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.
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.
Looking at Continuing Care Retirement Communities? Look Closely.
December 3, 2010
There are a lot of benefits to Continuing Care Retirement Communities (CCRC’s), also called “Buy-In’s.” These are the places where you put down a substantial sum (maybe $250,000 or more) as an entrance fee, and you plan to stay there for life – they have independent apartments, various levels of assisted living, and skilled nursing (nursing home), all on campus. There is definitely something appealing about the promise of being cared for for life.
But will they really care for you for life? There are some big questions right now about the nursing home units at CCRC’s. For example, when describing the nursing home to you, a potential customer, the sales staff will explain that if you run out of money, they will help you apply for Medicaid. Well, as it turns out, sometimes the CCRC makes you spend down even further than the Medicaid rules do.
For example, for a married couple, if one spouse needs nursing home but the other is still in the community (ex. in her own apartment or in the assisted living), MassHealth rules permit the community spouse to keep about $110,000 to live on. But guess what – before letting the husband move into a MassHealth nursing home bed, the CCRC might make the wife spend her own money down even further than the $110,000, maybe allowing her to keep only $50,000 for herself. And what did they have her spend it on? The husband’s private pay bed in the CCRC nursing home. And how much longer can she last in the community with only $50,000 to her name?
The sales team might also tell you that if a couple really runs out of money, there is a benevolent fund that will help you pay your monthly fees. I’d be a lot more comfortable moving into a CCRC if I saw the balance sheet for that benevolent fund – is there really enough in it for all the residents who might need help? And do they ever really expend from the benevolent fund?
Before committing to a CCRC, do your research. Dig around to make sure that what the sales staff is telling you is true. Two sources of hands-on experience with the nursing home units are going to be (1) local families who have been through the nursing home, and (2) local elder law attorneys who have helped clients navigate the CCRC nursing home experience.
Single Elders Who Will Soon Need MassHealth Nursing Home: Act Fast to Set Aside a Cushion
December 4, 2009
To qualify for MassHealth to pay for nursing home care, a single elder can have only $2,000 in his name. A big problem with allowing such a small reserve fund is that MassHealth doesn’t cover many needed services and medical items – like hearing aids, routine dental care, and eye glasses – and the elder is left with no way to pay for those items himself.
For anyone who will need MassHealth to pay for nursing home care, it is usually a good idea to try to set aside some funds to serve as a cushion to provide those necessary items that MassHealth won’t cover. For single elders, the way to set aside a reserve fund is usually to deposit some amount of money with a “pooled trust.” A pooled trust is a trust fund, operated by a nonprofit organization, that pools together the deposits of its many elder and disabled members in order to streamline costs and maximize interest earned. The staff at the pooled trust keeps a separate running balance of each individual’s deposits. We have four pooled trusts in Massachusetts.
Until now, MassHealth has allowed elders to set aside some funds in a pooled trust to serve as a cushion for those uncovered “extras” that will inevitably be needed during a nursing home stay. MassHealth has permitted this transfer without imposing the usual transfer penalty.
But we just learned that this month, MassHealth plans to close this door and will no longer allow elders to set aside reserve funds in this manner. Therefore, if you are an elder or are caring for an elder who you think will need MassHealth nursing home care soon – whether that be in the next few months or the next year – you should speak with an elder law attorney this week about setting up a pooled trust account. In order to preserve a cushion to sustain a person through a nursing home stay, all of the paperwork for enrolling in the pooled trust must be completed before MassHealth changes the regulation, and they intend to make the change some time this month.
If someone you love will need MassHealth to pay for nursing home care soon, and they would like to set aside a reserve fund to pay for those items and services that MassHealth doesn’t cover, then you need to speak with an elder law attorney now. Time is of the essence.
What Happens to My Special Needs Child’s Health Care Coverage When She Turns 18?
