Medicaid’s Coverage of Nursing Home Care — Lexington, KY

Medicaid’s Coverage of Nursing Home Care — Lexington, KY

For better or for worse, Medicaid is the primary method of paying for nursing home care in the United States. But navigating the Medicaid system is complicated and confusing. Here are the basics.  Medicaid (sometimes called by other names, such as “Medi-Cal” in California, “MassHealth” in Massachusetts, and “TennCare” in Tennessee) is a joint federal-state program that provides health insurance coverage to low-income children, seniors, and people with disabilities. In addition, it covers long-term care for those who qualify. This coverage has traditionally meant care in a nursing home, although coverage of care in an assisted living facility or at home are possible (see below).  In the absence of any other public program covering long-term care (Medicare provides only limited nursing home coverage), Medicaid has become the default nursing home insurance of the middle class. Lacking access to alternatives such as paying privately or being covered by a long-term care insurance policy, most people pay out of their own pockets for long-term care until they become eligible for Medicaid.  Each state operates its own Medicaid system, but this system must conform to federal guidelines in order for the state to receive federal money, which pays for about half the state’s Medicaid costs. (The state picks up the rest of the tab.) This complicates matters, since the Medicaid eligibility rules are somewhat different from state to state and they keep changing. To be certain of your rights, consult an elder law attorney in your state who can guide you through the complicated rules of the different programs and help you plan ahead.  While the majority of nursing homes accept Medicaid patients, there are some that do not. Even nursing homes that accept Medicaid recipients may only have a limited number of Medicaid beds available. Nursing homes must be certified by the state in order to accept Medicaid payments. Check with the facility before applying for admittance.  To qualify for coverage, applicants must have limited assets and income. You typically cannot have more than $2,000 in assets; the figure may be slightly higher in some states. To lower your assets, you need to spend them down by paying for things that benefit the Medicaid applicant. You cannot simply give away your resources in order to qualify for Medicaid. Income limits vary by state. In some states you can keep excess income in trust; in other states you must pay your excess income to the nursing home.  In addition to the strict income and asset limits, you must meet level of care requirements in order to qualify for nursing home coverage. Each state sets its own level of care criteria and the criteria is not always clear. The state looks at an applicants’ functional, medical, and cognitive abilities to determine if they need care in a nursing home. You are usually determined to need long-term care if you need help with two or more “activities of daily living” (such as bathing, dressing, eating, moving, and going to the bathroom). But to need a nursing home level of care, you may also need frequent medical care, such as assistance with medication, injections, IVs, or other medical treatment. The state may also consider your cognitive abilities—i.e., whether you have the ability to make decisions on your own.  Once you qualify for Medicaid, the program...

read more

What to Do With Your Stimulus Check if You Are in a Nursing Home — Lexington, KY

What to Do With Your Stimulus Check if You Are in a Nursing Home — Lexington, KY

As the second (and maybe third) round of stimulus checks go out, it is important to know that nursing home residents are not required to turn their checks over to their nursing home. And Medicaid recipients need to spend the cash within a year if it puts them over Medicaid’s resource limit.  In December 2020, Congress approved $600 stimulus checks for individuals making less than $75,000 a year. And Congress is currently considering whether to approve another round of $1,400 stimulus checks. Those checks should be sent to everyone eligible, including individuals on Medicaid and in a nursing home or assisted living facility.  The Federal Trade Commission (FTC) is reminding nursing home and assisted living residents that their stimulus checks are for them, not their facility. With the first round of stimulus checks, there were reports that facilities were taking the checks without residents’ permission. The FTC says that if nursing homes ask for a resident’s check, the resident should contact the state attorney general and the FTC.  Medicaid recipients who receive a stimulus check that puts them above Medicaid’s resource limit will need to spend down the money within a year or risk losing benefits. The Social Security Administration has said that it will not consider stimulus payments as income, and that the payments will be excluded from a Medicaid recipient’s resources for 12 months. The following are examples of what a Medicaid recipient may be able to spend the money on without affecting their eligibility: Make a payment toward paying off debt.Make small repairs around the house. Update personal effects. Buy household goods or personal comfort objects. Buy a new wardrobe, electronics, or furniture.Buy needed medical equipment, see a dentist or get eyes checked if those items aren’t covered by insurance. If you have questions about how you or a family member in a nursing home can spend the money, contact Gayheart Law. Call Melissa at (859) 276-6193 or request an appointment...

