The Medicaid
Thicket I
Bob Mason
Originally
published in Coastal Senior
(March 2007)
Much of what seniors
watch and worry about are
things that I deal with
everyday. I’m an elder law
attorney. Elder law is all I
do. I get great satisfaction
out of my job because I
believe I am able to lead my
clients through a confusing,
and often frightening, legal
thicket.
Coastal
Senior asked me to
contribute a monthly column
on legal issues of interest
to readers. I told my editor
that the biggest challenge
would be trying to decide
which of the many legal
issues to cover. My email
address appears at the end
of this column. If you have
an idea for a column, let me
know. I’ll see if I can’t
take it on.
First,
a brief introduction. I help
seniors, disabled
individuals and their
families throughout North
Carolina from offices in
Asheboro, North Carolina,
and in the Savannah area
from offices in downtown
Savannah.
I am a
certified elder law attorney
by the National Elder Law
Foundation, and about to
begin serving as the Vice
Chair of the Elder Law
Section of the North
Carolina bar. Perhaps most
importantly, I married a
Savannah native some years
ago, and with her I am
raising a little Savannah
native. So we split our time
between North Carolina and
Savannah.
‘Nuf
about me.
In the
next few issues of
Coastal Senior I’ll look
at Medicaid rules covering
payments for nursing home
care. Medicaid myths abound
and the misinformed folks
called “They & Them” never
seem to get their
information right (my
clients are always saying
“Well, Bob, They say
that . . .”).
For
those who may be depending
on Medicaid to cover nursing
home care: Beware. About a
year ago (and by the
narrowest of margins)
Congress imposed new rules
that penalize asset
transfers occurring within
five years of a Medicaid
application. A penalty means
the applicant could be
ineligible for Medicaid for
a period of time. If an
ineligibility period
applies, then it would not
begin to run until Grandma
is in the nursing home and
otherwise financially
qualified for Medicaid.
With
three days advance notice,
Georgia rolled out new rules
effective February 1.
Everyone is trying to figure
out what they do and how
they are supposed to work.
South Carolina can’t be far
behind.
First
understand the old rules.
The old rules generally
provide a three year look
back period and begin
ineligibility (or sanction)
periods back on the first
day of the month in which
the transfer was made. For
example, $20,000 transferred
two years before an
application would create a
four month sanction period
that expired 20 months ago.
No problem!
Under
the new rules, a $20,000
transfer made after February
8, 2006 (not a typo: 2006)
creates a four month
ineligibility period
beginning anytime within the
next five years when Grandma
enters a nursing home and
is financially qualified.
Say Grandma and Grandpa
transferred $20,000 on
February 9, 2006, when all
was well. Grandpa dies in
2008. In 2010 Grandma goes
into a nursing home with
$50,000. First, she’ll need
to do something about the
$50,000 (which is too much
to qualify for Medicaid).
After spending at least
$48,000, and with just
$2,000 left, she would
remain ineligible for
Medicaid yet another four
months because of the
transfer in 2006!
Neither
Congress nor the states have
thought through the problems
this will cause. A nursing
home cannot discharge a
resident without a safe
destination to discharge the
patient to. Even if the
patient does not or cannot
pay. If Grandma goes to a
nursing home and pays her
own way for maybe two years
(spending $120,000 or so in
the process) before going
broke, the nursing home will
be stuck if a Medicaid
penalty begins when Grandma
goes broke . . . there will
be nowhere to discharge her
to. If instead Grandma has
to go to the hospital,
before going to a nursing
home, no nursing home will
take her if they think there
will be a Medicaid penalty.
I will
say this at the end of every
Medicaid column I write:
There are many things that
can be done to help. Maybe a
lot. The earlier you start,
the better. Don’t wait for a
crisis.
Next month we’ll talk about
the types of assets you can
own and other options you
may have. Stay tuned!
