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MEDICAL ASSISTANCE: A SUMMARY OF THE BASIC ELIGIBILITY REQUIREMENTS

MEDICAL ASSISTANCE: A SUMMARY OF THE BASIC ELIGIBILITY REQUIREMENTS. Laurie Hanson Long, Reher & Hanson, P.A. www.mnelderlaw.com  2008 Long, Reher & Hanson, P.A. Long Reher Hanson Minnesota Elder Law Attorneys. Course Overview.

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MEDICAL ASSISTANCE: A SUMMARY OF THE BASIC ELIGIBILITY REQUIREMENTS

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  1. MEDICAL ASSISTANCE: A SUMMARY OF THE BASIC ELIGIBILITY REQUIREMENTS Laurie Hanson Long, Reher & Hanson, P.A. www.mnelderlaw.com 2008 Long, Reher & Hanson, P.A. Long Reher Hanson Minnesota Elder Law Attorneys

  2. Course Overview • Long-term care payment sources • Basic Medical Assistance Eligibility • Assets • Spousal Impoverishment Laws Long Reher Hanson Minnesota Elder Law Attorneys

  3. Course Overview • Income • Transfers • Appeals/hardship waivers • MA Waiver programs Long Reher Hanson Minnesota Elder Law Attorneys

  4. Why does this Matter? Planning for persons who are living with disabilities who must maintain or obtain eligibility for public benefits to meet basic needs and use. To enhance quality of life – to live as independently as possible for as long as possible To ensure that assets can be protected to supplement and not supplant government benefits. Long Reher Hanson Minnesota Elder Law Attorneys

  5. WHAT IS LONG-TERM CARE? A person who needs assistance with activities of daily living, such as bathing, dressing, eating, transferring, is a person who needs long-term care. Long Reher Hanson Minnesota Elder Law Attorneys

  6. Long-term care settings Home Health Care Adult Day Services Assisted Living Skilled Nursing Facilities Board and Care Homes Group Residential Housing Hospice Care Long Reher Hanson Minnesota Elder Law Attorneys

  7. Long-Term Care payment sources. • Private pay/private insurance • Medicare and supplemental insurance • Long-term care insurance • Veterans Benefits/ Veterans Home Long Reher Hanson Minnesota Elder Law Attorneys

  8. Medicaid State and Federal program Minnesota’s Medicaid Program is called Medical Assistance Basic Medical Assistance Medical Assistance for the nursing home Home and Community-Based waivers Long Reher Hanson Minnesota Elder Law Attorneys

  9. Home and Community Based Medical Assistance programs* for persons under age 65: *Also known as “waiver” programs. Mental Retardation or Related Conditions (MR/RC) Community Alternative Care (CAC) Community Alternatives for Disabled Individuals (CADI) Traumatic Brain Injury (TBI) Long Reher Hanson Minnesota Elder Law Attorneys

  10. Home And Community Based Medical Assistance Programs for people 65 and Older: Elderly Waiver Program (EW) Special Income Standard Elderly Waiver program (SIS EW) Alternative Care program (AC) (not MA) Long Reher Hanson Minnesota Elder Law Attorneys

  11. Medical Assistance Services Medical Assistance benefits include: Hospitalization, physician services, some dental and eye care, medical supplies and treatments, etc Mental health services for adults and children Nursing homes Home health care. Long Reher Hanson Minnesota Elder Law Attorneys

  12. MA ELIGIBILITY GENERAL REQUIREMENTS • Minnesota resident • Categorical Basis of Eligibility • 65 and older Blind or Disabled • Pregnant woman • Under 21 • Parent or caretaker of dependent child • Financially Eligible

  13. Basic Financial Eligibility Single $3,000 in available assets Income spenddown Married Community spouse asset allowance + $3,000 Income spenddown Long Reher Hanson Minnesota Elder Law Attorneys

  14. WHICH ASSETS COUNT TOWARD THE $3,000? Excluded Assets (no) Unavailable assets (no – but used on asset assessment) Available Assets (yes) Long Reher Hanson Minnesota Elder Law Attorneys

  15. Available assets • Assets are available if the owner has both legal authority and actual ability to use them for self-support and assets are not excluded or unavailable. • Include savings and checking accounts, stocks, bonds, CDs, contracts for deed, IRAs, certain real property, collections, cash surrender value of life insurance policies, etc. • Premarital agreement has no effect.

