The Connecticut Elder Law Blog

What is the Medicaid "Pick-Up Date"?

A lot of my Medicaid clients get confused over the date that Medicaid coverage kicks in (also known as the Medicaid "pick up date") once Medicaid eligibility has been determined by the State of Connecticut.

The short answer is that Medicaid can start as early as the first day of the month during which the Medicaid "spend-down" was completed, assuming that there are no issues with periods of ineligibility that have been triggered by gifting during the look-back period.  So, if an applicant spends his/her assets down below the Medicaid asset limit ($1,600) on November 20th, then Medicaid coverage can begin retroactively on November 1st.

Why would it start later than the first of the month?  Because if the spend-down included private payments to the nursing home which effectively paid for nursing home care past the first of the month, then the nursing home would not need Medicaid coverage until later in the month.  So, in the above example, let's assume that the Medicaid applicant made a partial payment to the nursing home as part of her spend-down and that payment covered her up until December 10th.  In that case, the Medicaid pick-up date would be December 11th so that the payment for care would be "seamless" for the nursing home.

What are Your Odds of a Future Nursing Home Placement?

 

Whenever I sit down with clients to plan ahead for Medicaid eligibility we spend a lot of time walking through the worst-case scenario of permanent nursing home placement, thereby triggering approximately $12,000 per month in nursing home fees (Connecticut is the 2nd most expensive state in the U.S. when it comes to nursing home care).  But it's also important to at least consider the possibility that the client will never actually need to be placed in a nursing home. 

 

There is no "crystal ball" to use and nothing can be guaranteed but there are factors to consider when trying to determine the odds that you will need permanent nursing home placement at some point in the future.

 

Is there a history of dementia and/or Alzheimer's Disease in family?  It seems like these are the types of conditions that most often trigger the need for long-term, permanent nursing home placement and they are very hereditary.  Other issues like diabetes, a heart condition, a bad hip etc. can usually be handled adequately at home.  

 

Do children, grandchildren and other family members live nearby or are they beyond driving distance from your home?  The larger the local support network (usually a family-based network) the less likely that you will need to be permanently institutionalized.  

 

How extensive are your liquid assets?  Even if you don't have long term care insurance in place, the more you have in investments, bank accounts, retirement accounts, etc., there is a greater possibility that you will be able to provide yourself with home health care and/or companionship to keep you in the community.

 

I always advocate for planning for the worst (in this context, permanent nursing home placement) and hoping for the best.  However, you need to realize that future nursing home placement is not a "given", and if the chances of requiring institutionalization are remote based on your own set of personal circumstances then you should factor that into your planning. 

 

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.

 

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"Should I Gift My House to the Kids?"

Right off the bat, let me give you a warning that you will be disappointed by this post.  You probably Googled the above question and stumbled upon this post with the expectation that you will find a definitive "yes" or "no" answer.  Unfortunately, as simple as the above question sounds, the legal analysis used to come up with an answer to the question is lengthy enough that I would probably be committing legal malpractice by even suggesting that there is a universally applicable answer to the question about whether to gift the house to the kids. 

 

There.  Now that I got that out of the way, here's what you will learn from this post:  as self-serving as this may sound, in order to find a good answer to this question, you need to sit down with an experienced elder law attorney who can walk you through all of the pro's and con's of transferring ownership of the house to the kids (or someone else) in order to avoid the need to sell the house and spend the proceeds down on the nursing home at some point in the future. 

 

And here is a non-exhaustive list of all the issues to consider:

• Gift tax.
• Capital gains tax.
• The dreaded "5-year look-back" period for Medicaid.
• Will the kids turn evil someday (perhaps they already are evil?!) and try to evict you from the house?
• Will this transfer result in an unintended distribution of your estate upon your death?
• Will one of the kids get sued someday, resulting in a lien being slapped on the property?
• Will one of the kids get divorced someday, subjecting the house to a divorce settlement process?
• Are one of the kids getting asset-tested government benefits?
• Should you retain a "life use" (a.k.a. "life estate") in the property?  It could be helpful tax-wise, but it could be problematic for Medicaid eligibility.
• Will you lose a senior or veteran real estate tax credit that you currently enjoy?
• What are the odds that you (based on your health, family medical history, level of local family support) will need permanent nursing home placement in the future?

