Testifying at the State House
August 5, 2013
Last week, I headed to the State House to once again testify on bills that could plug some holes in the MassHealth nursing home payment system and make things a bit easier for families caring for frail elders.
The shorthand for this bill is the “transfer of assets” bill. It comes down to this: As you probably know, should you need nursing home some day, and if you need MassHealth to pay for it, MassHealth understandably looks through five years of bank statements to see if you’ve given any large sums away in the last five years. After all, it would not be fair if we could just give our money away and then ask our fellow taxpayers to foot our nursing home bills.
But the problem lies in abiding by this principle too strictly. The MassHealth regulations (based on federal law) actually state that you cannot transfer assets within the last five years with the intent of qualifying for MassHealth. The MassHealth regulations indicate that applications should be approved where the assets “were transferred exclusively for a purpose other than to qualify for MassHealth.” The problem is, MassHealth is not following its own regulations.
Quite frequently, nursing home placement is the result of a sudden decline, or an unexpected illness. It is fairly common for a healthy, active elder to do what she has always done – birthday gifts to family, donations to her church, help out a child divorcing or at risk of foreclosure – and a few years later be faced with a sudden turn of events and need to move to the nursing home. These elders should not be punished for not only not knowing about the five-year “look-back” rule, but worse – for being healthy and loving their families.
What happens to you if you are one of these unlucky people? Let’s say you were in good health, your child’s home was in foreclosure, you paid off her debt, and then let’s say four years later, out of the blue, your health fails and you need nursing home care. Well, you might pay down most of your remaining assets to the nursing home, and once you run out of money, you apply for MassHealth assistance. If you run out of money before you get to the five-year mark from making that gift, things are going to be difficult.
Imagine this: You are in the nursing home, you have spent all your savings, and you have no choice but to ask for MassHealth to pay your nursing home bill. It is only at this point – when you have no more money – that they impose the disqualification period that resulted from the gift. Let’s say you gave your kid $33,000 – that amounts to four months of disqualification. So you are in the nursing home, you have no money, and MassHealth won’t start paying for another four months. The nursing home isn’t paid to care for you, so now what? Is it fair that the nursing home should provide 24/7 room, board, and medical attention without being paid? They can’t operate that way. They try to evict you for nonpayment. And then things get ugly. You might bounce from hospital to hospital, or you might end up in your last choice of nursing homes. Not pretty.
The “transfer of assets bill” would make it clear to MassHealth caseworkers (the folks that review and then approve or deny your nursing home application) that transfers in the last five years shall not result in denials if the transfers were made for certain various reasons. These are reasons that you might categorize under “living my life” or “taking care of my family,” such as a pattern of small gifts (monthly donations to church or annual birthday checks); helping a relative in financial crisis, foreclosure, or with medical care; or, whatever the reason for the transfer, at the time of the transfer, there was no reason to think you would need MassHealth in the next five years.
The “transfer of assets” bill is actually two identical bills – one filed in the House by Representative John Fernandes (H1021) and one filed in the Senate by Senator Katherine Clark (S503). Please call your state representative and senator and ask them to support these bills. To find your rep and senator and their contact information, click here. And thank you.
Department of Public Health Survey on Health Needs for People with Disabilities
May 20, 2013
Another Good Reason to Buy Long-Term Care Insurance
November 1, 2012
I talk to a lot of my clients about buying long-term care insurance (LTCI). Many people come to my office asking about “nursing home planning” – how to make sure they don’t use up all of their savings if they end up in a nursing home. And my response is always, “Your nursing home planning is to stay out of a nursing home.” And one key piece to keeping people in their homes with care, and out of the nursing home, is to have LTCI.
After seven long years of advocacy by MassNAELA (that’s the Massachusetts Chapter of the National Academy of Elder Law Attorneys), yesterday Governor Patrick signed a bill that makes LTCI an even better bet for seniors.
