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Medicaid Planning

Troy Medicaid Planning Attorneys

Does Medicare pay for long term (nursing home) care?

Unfortunately, Medicare does not pay for extended stays in a nursing home. Under certain limited circumstances, however, Medicare can cover some of the cost of staying in a nursing home when you are actively rehabilitating or when medical care is required (i.e. for tracheotomy, wound care, intra venous medications, etc.). In order to receive Medicare coverage for a nursing home stay, admission to the nursing home must follow a hospital stay of at least three days, and either the patient must be actively participating in rehabilitation and getting better or the patient must require nursing (not merely custodial) care. Under those circumstances, Medicare will pay for the first 20 days of a nursing home stay completely, meaning the patient has no obligation to contribute.

Medicare will keep paying part of the cost for days 21 through 100, but the patient is required to pay a copay, which is $144.50 per day for 2012. It is very common for Medicare to terminate coverage after the initial 20 days, usually based on allegations that the client isn't participating or improving with therapy or that he or she no longer requires nursing care.

Does Medicaid pay for long term care?

Yes, but only if the person is not only physically eligible for care in a nursing home, but also financially eligible. It is important to note that this question is only applicable to institutional care and does apply to the requirements for community Medicaid, which is different from Institutional Medicaid. In order to be eligible for Medicaid, a single person can have no more than $14,250 in non-exempt resources. He or she is required to pay all income over to the nursing home on a monthly basis except $50, which can be kept for personal needs.

The spouse of a person in a nursing home can keep all exempt resources (including the house, car and personal property) and can keep financial assets with a value not less than $74,820 or half of the couple's assets up to a maximum of $113,640, whichever is greater. In addition, the community spouse can keep up to $2,841 per month in income. If the patient and family meet these financial eligibility requirements, the institutionalized spouse should be eligible for Medicaid benefits unless he or she (or the spouse) has made an uncompensated transfer (gift) within the 60 months prior to a Medicaid application. In that case, there may be a period in which the patient is not eligible to receive benefits.

It is important to be sure that you are applying for Medicaid at the right time, since applying less than 60 months after a gift may result in an eligibility period of longer than what remains of the 60 months, while submitting the application after the 60 month period is over may result in no ineligibility period at all. Medicaid eligibility is a complicated area of law, and it is better to get help than to try to navigate these waters alone.

What kind of insurance can I get to pay for nursing home care?

New York State has a variety of Long Term Care insurance options, but the options can typically be categorized as either "Partnership" or "Non-Partnership". New York is one of the states that has a partnership between the State and private industry, providing an insurance product that is part private insurance and part government benefit. A policy that meets the standards of the New York State Partnership for Long Term Care must provide a certain minimum standard of benefits and, following the policy period (i.e. three years), the applicant is eligible for Medicaid WITHOUT having to meet the resource guidelines ($14,250 for a single applicant and no more than $113,640 for the spouse of a married applicant).

Medicaid permits the owner of a "partnership" policy to keep all of his or her resources and simply pays for the cost of his or her care after the owner pays all non-exempt income to the nursing home. A non-partnership policy doesn't link with Medicaid, and doesn't meet the minimum requirements of the Partnership policy, however, depending on the needs of the individual, a non-partnership policy may meet your needs better than a partnership policy. New York State has a great guide to Long Term Care Insurance. You can find it at www.dfs.ny.gov/insurance/ltc/ltc_guide.pdf.

What can I do to avoid spending all of my money on nursing home care?

There are a number of options for protecting assets from the cost of nursing home care, accelerating Medicaid eligibility, and ensuring that all or some of the money you've saved gets to your children, grandchildren or other beneficiary of your choosing. Unfortunately, most of these options require you to partially or fully divest yourself of control over the money.

Typically, we use a combination of gifts to individuals or trusts and, when necessary, loans, to get a client eligible for Medicaid while protecting as much as we can. The more the client does at least five years prior to needing Medicaid, the more we can do. This is one of those areas in which waiting until the last minute can cost a lot of money.

How far ahead should I plan for Medicaid?/What can I do if I haven't done any planning and I need nursing home care?

Under the current laws, planning at least five years (60 months) in advance ensures that none of the assets you've given away or put in trust will be looked at in determining your eligibility for Medicaid. However, even if you've procrastinated, we can still implement some limited planning to protect some of your assets, including prepaying your funeral, repairing a home in which the community spouse lives and otherwise enhancing the value of your exempt assets by using non-exempt assets. It's not usually too late to do at least something to save some of your money.

Is an "Irrevocable Trust" or "Medicaid Trust" really irrevocable?

Much to Medicaid's dismay, in New York, even an "irrevocable" trust isn't always irrevocable. We are careful to draft our Medicaid trusts with provisions that ensure that, should situations change dramatically in the future, we will be highly likely to be able to revoke or partially revoke the trust to provide our clients with access to the funds. Although we can't guarantee that this will be possible, we take whatever steps are available to make invasion of the trust principle possible in the future.

Does Medicaid cover care at home?

Medicaid does cover care at home, but only under extremely rare and dramatic circumstances that don't apply very often at all to the elderly. Most people don't want to go to a nursing home and would prefer to be cared for at home and a lot of families want to care for their loved ones at home. However, this isn't always possible, even though all parties may have the best of intentions.

If a caregiver gets sick, he or she may no longer be able to keep up with the demands of caring for an elderly parent or spouse. Additionally, there are some types of care that simply can't be provided at home. Home care is expensive, and, unfortunately, most people can't afford to pay for care at home for as long as they might want it. A long term care insurance policy with a home care benefit is the best option for people who want to be cared for at home.

For more information on estate planning, medicaid planning or elder law, we encourage you to schedule a consultation with one of our attorneys. Please contact Bartle, McGrane, Duffy & Jones, LLP.

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