In Post 11, the advantages of purchasing a home by the community spouse were discussed.
Suppose there are community assets of $400,000.00 and the community spouse is renting a home. The community spouse resource allowance maximum is $109,560.00. The community spouse can protect additional assets by purchasing a home which would be an excludable resource. As indicated by Post 11, the resources of the community spouse are no longer relevant after the applicant receives Medicaid.
Therefore, a viable planning technique would be for the community spouse to temporarily purchase a residence, which could be sold or gifted after the applicant gets Medicaid.
Further, as discussed in Post 33, if the community spouse is working, the community spouse should cease working until after the applicant receives Medicaid.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© May 2011, Post 146
Wednesday, May 25, 2011
Wednesday, May 18, 2011
Negative Results of Disclaimer by Nursing Home Resident
Although a disclaimer may have estate planning benefits, such an action would be treated as a transfer under the Medicaid rules (see Federal Statute 42 U.S.C. Section 1396p(c) and (e)). The first Statute treats a transfer as any disposition and the second statute requires an affirmative act.
Since a disclaimer is an affirmative act, the period of ineligibility from the disclaimer would run not from the date of the disclaimer but from the date the individual was in the nursing home and down to the appropriate amount ($2,000 or $4,000).
Pursuant to Medicaid Communication 10-02 and 10-06 , reverse half-a-loaf planning will not work in New Jersey. Therefore, the only choice is not to disclaim and to spend the monies on the nursing home. The appropriate planning would be to transfer monies to the appropriate donees who would then use the monies for the benefit of the nursing home resident. Should any monies remain after the 5 year look back period, such funds would be saved for the donees.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© May 2011, Post 145
Since a disclaimer is an affirmative act, the period of ineligibility from the disclaimer would run not from the date of the disclaimer but from the date the individual was in the nursing home and down to the appropriate amount ($2,000 or $4,000).
Pursuant to Medicaid Communication 10-02 and 10-06 , reverse half-a-loaf planning will not work in New Jersey. Therefore, the only choice is not to disclaim and to spend the monies on the nursing home. The appropriate planning would be to transfer monies to the appropriate donees who would then use the monies for the benefit of the nursing home resident. Should any monies remain after the 5 year look back period, such funds would be saved for the donees.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© May 2011, Post 145
Monday, May 9, 2011
TIAA-CREF and its Effect on Medicaid
Many Medicaid applicants are recipients of a retirement plan known as TIAA-CREF. This is the retirement benefit paid to those working within the college environment.
There are two basic types of retirement benefits. One provides for an irrevocable election of payment of an annuity. The other type of benefit may be in the form of an annuity, but the remaining balance constitutes an available resource.
Therefore, it is incumbent upon counsel to carefully review the available plan. Should the benefit remain an available resource, this has a negative effect on Medicaid eligibility. However, if the benefit is an irrevocable election, the funds must be used to help defray the cost of Medicaid in the manner of a pension or social security.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© May 2011, Post 144
There are two basic types of retirement benefits. One provides for an irrevocable election of payment of an annuity. The other type of benefit may be in the form of an annuity, but the remaining balance constitutes an available resource.
Therefore, it is incumbent upon counsel to carefully review the available plan. Should the benefit remain an available resource, this has a negative effect on Medicaid eligibility. However, if the benefit is an irrevocable election, the funds must be used to help defray the cost of Medicaid in the manner of a pension or social security.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© May 2011, Post 144
Tuesday, May 3, 2011
Designation of Agent Under a Power of Attorney
The significance of a power of attorney with respect to accessibility has been discussed in Post 54. Another significant aspect of the power of attorney is the designation of the agent. For example, if a husband and wife are adverse in any way, they should not be designated as agent. Similarly, children of the parents may feel that they do not want to serve as agents given a conflict situation.
As discussed in my webinar, Ethical Dilemmas for Elder Law Practitioners, although many conflicts can be waived, the seminal question is whether they should be waived. Therefore, counsel must address the question of representation of the husband and wife when they are adverse. The second issue is the designee of the agent who ideally would not be the spouse or children but should rather be an independent party.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© May 2011, Post 143
As discussed in my webinar, Ethical Dilemmas for Elder Law Practitioners, although many conflicts can be waived, the seminal question is whether they should be waived. Therefore, counsel must address the question of representation of the husband and wife when they are adverse. The second issue is the designee of the agent who ideally would not be the spouse or children but should rather be an independent party.
Disclaimer: This article does not constitute legal advice and each person may have unique facts for which legal consultation may be necessary.
© May 2011, Post 143
Monday, April 11, 2011
Meaning of "Assets" and "Resources"
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
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
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
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