Until now, if seniors were lucky enough to have LTCI, they could of course use the policy to pay for care in their homes. But – they’ve had to keep a careful eye on how much of the policy they were using up at home. When home care is no longer medically viable, and the senior needs to go to the nursing home, then the LTCI would protect the value of their home from the cost of nursing home care – but only if they entered the nursing home with a certain amount of money still in the policy. This had the effect of either (1) forcing seniors to leave their homes before they wanted to, or (2) staying at home longer and using up the policy benefits, finally going to nursing home, and losing the house to the cost of nursing home care.
Now things will be different – and better. If a senior has a LTCI policy that meets MassHealth standards at the time of purchase, then she can use as much of that policy as she wants to stay in her own home for as long as she safely can. Then, if she ever needs to move to a nursing home, no matter how little benefit is left in the policy, her home will still be sheltered from the cost of nursing home care. This will help seniors stay at home longer, and will keep MassHealth’s costs down. A win-win for seniors and MassHealth.
Good News on Pooled Trusts
August 9, 2012
When a single person is entering a nursing home, and if she needs MassHealth to assist her with paying for that, then she needs to bring her assets down to $2,000. Elder law attorneys often recommend setting aside a “cushion” in a pooled trust – since $2,000 amounts to bubkes, really. Having a cushion set aside in the pooled trust provides the elder with the opportunity to buy things that MassHealth doesn’t provide, like hearing aides, a better bed, companion care, extra therapies, etc.
In the last few years, states across the county have been trying to shut down this opportunty for seniors, saying that anyone over 65 can’t transfer assets to the pooled trust and then expect MassHealth to help with the nursing home bill. Well, we can now breathe a little easier – the federal court that covers Pennsylvania has ruled that in fact, anyone 65 and over can establish a pooled trust account, and the states cannot say otherwise. This Circuit Court’s opinion is not binding on Massachusetts, but there is a strong tradition of federal courts in the same area of the country taking cues from each other.
To date, MassHealth has still permitted elders to transfer funds to pooled trusts so that they can have cushions while in the nursing home. From time to time MassHealth talks about prohibiting that practice. Now it looks even less likely that they can stop elders from using pooled trusts. That is good news for single seniors who need nursing home care and want to hold on to a little something so that they can pay for things not provided by MassHealth.
Is Your Spouse Moving to a Nursing Home? Are You Scared of Using up Your Savings on the Nursing Home Bill?
August 8, 2012
When one member of a couple needs nursing home care, and if you are asking MassHealth to assist with the monthly bill, then the healthy spouse at home may keep only $113,640 in liquid assets, in addition to her home. For a younger spouse with many years ahead of her, reducing her liquid assets to only $113,640 can be a very scary proposition.
One option for the healthy spouse to hold onto more of her savings is to convert the liquid into real estate, namely, to make improvements to her home. Now is the time to make the repairs you’ve been putting off – new heating system, new roof, etc. Think about what modifications will allow you to stay in your home for as long as possible, like widening doorways and remodeling a bathroom to be easier to use if you have less mobility. And if you are not planning to stay in your home for much longer, then think about what improvements will help you sell your home.
Another option for helping a healthy spouse hold on to more of her savings is an annuity. MassHealth permits an at-home spouse to convert her excess assets to an annuity that meets very particular requirements. You absolutely must work with an elder law attorney if you want an annuity for MassHealth purposes. Most financial advisors are not familiar with the MassHealth annuity requirements. And those advisors that do know the requirements don’t want the liability of advising you themselves.
When one member of a couple is entering a nursing home, it is critical for the at-home spouse to meet with an elder law attorney to understand her options. Adjusting to living alone is hard enough. You shouldn’t also have to learn how to live with the fear of running out of money.
Heard in the Office: “I Don’t Want the Nursing Home to Take My House.”
August 6, 2012
I hear this a lot. Let’s be clear on the very basics. If you’ve watched friends go to a nursing home and “lose the house,” it’s not the nursing home forcing them to sell. Like all medical providers, nursing homes need to be paid.
