New York Community Medicaid Changes
In April 2020, amidst the beginning of the COVID-19 pandemic the New York State Legislature passed the 2020-2021 budget. Every year the governor threatens to slash the Medicaid budget and considering the dire fiscal straits, it is not surprising that significant changes to Medicaid were passed. These changes will adversely affect Medicaid long-term care eligibility. Thankfully, some endangered provisions, such as spousal refusal, remain intact. There are no immediate changes to nursing home care. However, elder law attorneys are concerned that senior medicaid applicant’s may no longer be able to get the long term care services they need.
30 month “look-back” for community home care services
Beginning October 1, 2020, the new Medicaid rules require a full review of a medicaid applicant’s finances extending back two and a half years when applying for Medicaid home healthcare services. Historically, there has been no look-back period, meaning we could transfer assets one month and qualify the prospective applicant the very next month. The legislature has indicated a grace period until January 1, 2021 – however this will likely require a 3 month look-back period between October and December 31st of this year. This means that those individuals contemplating long term care services must plan early or endure significant penalty periods where they will be ineligible or have to pay the private pay rate.
What is a penalty period?
A penalty period is amount of time that an applicant is ineligible for Medicaid home care benefits and must pay privately for them. The law does not indicate the rate that will be used to calculate the penalty period – but it is likely to be the same rate currently used for chronic Medicaid (nursing home care, which requires a 5 year look-back).
If so, Medicaid (Human Resources Administration in NYC) will issue a one-month penalty for every $12,844.00 (every region has a slightly different rate) transferred for less than fair market value. This means that Medicaid will not pay for services during that time period. For example, if $100,000 is transferred/gifted (to a child or an irrevocable trust), a penalty period of approximately 7.8 months is imposed.
How else with this affect prospective Medicaid applicants?
This look-back period will result in added expense to clients. Attorneys will have to review an additional 29 months of financial documents. Additionally, applicants will be burdened with gathering these documents, extending the time period they will be left without the care they urgently need. Medicaid laws require that an application be processed within 45 days – but it is unclear if this added documentation will further delay approvals.
How will this effect existing Medicaid recipients?
Every year a Medicaid recipient must recertify to continue receiving benefits. It is practitioners hope that their eligibility will continue despite past financial transfers within the new lookback period. It is unconscionable to think that such current Medicaid recipients would lose services because of transfers made that cannot be reversed.
Stricter Requirements for Eligibility
The Budget also added a heightened criterion for Medicaid eligibility. Starting in October, in order to be eligible, individuals must be determined to require at least limited assistance with two or more activities of daily living (ADLs), which will no longer include housekeeping activities or shopping. Qualifying ADLs include bathing, grooming, eating, walking, transferring (from bed to chair, e.g.), and toileting.
There is an exception for individuals with a dementia or Alzheimer’s diagnosis, who will be considered eligible if determined they need supervision with one or more ADLs.
Independent Assessors will determine level of care
By October 1, 2022, the local department of Social Services (HRA in NYC) and the Managed Long Term Care (MLTC) providers will no longer conduct applicants’ initial assessments to determine level of care. Instead, this function will belong to an independent assessor contracted through the Department of Health (DOH).
How will the changes affect eligibility for Medicaid?
It is unclear whether this will negatively impact a medicaid applicant’s care once the DOH makes the assessment guidelines and chooses the assessor. There is concern that these independents will not be well versed in the needs of seniors and disabled individuals because they do not themselves provide such health care.
If Medicaid long-term care is a future consideration, consider consulting an estate planning attorney to start the planning earlier to account for the extended look back period. I am happy to offer a free family meeting to discuss how to put into effect a plan to “Age in Place.”
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