  16. Excluded assets • Homestead subject to limit in some circumstances (eff. 1/1/06) • Household goods and personal effects • Assets of trade or business • One motor vehicle

  17. Excluded assets • Insurance payments to repair or replace lost, damaged, or destroyed property • CSV of certain insurance policies • Revocable burial fund: limit is $1,500 • Irrevocable funeral trust: • Services limited to $2,000 • No limit for burial spaces and space items

  18. Prepayment of funeral • Life insurance or annuity: • Itemized agreement with funeral home • Amount paid same as in agreement • Irrevocable primary beneficiary: “any funeral home as its interest may appear” • Irrevocable contingent beneficiary: “estate”

  19. Unavailable assets Unavailability proved by showing legal or actual barrier to disposal of asset that cannot be overcome. Unavailable assets may include: Next four slides…

  20. Unavailable assets Share of an estate that has not been probated Property involved in a pending legal action

  21. Non-homestead real property • Considered unavailable as long as applicant is making reasonable effort to sell • Asking price is no more than estimated market value on real property tax statement • Reasonable offer: no less than 2/3 EMV

  22. Jointly held assets • General rule: Presumption that joint tenants own pro rata share • Exception: Checking or savings account, time deposits owned by MA applicant • Savings bonds: Unavailable if owned jointly and in possession of person who is not applying for MA

  23. Life Estates and Joint Tenants • Life tenant has the right to: • Live in the property throughout lifetime • Receive all profits from the property • Life tenant has continuing obligation to: • Pay property taxes, fire insurance, maintenance • Life estate is extinguished at death unless after August 1, 2003

  24. Trusts: available? Depends on: (1) Kind of trust involved (2) Who established the trust (3) Whose assets were used to fund the trust…and

  25. Trusts: available? (4) Whether the trust is revocable or irrevocable (5) Whether trust was established during lifetime or through a will (6) Provisions of the trust agreement

  26. Kinds of trusts • Revocable trust • Irrevocable Trust • Trust with springing provisions • Supplemental needs trust • Special needs trust • Pooled trust

  27. Other assets • Annuities • Continuing Care Communities

  28. Bob’s and Kate’s assets • Certificates of deposit $125,000 • Kate’s IRA $65,000 • Bob’s IRA $35,000 • Homestead $300,000 • Automobile $ 20,000 • Household stuff $15,000 • 1/2 lake property $50,000

  29. Bob’s and Kate’s assets • Certificates of deposit $125,000 Available • Kate’s IRA $65,000 • Bob’s IRA $35,000 • Homestead $300,000 • Automobile $ 20,000 • Household stuff $15,000 • 1/2 lake property $50,000

  30. Bob’s and Kate’s assets • Certificates of deposit $125,000 Available • Kate’s IRA $65,000 Available • Bob’s IRA $35,000 • Homestead $300,000 • Automobile $ 20,000 • Household stuff $15,000 • 1/2 lake property $50,000

  31. Bob’s and Kate’s assets • Certificates of deposit $125,000 Available • Kate’s IRA $65,000 Available • Bob’s IRA $35,000 Available • Homestead $300,000 • Automobile $ 20,000 • Household stuff $15,000 • 1/2 lake property $50,000

  32. Bob’s and Kate’s assets • Certificates of deposit $125,000 Available • Kate’s IRA $65,000 Available • Bob’s IRA $35,000 Available • Homestead $300,000 Excluded • Automobile $ 20,000 • Household stuff $15,000 • 1/2 lake property $50,000

  33. Bob’s and Kate’s assets • Certificates of deposit $125,000 Available • Kate’s IRA $65,000 Available • Bob’s IRA $35,000 Available • Homestead $300,000 Excluded • Automobile $ 20,000 Excluded • Household stuff $15,000 • 1/2 lake property $50,000

  34. Bob’s and Kate’s assets • Certificates of deposit $125,000 Available • Kate’s IRA $65,000 Available • Bob’s IRA $35,000 Available • Homestead $300,000 Excluded • Automobile $ 20,000 Excluded • Household stuff $15,000 Excluded • 1/2 lake property $50,000

