Post #7 sets forth the requirements for Medicaid eligibility in terms of the resources an individual and/or a community spouse must have in order for an applicant to have eligibility. Resources refers to funds available to pay nursing home costs.
The transfer rules are determined with respect to "assets." The word "assets" refers to both resources and income. That is, 42 U.S.C. 1396p(c) refers to a disposition of assets giving rise to a penalty. That is a transfer of both resources and income triggers the penalty rules.
Pension and social security monies are income in the first month received, but if not utilized to pay the nursing home or other debts before the first day of the first month following receipt, constitute resources.
Therefore, it is important to note the distinction between assets and resources as the word "assets" constitutes both resources and income. The eligibility rules are defined in terms of resources, while the transfer rules are defined in terms of assets.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© April 2011, Post 142
Monday, April 11, 2011
Wednesday, April 6, 2011
Negative Aspects of Inaccessible Resources
In Post 48, inaccessible resources are treated as excludable for Medicaid resource purposes. For example, a tenancy-in-common held by a Medicaid applicant with her sister is an inaccessible resource if the sister refuses to consent to a sale.
Notwithstanding, the definition of the Medicaid reimbursement rate is the outlay of Medicaid reduced by any continuing flow of income that the Medicaid recipient receives. If the tenancy-in-common were rented, one half the "net" rent would have to be used to defray the cost of Medicaid. Moreover, the property would be subject to the Medicaid lien upon the death of the Medicaid recipient.
Therefore, an excludable resource while being an advantage for Medicaid eligibility purposes, does have negative characteristics.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© April 2011, Post 141
Notwithstanding, the definition of the Medicaid reimbursement rate is the outlay of Medicaid reduced by any continuing flow of income that the Medicaid recipient receives. If the tenancy-in-common were rented, one half the "net" rent would have to be used to defray the cost of Medicaid. Moreover, the property would be subject to the Medicaid lien upon the death of the Medicaid recipient.
Therefore, an excludable resource while being an advantage for Medicaid eligibility purposes, does have negative characteristics.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© April 2011, Post 141
Wednesday, March 30, 2011
State Violates Federal Pre-emption by Limiting Post Eligibility Treatment of Income for Pre-Eligibility Medical Expenses (PEME) for Three Months
This relates to amounts that may be due to a nursing home if an individual is dilatory in applying for Medicaid.
Clearly, as indicated by the HCFA-PM-85-3 statement, this has been the federal law since 1985. However, Med. Com. No. 10-07 indicates its applicability to state law effective January 1, 2010. Previously, state law had been less restrictive and it allowed PEME to be paid back without the three month limitation. Therefore, since the state's position was less restrictive than the federal law, there was no violation of federal pre-emption.
The state, by limiting eligibility to pay such cost for three months retroactively, violates federal pre-emption in that the state was less restrictive in allowing payments in full. Therefore, its change in position in denying PEME to all applicants even before the date of Med. Com. No. 10-07 violates federal pre-emption, and is incorrect.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© March 2011, Post 140
Clearly, as indicated by the HCFA-PM-85-3 statement, this has been the federal law since 1985. However, Med. Com. No. 10-07 indicates its applicability to state law effective January 1, 2010. Previously, state law had been less restrictive and it allowed PEME to be paid back without the three month limitation. Therefore, since the state's position was less restrictive than the federal law, there was no violation of federal pre-emption.
The state, by limiting eligibility to pay such cost for three months retroactively, violates federal pre-emption in that the state was less restrictive in allowing payments in full. Therefore, its change in position in denying PEME to all applicants even before the date of Med. Com. No. 10-07 violates federal pre-emption, and is incorrect.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© March 2011, Post 140
Monday, March 21, 2011
The Nature of Joint Bank Accounts
Pursuant to N.J.S.A. 46:2B-11, every account with two names is deemed to be a "joint" bank account under New Jersey law. That is, it is irrelevant as to whether the language is "or", "and" or just has joint names. The account is deemed to be owned by each person in its entirety.
Therefore, as pointed out in many of my blogs, it is dangerous to maintain a joint account in the names of the applicant or others, since the presumption will be that all the funds in the account are owned by the applicant. This presumption can be rebutted by specific proof that the co-holder contributed to the account. In such case, a withdrawal of the co-holder's funds would not be a transfer.
Post 1 points out that it is recommended that joint accounts between applicant and spouse be terminated within 90 days pursuant to the 90-day rule.
The nature of joint accounts is governed by state law and maintaining a joint account between the applicant and another could endanger Medicaid eligibility. In Post 21, I pointed out that if the co-holder predeceases the applicant, the monies would be presumed to pass to the applicant by operation of law, which raises another problem.
The recommendation is that joint accounts between the applicant and another, particularly the spouse, be terminated.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© March 2011, Post 139
Therefore, as pointed out in many of my blogs, it is dangerous to maintain a joint account in the names of the applicant or others, since the presumption will be that all the funds in the account are owned by the applicant. This presumption can be rebutted by specific proof that the co-holder contributed to the account. In such case, a withdrawal of the co-holder's funds would not be a transfer.
Post 1 points out that it is recommended that joint accounts between applicant and spouse be terminated within 90 days pursuant to the 90-day rule.
The nature of joint accounts is governed by state law and maintaining a joint account between the applicant and another could endanger Medicaid eligibility. In Post 21, I pointed out that if the co-holder predeceases the applicant, the monies would be presumed to pass to the applicant by operation of law, which raises another problem.
