Medicaid, the medical services assistance program for low-income individuals, is funded by the federal and state governments. While many of the families we serve would not normally fall under the “low income” category, discussing Medicaid as a possible asset protection strategy may be beneficial. The Medicaid benefits that our clients apply for include Vendor Medicaid, Supplemental Nursing Care, and Home and Community Based Services.
Although officially called MO HealthNet for the Aged, Blind and Disabled (MHABD), in Missouri, it is commonly referred to as Vendor Medicaid. This program is administered by the Family Support Division (FSD). Unlike Medicare, this may pay indefinitely for the care of qualified individuals who reside in skilled nursing facilities. In general, Vendor Medicaid pays the difference between the person’s income and the total bill each month.
An individual must meet the following criteria to qualify for Vendor Medicaid:
- Reside in a licensed skilled nursing facility in a Medicaid-certified bed.
- Meet the medical disability standard of federal and state law – over age 65, disabled or blind.
- Not have countable assets worth more than $3,000 as of 7/1/18 (please note that this amount is scheduled to increase every year until FY 2021)
Our attorneys can help you with Asset Protection strategies so that you do not spend your life savings.
Declaration and Assessment of Assets for Married Couples
Federal and state guidelines allow married couples a “Declaration and Assessment of Assets,” which permits the spouse who does not become a long-term care resident (known as the “Community Spouse”) to keep all or part of the couple’s assets. In order to complete this assessment, one spouse must already be in a nursing home or in the hospital with a transfer to the nursing home with an expected stay of at least 30 days. The assessment is always completed with the FIRST institutionalization of 30 days or longer.
Once the Family Support Division completes the “assessment of assets” calculation, then a married couple knows the amount that they must spend down to in order for the spouse in the nursing home to become eligible for Medicaid. A married couple can use this money to pay for anything that benefits either spouse, not just payment for long term care. This includes but is not limited to normal monthly bills, outstanding credit card bills, home repairs or remodeling, replacement of an automobile, funeral plans etc. However, the individual eligibility specialist at the Family Support Division who is handling the claim may not explain to an applicant or his or her family the different ways that assets can be spent or saved from being spent to pay for care. By meeting with one of our attorneys, we can protect as much as possible for the Community Spouse. In other words, the spouse who remains at home does not have to spend down as they may have been led to believe.
Home and Community Based Services
Home and Community Based Services (HCB) is jointly administered by the Department of Health & Senior Services (DHSS) and the Family Support Division. This program allows a claimant to receive some care in their home rather than go to a nursing home. An evaluation by DHSS is required to assess the claimant and determine what services may be provided. This assessment must be completed after the Medicaid application is made but prior to approval. The claimant must meet the age criteria, be determined by the assessment to need care at the nursing home level and meet the gross income limits established. It is important to note that this is not 24/7 care. The DSSS worker will determine how many hours per week a claimant is eligible to receive.
Supplemental Nursing Care
There is a form of Medicaid that is available to those who are in an Assisted Living Facility (ALF) or in a private pay nursing home. This program is called Supplemental Nursing Care (SNC). Unlike Vendor Medicaid, a single claimant for SNC is only allowed to have up to $999.99 in total assets. A married claimant may have up to $2,000. If the claimant does not have enough monthly gross income to pay for their care, they may receive a up to $292 per month (or $390 if in a private pay skilled nursing home) to help pay the cost of care and $50 for personal spending. This is either a paper check or a direct deposit to the claimant’s bank account. It is NOT a payment directly to the facility. In addition, those eligible for this program also receive state payment of the Medicare premium that is currently deducted from their monthly SS check and Medicaid coverage which can help with medical costs not covered under the traditional Medicare program. SNC also pays for the individual’s prescription drug cost by simply presenting his or her card to the pharmacy (a small copay is usually required).
Transferring Assets to Children and Family
Under state and federal law, individuals who transfer any assets such as cash, investments and real estate, to someone other than a spouse may incur a penalty if the transfer occurred within the five years before applying for Vendor Medicaid or HCB. (There is currently no penalty for SNC.) The term of the penalty period is determined by the amount of the transfer. During the penalty period, a claimant is not eligible for Vendor Medicaid or HCB. Any transfers of assets that occurred five (5) years or more before the application for Medicaid is filed will not be considered.
This is a great example as to how important it is to begin asset protection planning well in advance – it can make a huge difference for a family! At the same time, it is often best not to transfer assets without first consulting an attorney who specializes in elder law. There are many techniques available as well as exceptions to the rule that only an expert in this area, such as an experienced elder law attorney, should be relied upon to guide an applicant and his or her family in these situations.
Words of Wisdom
Medicaid is a very complicated matter. When to apply, what assets are countable, how to protect those assets, what to do while waiting for approval and how much will need paid to a nursing home will all be discussed with you. Each case is different and what works for one family, may not work for another.
The information we have provided above just barely scratches the surface of everything important to know about Medicaid. For a more comprehensive description of Medicaid rules, please click on the link below.
As has been mentioned several times in the information above, we would strongly recommend you come see us before taking any action on your own in regard to the transfer of assets or applying for Medicaid. One wrong move, and you could unknowingly cost your family thousands of dollars that could have been protected.