Medicare Laws Change Again!
In previous issues of Elder Helper, I reviewed MA changes to the Medicaid laws. Luckily, many of those changes were repealed due to public outcry from senior advocacy groups. Medicaid is the program that pays for nursing home care if you can't afford it ( referred to as MassHealth in MA). The bad news is that the federal government will now impose new changes which have a detrimental effect on elderly and disabled persons. Protecting your home & assets, and becoming eligible for Medicaid is now much harder. Some of the changes are set forth below:
- The "look back period" will be extended from 3 to 5 years. The look back is the number of years prior to filing a medicaid application that financial information, including gifts and other transfers must be disclosed. If gifts or transfers are made more than 5 years prior to application, then such transfers will not effect Medicaid eligibility.
- Prior law required that a"transfer penalty" be imposed on elders who make gifts within the look back period. The length of the Medicaid ineligibility penalty depended on the amount of the gift and started in the month the gift was made. The new law imposes the Penalty Period starting from when the applicant enters the nursing home and would otherwise be eligible for Medicaid benefits - that is, when all of their funds are gone! This eliminates most gift giving unless gifts are made beyond the 5 year look back period.
- The assets a community spouse is allowed to keep for support and maintenance will be substantially reduced under the new "income first rules" now mandatory for all states. MA already implements this rule.
- If the equity in your home is above $500,000, the state can deny you Medicaid benefits unless your spouse or disabled child lives in the home.
- Purchase of life estates, mortgages and annuities are now under much greater scrutiny. For example, the purchase of an annuity will be penalized unless the state is named as a remainder beneficiary.
Most individuals who make gifts are not aware of the possible consequences. A person who has spent down their resources may enter a nursing home only to discover they are ineligible for Medicaid because of payment for a grandson's college tuition or a gift to a needy child. If they have no funds, nursing homes will have the unpleasant choice of continuing care without pay or evicting the resident. Nursing homes are already struggling financially, and this additional burden will further strain their resources. Some are calling the new laws the "Nursing Home Bankruptcy Act of 2005".
If that's not scary enough, 30 states (not MA yet) now have laws that require children to be responsible for supporting their parents. States could impose civil/criminal penalties against children. This may trigger collection law suits against children by nursing homes.
THERE IS STILL TIME TO ACT IF YOU ARE IN OR ABOUT TO ENTER A NURSING HOME. BUT TIME IS SHORT! YOU MUST ACT NOW TO PROTECT YOUR ASSETS BEFORE MA ADOPTS THE NEW LAWS .
Is there someone who can help me with all of this?
You can get help from many professionals,from an Elder Law Attorney to a geriatric care manager, to social workers. Be sure to deal with a professional who understands the broad range of issues that arise when your or a loved one goes into a nursing home. Elder Services of Berkshire County has prepared a "Guide To Long Term Care" and a "Housing Options Guide". The guides provide information on nursing homes, assisted living arrangements,housing options, payment sources and other types of services and contact information. More information about these guides can be obtained by calling Elder Services of Berkshire County at (413) 499-0524.