The recommendation is that joint accounts between the applicant and another, particularly the spouse, be terminated.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© March 2011, Post 139
Tuesday, March 15, 2011
Inaccessible Resources Revisited
In Post 48, I discussed the relevance of inaccessible resources as being excludable for Medicaid eligibility purposes. The theory is that a countable resource is only such that can be converted to monies to pay nursing home costs.
Examples presented were joint real estate if the co-owner refuses to liquidate, property in probate, real estate which may not comport with zoning requirements and unpaid funds such as future salary.
However, this is an area that allows for creativity. For example, as discussed in my Webinar with Carol Johnston on Ethical Dilemmas for Elder Law Practitioners, I raised the possibility that stock of a closely held corporation might be deemed an inaccessible resource if subject to a buy-sell agreement. Also, monies that are not currently payable such as royalties, constitute inaccessible resources as they are not immediately available. The definition of inaccessible resource is not exclusive, but provides examples. Therefore, creativity is required in this area.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© March 2011, Post 138
Examples presented were joint real estate if the co-owner refuses to liquidate, property in probate, real estate which may not comport with zoning requirements and unpaid funds such as future salary.
However, this is an area that allows for creativity. For example, as discussed in my Webinar with Carol Johnston on Ethical Dilemmas for Elder Law Practitioners, I raised the possibility that stock of a closely held corporation might be deemed an inaccessible resource if subject to a buy-sell agreement. Also, monies that are not currently payable such as royalties, constitute inaccessible resources as they are not immediately available. The definition of inaccessible resource is not exclusive, but provides examples. Therefore, creativity is required in this area.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© March 2011, Post 138
Tuesday, March 8, 2011
The Role of the Constitution in Elder Law
The theme throughout many of my blogs has been the concept of federal pre-emption. That is, the federal law supersedes state law except if state law is less restrictive. For example, Post 113 indicates that under the concept of federal pre-emption, reverse half-a-loaf planning should be acceptable. That is, although the state and federal law appear to conflict, state law is less restrictive and should allow such planning.
Similarly, the state is misguided in its position that the disinheritance of an individual in a nursing home results in a transfer. Section 42 U.S.C. 1396(p)(e) requires an affirmative act for a transfer and the state's law is more restrictive in that the state is imposing a penalty for a transfer on the failure to exercise the elective share, which is not an affirmative act, but rather an option.
There are numerous examples of such violation. One more which is rather important is the refusal of the state to honor spousal refusal. As pointed out in Post 78, spousal refusal and the right of the community spouse to contribute is to be allowed if the state has the right to pursue the community spouse. This is clearly the case in New Jersey as the state can stand in the shoes of the applicant and sue the community spouse for any non-payment. Notwithstanding, New Jersey does not follow this approach.
The concept of federal pre-emption and the extent to which a state follows a law varies from jurisdiction to jurisdiction. Therefore, not only is knowledge of the federal statute absolutely necessary, but the interpretation by the state is even more significant.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© March 2011, Post 137
Similarly, the state is misguided in its position that the disinheritance of an individual in a nursing home results in a transfer. Section 42 U.S.C. 1396(p)(e) requires an affirmative act for a transfer and the state's law is more restrictive in that the state is imposing a penalty for a transfer on the failure to exercise the elective share, which is not an affirmative act, but rather an option.
There are numerous examples of such violation. One more which is rather important is the refusal of the state to honor spousal refusal. As pointed out in Post 78, spousal refusal and the right of the community spouse to contribute is to be allowed if the state has the right to pursue the community spouse. This is clearly the case in New Jersey as the state can stand in the shoes of the applicant and sue the community spouse for any non-payment. Notwithstanding, New Jersey does not follow this approach.
The concept of federal pre-emption and the extent to which a state follows a law varies from jurisdiction to jurisdiction. Therefore, not only is knowledge of the federal statute absolutely necessary, but the interpretation by the state is even more significant.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© March 2011, Post 137
Monday, February 28, 2011
Givebacks When Transfers Have Been Made to More Than One Person
The concept of givebacks has been previously discussed (see post 99). Basically under the new law and prior law, givebacks undo a penalty pro-rata. As indicated in such post, givebacks are particularly significant in the current law since they undo the onerous penalty provisions.
The issue arises if transfers have been made to two people and the Medicaid authorities refuse to allow the transfers to be considered “exclusively for another purpose” (see post 43). The question arises if transfers are made to two individuals and Medicaid has determined that the transfers were for a purpose other than to qualify for Medicaid. The State takes a hard line on allowing the exclusion. Therefore, to negate the penalty, the monies must be given back. However, assume that one of the donees does not have sufficient funds. The question becomes can the other donee repay so that the problem of the dual transfers is deemed cured. Several Medicaid supervisors have indicated that the wealthier donee (who has funds) can reverse the transfer penalty for both donees by returning all of the funds himself. This is a viable solution to a difficult problem.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© February 2011, Post 107
The issue arises if transfers have been made to two people and the Medicaid authorities refuse to allow the transfers to be considered “exclusively for another purpose” (see post 43). The question arises if transfers are made to two individuals and Medicaid has determined that the transfers were for a purpose other than to qualify for Medicaid. The State takes a hard line on allowing the exclusion. Therefore, to negate the penalty, the monies must be given back. However, assume that one of the donees does not have sufficient funds. The question becomes can the other donee repay so that the problem of the dual transfers is deemed cured. Several Medicaid supervisors have indicated that the wealthier donee (who has funds) can reverse the transfer penalty for both donees by returning all of the funds himself. This is a viable solution to a difficult problem.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© February 2011, Post 107
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