CT bill HB 5324 is related to Medicaid eligibility. It would increase the minimum amount that a community spouse can keep from $23,449 to $50,000. This is a pretty big deal in the world of Connecticut Medicaid and it apparently has a chance to pass.
So, please take the time to contact your state represnetatives and senators and ask them to support the bill. Click here to find your legislators.
Not surprisingly, I am not a big fan of fill-in-the-blank estate planning documents that you can get online or from an office store. There are many reasons for that, but one big reason is that online forms for a durable power of attorney (POA) often do not offer a "gifting" provision. Or they do offer such a provision but there is no advisor involved to explain the benefits (or occassional pitfalls) ofincluding such a provision in your POA.
The take-home lesson for today is this: An agent under a POA cannot gift assets on your behalf without express authorization to do so in the POA document.
At first glance, this may not seem like a big deal. But it certainly becomes a big deal if/when transferring assets out of your name for Medicaid or tax purposes becomes highly advisable.
In the context of a Medicaid application, the State of Connecticut will most likely pretend that such a gift (made by a POA agent without authorization) didn't happen and treat the gifted asset as an "available asset" for the Medicaid applicant.
For real estate title purposes, if a POA agent transfers property without express authorization in the POA document then title to the property has not been effectively transferred.
These are just two examples of BIG problems that can occer when your POA document does not have adequate gifting language.
Of course, having said all of that, there can be good reasons to NOT include gifting powers in a POA, depending on the circumstances. The point is that this particular POA issue should be discussed with an experienced estate planning and/or elder law attorney.
The all-important disclaimer: This blog does not offer legal advice, nor does it create an attorney-client relationship. If you need legal advice, consult with a lawyer instead of a blog.
Concerns about "filial responsibility" or creating a legal obligation for children to financially support their parents, has recently surfaced as a national concern (with good reason) in the nursing home / Medicaid context.
Much to my surprise, it turns out that Connecticut is one of the 30 states with such a law. I say "surprise" because in nearly 15 years of practice I have never heard of the Department of Social Services citing or enforcing this law. Nonetheless, it is on the books, so you should be aware of it.
On the bright side, it is not as troubling as other state laws since it creates a legal obligation to support indigent parents who are under age 65. That means it's not a concern for the vast majority of families in Connecticut facing nursing home placement issues. Still, it could be an issue for some families if the State ever begins enforcing this law.
On the down side, it does carry a prison sentence if the support duty is not fulfilled without good cause.
Click here for an online Forbes article on this topic.
Click here for the statute itself.
I'm happy to report that Governor Malloy recently signed a bill into law which mandates that the State ignore any income from the VA's Aid & Attendance pension benefit program when determining eligibility for several government programs.
Fortunately, the list of government programs includes Medicaid, SAGA cash, the Connecticut Home Care Program for Elders and the State Supplement for SSI!
The Medicaid program's treatment of annuities is one of the biggest sources of confusion for my clients.
So...if you have an annuity and you apply for Medicaid, is that going to be a problem? The answer is the same as it is for most legal questions: "It depends".
The current rule regarding annuities, which has been in place since February of 2006, is that an annuity is not a countable asset for Medicaid eligibility purposes if the following requirements are met:
1. "Actuarilly sound". In other words, the payment term of the annuity cannot exceed the annuity owner's life expectancy. Furthermore, the grand total of the annuity's planned payments cannot exceed the cost of the annuity.
2. Non-transferable. Pursuant to the annuity contract, the annuity owner must be prohibited from transfering ownership of the annuity to another person.
3. Irrevocable. Except for the regular annuity payments, the annuity owner cannot withdraw funds from the annuity.
4. State as Beneficiary. Here's the one that my clients find the most frustrating; the State must be the primary beneficiary upon the annuity owner's death, up to the cost of care that the State has provided for the annuity owner. If there is a spouse or a minor or disabled child, then the State must be the secondary beneficiary.
The State is generally wary of annuities and they will strictly apply this test. So keep this information in mind if you are a senior and considering the purchase of an annuity.
When the State of Connecticut tallies up your assets in order to determine if your asset level is low enough to qualify for Medicaid, they will only look at your "available" assets (and your "non-exempt" assets).
"Available" assets is defined under Connecticut General Statutes section17b-261(c): "For purposes of determining eligibility for the Medcaid program, an available asset is one that is actually available to the applicant or one that the applicant has the legal right...to obtain or have applied for the applicant's general or medical support" (emphasis added).
So, cash in the bank in an account with your name on it is obviously something that is "available" because it's "actually" available. You can go to the bank whenever you want, grab the cash and spend it for your own long term care.
But what about money in a trust for which you are the benefiary? Well, it depends. If the State reviews the trust and finds any language that allows the Trustee to use the money for your medical care then it's "available" to you. Whether the Trustee actually uses the trust funds for your benefit is irrelevant. The mere fact that the Trustee is authorized to use the trust funds to pay for your medical care means that the trust funds are "available" to you under Medicaid.
So remember...just because assets are in a trust and beyond your direct control doesn't necessarily mean they are protected from a Medicaid spend-down!
I'm happy to report on a positive development at Connecticut's Department of Social Services (DSS), which is the entity that is in charge of processing Medicaid applications and determining eligibility.
You're probably aware that there is a five-year look-back period (it was a three-year look-back until 2006) associated with Medicaid applications. In other words, DSS will essentially audit your financial records for the five-year period leading up to the filing of your Medicaid application. Up until now, that required your submission of five years worth of monthly statements for every account/asset that has (or had) your name on it. That's an awful lot of paperwork.
Well, now DSS has apparently acknowledged that IF a Medicaid applicant has gifted money out of her name with the intent of protecting it from the nursing home, that transfer has most likely taken place in the past two years. I'm not sure if this conclusion is based on hard data or if it's just a guess. But either way, I suppose the logic makes sense.
Anyway, in light of this conclusion, DSS is now going to require monthly statements for assets over the past TWO years (no longer five) and then one statement for every six-month period for the other three years of the look-back.
In other words, it's still a five-year look-back, but now they're going to take a "hard" look at the past two years and a "soft" look at the other three years. The result is much less paperwork to collect and submit.
And, presumably, applications will be processed more quickly. This may be the main driving force behind this change since most DSS caseworkers seem to be struggling with an unholy backlog of applications to review.
IMPORTANT: Please note that I'm providing this update based on a brand new memo that is being circulated through DSS regional offices. However, I do not have any first-hand experience with this new process, and I'm not aware of any elder law colleagues who have any first-hand experience with this either.
So now we just need to hope that this new approach is actually implemented. We'll see...
For whatever reason, as of January 1st, "Husky Health Connecticut" includes long-term coverage groups, such as Medicaid. Specifically, it's called "Husky C".
I have elderly/disabled clients who are used to receiving gray benefit cards from the State. Now their cards have the picture of the cute husky-dog on it, and it triggers some confusion because Husky Health is usually associated with children.
Well, not anymore! And why not? Well, your guess is as good as mine.