considered in the determination of whether the cash value(s) is an excludable resource.
Note: Another solution to the cash value problem is for the owner of the policy (generally the applicant) to borrow against the policy. While this technique would reduce the death proceeds, the cash value would no longer be a resource. Hopefully, the borrowed funds can be used to pay debts or acquire excludable resources.
1. If the face amount of a policy is large and/or the death of an applicant is near, consideration should be given to a transfer of ownership of the policy to the community spouse. Of course, the cash value will then count toward the Community Spouse Resource Allowance.
2. Life insurance on the life of and owned by the community spouse could also present a problem. That is, the cash value on such policy counts toward the Community Spouse Resource Allowance and will result in a denial of eligibility if not considered. There is no express $1,500 exclusion in the regulations for a policy owned by and on the life of the community spouse.
Note: Again, policies need not always be surrendered. As indicated above, it might be advantageous to transfer a policy with a substantial death benefit to the community spouse, particularly if death of the applicant is near.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© February 2009, Post #3
Friday, February 13, 2009
Additional Post-Eligibility Considerations
Additional Post-Eligibility Considerations
Accounts Closed Out During the Look-back Period
In addition to providing history for all accounts during the relevant look-back period, documentation should be provided for any accounts terminated during such time. Also, tracing the proceeds of such accounts is necessary. Firstly, this process will allow you to detect unknown transfers. Secondly, such information is to be provided since the County Board does a crosscheck with the IRS of Forms 1099 of a Medicaid recipient prior to eligibility. Such crosschecks will reveal all interest bearing accounts held by a Medicaid recipient (and other assets such as stocks) during this time period. If such search reveals an account(s) not disclosed in the Medicaid application papers, the County will make a post-eligibility inquiry. By providing such documentation at the time of application, the family avoids the nuisance of subsequent inquiry by Medicaid with respect to accounts closed out and not mentioned.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© February 2009, Post #2
Accounts Closed Out During the Look-back Period
In addition to providing history for all accounts during the relevant look-back period, documentation should be provided for any accounts terminated during such time. Also, tracing the proceeds of such accounts is necessary. Firstly, this process will allow you to detect unknown transfers. Secondly, such information is to be provided since the County Board does a crosscheck with the IRS of Forms 1099 of a Medicaid recipient prior to eligibility. Such crosschecks will reveal all interest bearing accounts held by a Medicaid recipient (and other assets such as stocks) during this time period. If such search reveals an account(s) not disclosed in the Medicaid application papers, the County will make a post-eligibility inquiry. By providing such documentation at the time of application, the family avoids the nuisance of subsequent inquiry by Medicaid with respect to accounts closed out and not mentioned.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© February 2009, Post #2
Wednesday, February 11, 2009
Methods of Payment of Medigap Insurance After Eligibility
Appointment of Representative Payee
1. 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.
2. Such payments received during any given month constitute resources on the “first moment of the first day” of the subsequent month.
3. 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.
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.
Alternative Arrangements: If a recipient maintains Medigap insurance, Medicaid will subsidize such costs. In such case, it might be prudent not to designate the nursing home as representative payee since the recipient would have to rely on the nursing home to pay the Medigap premiums from the assigned monies. If Medigap insurance is to be maintained, the following possibilities exist:
(a) Designate nursing home as representative payee and arrange for home to pay Medigap premiums (risky).
(b) Continue Social Security payments to applicant’s account. Applicant (or attorney-in-fact) pays premiums directly and remits any excess funds to the nursing home.
(c) If pension payments can cover the Medigap premiums, designate nursing home as representative payee of Social Security, pay premiums from pension funds, remit any excess pension monies to nursing home.
4. Payments from qualified retirement plans cannot be assigned. Therefore, in the event of such payments, recipient should maintain a checking account for deposit of such funds. These monies are to be paid to the nursing home monthly.
5. At the point of eligibility or within ninety days of eligibility (the “90-Day Rule”), all joint accounts with community spouse should be terminated. The entire balance in a joint account will be treated as a resource of applicant. There should be a separate account for applicant. Also, a separate account in the name of community spouse should be the receptacle for pension and social security payments of community spouse and other monies.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© February 11, 2009, Issue 1
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