When people discuss long-term care and Medicaid, the conversation usually focuses on institutional care (i.e hospitalization or nursing home care.)
However, government health programs, medical professionals and consumers are increasing their support of in-home or “community based” long-term care as both a cost savings measure and as a personal preference for non-institutionalized care. Long-Term Care Services include medical, social, housekeeping, and rehabilitation/physical therapy services that a person needs over months or years in order to improve or maintain function and health. This care can be provided in people’s homes or in community based settings, such as assisted living facilities. Medicaid home and community based services are available through “waiver” programs to groups of individuals who would otherwise be eligible for Medicaid if institutionalized, and, except for the services, would be institutionalized in the hospital or a nursing facility.
Under the Social Security Act, the Federal Government grants waivers of certain requirements that are otherwise applicable to Medicaid State plan services, which were at one time available only in institutional settings. New York has had a variety of different programs for in-home care through its Personal Care Program and the Lombardi Program for Long Term Home Health Care Program. Such waiver programs provide flexibility in the Medicaid laws to allow states to create waiver programs that target only a particular population limited by age, diagnosis or geographic area of the state; or avoid limits on the number of waiver slots available.
Waiver of the financial eligibility requirements also allows the States to include individuals who would not normally meet Medicaid income resource guidelines. In 2014, a couple applying for community in-home based Medicaid must spend down their assets to a minimum of $21,450.00 (couples) and $14,550 (singles) in total available resources and $1,192(couples) and $809 (singles) as an income allowance. “Available resources” are those asset which a Medicaid applicant and a spouse have incidences of ownership (i.e., control and direction.) In order to apply for in-home community care paid through the Medicaid program, you must qualify for one of the waiver programs where various rules may have been based upon general guidelines.
There are various waiver programs that allow for higher amounts of available resources and income levels, or a spouse who is not in need of medical assistance. All of these factors should be carefully reviewed before applying for a particular program. One of the biggest financial differences between nursing home and community based care relates to the eligibility to qualify for Medicaid, particularly, transfers of assets made in order to qualify for Medicaid. When applying for Medicaid for nursing home care, there is a 60- month “look back” period in which the agency reviews all financial transactions during that period to determine whether a Medicaid applicant transferred any assets for less than fair market value during the “look back” period. If there were any such assets transferred as a gift or a non-arms-length transaction, there would be a penalty period calculated to determine the number of months the Medicaid applicant would be ineligible to receive Medicaid assistance. However, these transfer penalty rules do not apply to qualify for community-based home care medical assistance, assuming the individual otherwise qualifies for these types of services and programs. The community based Medicaid program allows for the transfer of assets to third parties to reach the maximum level of available resources without imposing a penalty. However, it should be noted that if that Medicaid recipient later requires nursing home care within the 60-month period, such transfer rules will be applied to potentially deny eligibility for a number of months of nursing home care.
Short of inventing a crystal ball to determine what the future holds in terms of your future health care needs and changes in the programs, benefits and qualification requirements, families, especially with seniors approaching the where age they will need these types of services, should evaluate the relative importance of qualifying for Medicaid by making appropriate estate planning decisions at an early point in time vs. their ultimate inability to transfer assets to their intended beneficiaries at death as a result of having one’s estate depleted for long-term care. Our office can assist you in obtaining the necessary information to provide proper guidance as it relates to the Community Based Medicaid Programs and how best to plan your estate in light of your testamentary intent.