  35. Bob’s and Kate’s assets • Certificates of deposit $125,000 Available • Kate’s IRA $65,000 Available • Bob’s IRA $35,000 Available • Homestead $300,000 Excluded • Automobile $ 20,000 Excluded • Household stuff $15,000 Excluded • 1/2 lake property $50,000 Unavailable

  36. TERMINOLOGY: Married Couples Community Spouse Ill Spouse (long-term Care Spouse) Asset Assessment Date Community Spouse Asset Allowance Community Spouse Income Allocation. Long Reher Hanson Minnesota Elder Law Attorneys

  37. Community spouse asset allowance • CSAA = 1/2 of non-excluded assets on asset assessment date with a • Minimum of $29,389 and • Maximum of $104,400 • assets at time of MA application = CSAA + $3,000

  38. Date of Institutionalization $35,000 • Protected Assets: • CSAA $29,389 • MA limit $ 3,000 • Excess Assets: $ 2,611 Date of MA application, if in 2008: $29,389 $3,000

  39. Date of Institutionalization $100,000 • Protected Assets: • CSAA $50,000 • MA limit $ 3,000 • Excess Assets: $ 47,000 Date of MA application: $50,000 $3,000

  40. Date of Institutionalization $220,000 • Protected Assets: • CSAA $104,600 • MA limit $ 3,000 • Excess Assets: $112,400 Date of MA application, if in 2008: $104,400 $3,000

  41. Kate’s and Bob’s community spouse asset allowance • Total non-excluded assets • CDs $125,000 • Kate’s IRAs $ 65,000 • Bob’s IRAs $ 35,000 • 1/2 interest in lake property $ 50,000 • Total $275,000 • 1/2 of total is $137,500, which is greater than $104,400, so CSAA = $104,400. Excess assets to be reduced = $167,600.

  42. MEDICAL ASSISTANCE:DISCUSSION OF INCOME RULES

  43. Types of income Excluded income Reverse mortgages Payments form low-income home energy programs In-kind income Cash from sale of property Tax refunds Reimbursement of expenses Long Reher Hanson Minnesota Elder Law Attorneys

  44. Types of income Available income Received by individual or on her behalf Earned Income Unearned Income Annuity payment RSDI, SSI Trust disbursments Regularly received gifts Lump sums Long Reher Hanson Minnesota Elder Law Attorneys

  45. Income Rules for Recipients in the Community MA recipient is required to pay portion of income towards cost of services Income standards for persons living in community: 100% FPG, currently $851 OR Spending down to 75% FPG ($639). Long Reher Hanson Minnesota Elder Law Attorneys

  46. Income Spenddown for Single Person in Community: Income of Individual $2,000.00 less Medicare Part B -96.00 less standard -650.00 less insurance premium -100.00 Income applied to care $1,154.00 Cost of Care $5440.00 less -1,154.00 MA pays: $4,286.00 Long Reher Hanson Minnesota Elder Law Attorneys

  47. Income Spenddown for Single Person in Nursing home: Income of Individual $2,000.00 less Medicare Part B -96.00 less personal needs allowance - 84.00 less insurance premium -100.00 Income applied to care $1,720.00 Cost of Care $5,440.00 less - 1,720.00 MA pays: $3,720.00 Long Reher Hanson Minnesota Elder Law Attorneys

  48. SPECIAL INCOME RULES FOR MARRIED COUPLES Community spouse is eligible for a spousal income allocation if his or her income does not meet a minimum income level Minimum of $1,751 up to Maximum of $2,610 Calculation takes into account ONLY excess shelter costs. Long Reher Hanson Minnesota Elder Law AttorneysC

  49. SPECIAL INCOME RULES FOR MARRIED COUPLES This amount changes every year Otherwise spenddown is the same as for single person Only applies to long term care MA (LTC MA) or EW Long Reher Hanson Minnesota Elder Law Attorneys

  50. Income Spenddown for Married Person in Nursing home: Income of Ill Spouse $2,000.00 less Medicare Part B -96.00 less personal needs allowance - 84.00 Less community spouse allocation -1,500.00 less insurance premium -100.00 Income applied to care $ 220.00 Long Reher Hanson Minnesota Elder Law Attorneys

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