read more

Using Estate Planning to Prepare for Medicaid — Lexington, KY

Using Estate Planning to Prepare for Medicaid — Lexington, KY

Long-term care involves not only a loss of personal autonomy; it also comes at a tremendous financial price. Proper planning can help your family prepare for the financial toll and protect assets for future generations.  Long-term care can be very expensive, especially around-the-clock nursing home care. Most people end up paying for nursing home care out of their savings until they run out, at which point they can qualify for Medicaid to pick up the cost.  Medicaid rules require that recipients have no more than $2,000 in “countable” assets (the figure may be somewhat higher in some states) and limited income. Any excess assets need to be spent down before you can qualify for Medicaid. In addition, in order to be eligible for Medicaid, you cannot have recently transferred assets. If you transfer assets within five years of applying for Medicaid, you may be subject to a penalty period during which you cannot receive benefits. After you die, Medicaid also has the right to recover from your estate, which in the case of a Medicaid recipient usually means only the house. Careful planning in advance can help protect your estate for your spouse or children. If you make a plan before you need long-term care, you may have the luxury of distributing or protecting your assets in advance. This way, when you do need long-term care, you will quickly qualify for Medicaid benefits. The following are some tools that can be used in an estate plan to prepare for Medicaid:  Trusts. One of most important estate planning tools you can use is an “irrevocable” trust — a trust that cannot be changed after it has been created. In most cases, this type of trust is drafted so that the income is payable to you (the person establishing the trust, called the “grantor”) for life, and the principal cannot be applied to benefit you or your spouse. At your death the principal is paid to your heirs. This way, the funds in the trust are protected and you can use the income for your living expenses. For Medicaid purposes, the principal in such trusts is not counted as a resource, provided the trustee cannot pay it to you or your spouse for either of your benefits. However, if you do move to a nursing home, the trust income will have to go to the nursing home. And to avoid Medicaid’s “look-back period,” the trust must be funded at least five years before applying for benefits. Annuities. Annuities are another tool married couples can use to prepare for Medicaid. An immediate annuity, in its simplest form, is a contract with an insurance company under which the policyholder pays a certain lump sum of money to the insurer and the insurer sends the policyholder a monthly check for the rest of his or her life. In most states the purchase of an annuity is not considered to be a transfer for purposes of eligibility for Medicaid, but is instead the purchase of an investment. It transforms otherwise countable assets into a non-countable income stream. As long as the income is in the name of the spouse who is not in the nursing home, it’s considered non-countable. For single individuals, annuities are less useful, but if you transfer assets, you may be able to use...

read more

Who Should Purchase Long-Term Care Insurance? — Lexington, KY

Who Should Purchase Long-Term Care Insurance? — Lexington, KY

Buying long-term care insurance is one way to protect against the high cost of long-term care. However, this type of insurance may not be for everyone, so consider all your options. Long-term care – care in a nursing home or at home — may be paid for in four main ways:  Out-of-pocket. If you have sufficient resources, you can pay for your long-term care needs with money you have saved. Medicare. Medicare covers short-term nursing home stays after an illness or injury that requires hospitalization. Medicare covers up to 100 days of “skilled nursing care” per illness. Medicaid. If you have limited resources, Medicaid will pay for nursing home care. In order to be eligible for Medicaid benefits a nursing home resident may have no more than $2,000 in “countable” assets (it may be higher in some states). Long-term care insurance. With long-term care insurance, you pay monthly premiums to buy a policy that pays your long-term care costs if you are admitted to a nursing home or need home care (depending on the policy). Determining whether you need long-term care insurance depends, in part, on your financial situation. The cost of a long-term care insurance policy varies considerably, depending on your age when you purchase the policy, the benefit period, and the level of benefits, among other things, but the premiums can be expensive. Therefore, if you have the resources to self-insure your long-term care and still have money left over, you likely don’t need to buy a long-term care policy. On the other hand, if you cannot afford to pay monthly long-term care premiums, you will likely be able to qualify for Medicaid. Another factor to consider is your family’s health history. Most nursing home stays are short-term and paid for by Medicare. A common reason for needing extended long-term care is dementia. If you know you have a family history of Alzheimer’s disease, for example, it may make more sense to buy insurance. Of course, we never really know what the future may bring. Long-term care insurance is like any insurance policy: we don’t know if we will ever need it. In general, long-term care insurance is something to consider if: you have the resources to pay the premiums, even in retirement,you want to preserve your estate for your heirs, andyou don’t have enough money to self-insure. The ins-and-outs of estate planning and/or planning for long-term care are complicated and very dependent on your individual needs. For questions about your specific situation, give Gayheart Law a call today at (859)...