Your Medicare and supplemental health insurance policy (ex. MediGap) will pay for up to 100 days – after that, you are on your own. At that point, some people have the ability to privately pay, and they use their savings, and perhaps even sell the home to pay the monthly bill. Other people don’t have savings or even a home to convert, and they ask the state to pay the bill (that’s MassHealth, also called Medicaid).
And there is a third category of folks, where there is a spouse living at home who simply can’t afford to use her savings to pay $10,000 – $12,000 per month to the nursing home if she is going to be able to continue supporting herself at home. She may do some planning so she can ask MassHealth to pay for her spouse’s nursing home care while also being able to retain enough of her assets to support herself at home without living in fear of poverty.
If you are living at home and your spouse needs nursing home care, contact our office so we can help you protect yourself while also making sure your spouse receives the medical care he needs.
Testifying at the State House
September 7, 2011
Earlier this summer, I made the big trek to Boston, all the way to the State House. (We are so lucky on the South Shore, we get to take a boat to Boston!) Along with some colleagues, I testified on some bills that we have before the legislature. “We” being the Massachusetts chapter of the National Academy of Elder Law Attorneys (MassNAELA).
You may already know that MassHealth has a 5-year “lookback.” That means that if you ask MassHealth to pay your nursing home bill, they look back over the last five years to see if you have made any transfers, or gifts. If you have, then MassHealth will deny your application for benefits, the rationale being that you should have known that you would need a nursing home within five years and would need that money.
Technically, the law instructs MassHealth to deny applications where the applicant gave her money away with the “intent” of qualifying for MassHealth. But what about the situations where people are healthy, don’t anticipate medical deterioration in the near future, and are following the natural instinct to help their kids, for example, with college, a wedding, or tough times?
I was asked to testify on a case I have currently, which I can’t describe much because of client confidentiality. Let’s just say that Mrs. Beautiful has lived a very difficult life, financially and emotionally. About three years ago, she won a settlement in a class-action lawsuit, and even though she had so little money of her own, she immediately gave it to her grandchildren for college. She was determined that they would have a better shot at life than she had. At that time, her health was fine, with no hint of an upcoming turn.
About six months ago, her health suddenly declined and her mind slipped. Staying at home didn’t work, and she moved to a nursing home. She and her husband have very little money, so they applied for MassHealth. They of course denied her application, since she had given money to her grandchildren. Despite what the law says, MassHealth didn’t bother to consider whether Mrs. Beautiful gave that money away for the purpose of getting out of paying her future nursing home bill, or if she did it driven by an instinct to do right by her grandchildren, during a time when her health was fine.
MassNAELA’s bill would clarify the law and create a more precise process by which MassHealth must determine whether an applicant transferred assets with the intent of qualifying for MassHealth or whether they made gifts to their family during times of good health, for all the right reasons that families help each other.
What Goes into a Caregiver Contract?
September 21, 2009
Paying Your Children to Care for You? Put it in Writing.
August 30, 2009
Always Keep Time & Expense Records When Helping Another
August 6, 2009
So many children, nieces and nephews, and good neighbors pitch in to do heavy lifting for an aging or disabled family member or friend. You may be running errands, cleaning out a basement, doing weekly grocery trips. We do these things on a volunteer basis, usually receiving just reimbursement for purchases made. And when the hours pile up – like cleaning out a house or overseeing home remodeling – elders often insist on paying their helpers for their time.
If you are doing this sort of work for an elder or disabled person, it is imperative that the person you are helping (or you yourself, if she can’t), keep good records of expenses and time spent.
While this may feel wrong to you – afterall, you are doing this work out of kindness, it’s not a business arrangement – a lack of records can spell big trouble for the elder or disabled person later. If they will ever be turning to MassHealth (Medicaid) for care, whether at home, assisted living, or in a nursing home, MassHealth will examine the last 5 years of the applicant’s bank records. She will need to explain – and document – why she was paying you.
Without accurate records and receipts, MassHealth will likely reject the elder’s application. At that point, the only way for her to get the care she needs from MassHealth will be for you to return all the funds she paid you.
While it may feel awkward, do yourself and the person you are helping a favor and keep good time records and all receipts. And carry on with your good work.