In short, whether to gift the house to the kids is a short and simple question.  But settling on the answer to that question is a complicated process with a lengthy list of issues to consider.  And since every family is different, there is no one-size-fits all answer to this question.  In other words, just because your neighbor three doors down the road gifted the house to his kids does not necessarily mean that you should too. 

 

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.

 

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CT Legislative Alert!

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.

Income Tax Deduction Limits for Long Term Care Insurance

I generally consider comprehensive long term care insurance as "Plan A" when it comes to protecting your assets from a future nursing home placement.  One benefit of this approach which is often overlooked is the ability to deduct the premium payments for income tax purposes...to a point.

Here are the 2014 income tax deduction limits for long term care insurance premiums:

Age 40 or less:     $370

Over 40 but not over 50:    $700

Over 50 but not over 60:    $1,400

Over 60 but not over 70:    $3,720

Over 70:    $4,660!

Effective Care Plan Meetings

If you have a loved one in a nursing home then you will be invited to attend a quarterly meeting to discuss how your loved one is doing and determine what course her care should follow going forward.  These meetings are usually called "care plan meetings/conferences" and they are required if the facility accepts Medicaid and/or Medicare.  

These meetings should not be taken lightly.  You should attend the meeting if at all possible and you should go there fully prepared with a list of specific questions for the nursing home staff.  This is your best opportunity to voice your concerns and determine whether your loved one is getting the best possible care.  This is also your chance to provide the staff with background information that could prove helpful in formulating the care plan.

I have been appointed many times by local probate courts to act as the conservator for seniors when family members and friends are unable to do so.  This means I have attended innumerable care conferences and I usually pose the following questions to the staff:

Have there been any notable changes in the resident's condition since the last meeting?  If so, what was the cause?

Is the resident participating in the facility's recreational/social events?  If not, can steps be taken to facilitate his/her participation?

Have there been any visitors for the resident since the last meeting?  If so, have those visits been helpful or detrimental to the resident's spirits?

What specific therapies are being provided?

Is the resident short on any personal items (toiletries, clothes, reading material, etc.)?

These are some of the standard questions I usually ask.  However, every resident is different.  So I suggest asking the above-mentioned questions as well as questions that are specific to your loved one's situation.

 

 

Connecticut's "Filial Responsibility" Law

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.

New T19 Application-Processing Approach at DSS

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...

 

 

Comparing Nursing Homes on the Web

Once the decision is made that a loved one needs a nursing home, the selection of which particular nursing home is vitally important.  As you can imagine, the quality of care at nursing homes runs a rather wide spectrum.

A good starting point is actually the Federal government's Medicare website which has a nursing home comparison page.  The federal data there provides extensive information on Medicaid and Medicare-certified skilled nursing facilities in your area.  They compare the quality of care for both rehab and long-term patients by including information on the percentage of patients whose walking has improved and patients with certain types of infections, such as bladder infections and bedsores. 

Please note that facilities with high percentages of bladder infections may indicate that they have trouble keeping their residents well-hydrated.  And unsually high percentages of bedsores hint at facilities not turning residents side-to-side in bed often enough and not keeping them clean.   

So, if you're looking for a nursing home for a loved one, or suspect you may need one in the foreseeable future then you may want to begin the search by taking a spin on the Medicare website.

Nursing Home Admission and Timing the Medicaid Spend-Down

In this post I would like to mention that there is a distinct advantage if your loved one applies for admission into a nursing home while still having significant assets in his name. 

Federal law dictates that once someone is a resident in a nursing home then the facility must provide the same level of care that it provides to all other residents regardless of whether the nursing home's bill is being paid privately or by Medicaid. 

In other words, everyone gets treated the same.  At least that's the story once you're in a nursing home, but it's a whole different story before you get in.

Here's one thing most people don't realize: a nursing home receives only about 60% of their private rate when the resident is on Medicaid. 

Why is this significant?  Because if a nursing home has two applicants for admission and one empty bed, and one applicant has private funds while the other applicant is on Medicaid then the nursing home will take the private-pay applicant over the Medicaid applicant ten times out of ten.

So...when you're planning for nursing home admission, Medicaid eligibilty and the spend-down make sure that you discuss this important issue with your elder law attorney and plan carefully.

I hope everyone enjoys the weekend!