read more

What Is Critical Illness Insurance and Is It Worth Buying? — Lexington, KY

What Is Critical Illness Insurance and Is It Worth Buying? — Lexington, KY

Many employers offer critical illness insurance as part of their benefit package. What is this insurance and is it worth purchasing? Before paying for a plan, you should read the fine print and consider alternatives. While a regular health insurance plan usually offers comprehensive coverage for all types of illnesses, many plans have high deductibles and copays that require policyholders to pay a lot of money out of pocket. Critical illness insurance allows you to buy insurance to cover that gap if you have a serious health diagnosis, such as cancer or a heart attack. Critical illness insurance can also cover non-medical expenses, such as mortgage or child-care bills. Premiums for critical illness insurance policies are relatively low, which makes the coverage appealing. The policies usually pay out in a lump sum, with the amount depending on the policy purchased. There are different types of critical illness insurance policies: some cover only one illness, like cancer, while others offer coverage of a number of different illnesses. The more coverage offered, the higher the premiums. Before purchasing one of these policies, however, you need to consider the downsides. Reading the fine print on the policy is very important because the policy will only cover certain illnesses, and actual coverage may depend on the severity of those illnesses. For example, even though the policy says it covers cancer, it may only cover aggressive cancer and not a more slow-moving cancer. In addition, critical illness insurance doesn’t offer the same protections that regular health insurance offers under the Affordable Care Act, so you can be denied coverage if you have a pre-existing condition. Critical illness insurance premiums also tend to rise as you get older, and you could be denied coverage once you reach a certain age.  Instead of critical illness insurance, you can consider alternatives. First. you should look at your health insurance to see exactly what it will cover. In addition, a health savings plan in which you contribute pre-tax dollars can be a good way to cover unexpected medical expenses. Disability insurance can also offer protection for lost salary due to illness. For more information about critical illness insurance, click here. For questions about which insurance offers the best protections for your situation or how to financially plan for unexpected illnesses, please call Gayheart Law at (859)...

read more

Can You Visit Nursing Home Residents After They are Vaccinated? — Lexington, KY

Can You Visit Nursing Home Residents After They are Vaccinated? — Lexington, KY

COVID vaccines are starting to roll out to nursing homes across the country, signaling the beginning of the end of the pandemic. Once your loved one has had both doses of the vaccine, you may be able to visit, but precautions are still necessary.  The federal government entered into a partnership with CVS and Walgreens to deliver the vaccines to nursing home residents, who have high priority for being vaccinated, according to the Centers for Disease Control and Prevention (CDC) guidelines. The pharmacy companies began administering vaccines in 12 states in mid-December and will expand to 36 states before year’s end. Both the Pfizer the Moderna vaccines require two shots three or four weeks apart.  Restrictions on nursing home visitors vary from state to state, with some states limiting them and others allowing more visitation. Currently, the CDC recommends that nursing homes allow indoor visitors if the facility has had no COVID cases for 14 days. Once vaccines have been distributed, restrictions may ease further.  According to the New York Times, experts recommend that to be safe, you should wait until two weeks after your loved one gets the second dose of the vaccine before visiting. The safest time to visit would be after all the residents and staff have been vaccinated and you receive the vaccine as well. Even if you and your loved one are vaccinated, you should still wear a mask when visiting. As long as COVID is spreading in the community, mask wearing is still recommended.  Noting that the vast majority of older adults with chronic conditions live at home, long-term care consultant Howard Gleckman asserts that these vulnerable adults along with their caregivers should also be vaccinated as soon as possible.  As states ration their limited initial supplies of the vaccines, Gleckman says, “they should remember the millions of people who are at high risk of severe illness or death from the virus, but who are living at home.” For more information about the vaccine rollout to nursing homes, click here and here. For help with legal questions involving long-term estate planning, call Gayheart Law at (859)...

read more