February 6, 2009
The idea of a special needs kid turning 18 can be scary – that is when she is legally an adult and things start to change. In another post I will address her legal decision-making power. This post looks at health care coverage.
If your child is on your private health insurance policy (i.e., the family plan you have through your employer), the good news is that she should be covered through age 25, so long as she is still your “dependent,” meaning that she receives over one half of her financial support from you. After 25, if she is not employed, you will probably need to look at MassHealth.
On the other hand, if your child has been on MassHealth as a minor, her current coverage will end somewhere between 18 – 22, depending on which program she has been enrolled in. The good news here is that there are several MassHealth programs that she can switch over to as an adult.
A word of warning – there are many different MassHealth programs, and they each of different enrollment criteria. The enrollment process itself is long, tedious, and frustrating. (If you’ve dealt with MassHealth in the past, you already know this.) So if you are planning to enroll your child in MassHealth as an adult, get started on that process early. Record-keeping is critical. Keep all receipts related to medical care and medical purchases (doctor’s visits, prescriptions, equipment, even the little things from the pharmacy).
The Boston Children’s Hospital and the Boston Bar Association wrote a good guide on this topic, see chapter 7 here.
MassHealth (Medicaid) Programs for Kids
February 4, 2009
Some children don’t have private health insurance coverage through their parents, as a matter of fact, lots of kids – one in four Massachusetts children is on MassHealth (Medicaid).
Applying for MassHealth is very confusing – there are several programs, they each have different enrollment criteria, and they provide different levels of coverage. Check out this guide, produced by Children’s Hospital and the Boston Bar Association – chapter 3. Scroll down to page 10 for a good overview of several different MassHealth programs. The guide is written for parents of kids with mental health issues, but the insurance chapter applies to all kids.
Being Paid to Care for Your Parents
January 28, 2009
As their parents have needed increased hands-on care and errand-running, many “Boomers” have been squeezed trying to juggle caring for their parents and performing well at work. Our current economy has produced a mixed blessing for some – lost jobs means time to address their parents’ needs, but without economic security.
One solution is a “caregiver contract.” This is a written agreement between the parents and the adult children, laying out tasks the child will perform and a rate of pay. Set up along with worker’s compensation and the usual payroll deductions, this provides an income stream to the caregiver while giving the parent what most elders want – being cared for by her own family. Only an elder law attorney familiar with the ever-changing rules of Medicaid should draft a caregiver contract, so that it will protect the elder in the event she needs nursing home care in the future. If not done correctly, a caregiving arrangement can result in a later denial of MassHealth nursing home benefits.
Rising Unemployment Means Rising Uninsured
January 12, 2009
Rising numbers of unemployment inevitably lead to a significant number of people losing their employer sponsored health insurance. Where do these people turn for insurance? States provide Medicaid for people who meet their income and asset requirements. Medicaid is much more generous with children, even the children of parents who themselves have too much money or assets to qualify. So hopefully most kids will still have coverage. But what about the adults?
The Kaiser Family Foundation, a nonprofit that does extensive nonpartisan, high quality research into health care finance matters, including Medicare, Medicaid, and private insurance, recently released a daunting report. Their figures estimate in 2009, 5.9 people will lose their employer coverage, Medicaid and SCHIP (for kids) will pick up 2.4 million, and 2.6 million people will remain uninsured. State governments provide some assistance to hospitals who treat uninsured, but of course with declining tax revenues, there will be less funding available for such reimbursement (the “compensated care pool.”)
Where will the funding come from to cover the 2.4 million new MassHealth and SCHIP enrollees? And what about increasing funding to cover more of the people left uninsured? Medicaid (and Medicare) already make up unwieldy percentages of state and federal budgets. President Obama and his team have announced that they will take on these programs. It will be a difficult but very worthy project. I expect that NAELA, the organization supporting the nation’s elder law and disability law attorneys, will provide leadership on this issue. Our organization has many individuals well schooled in these issues and passionate about redesigning the health care system to make it serve more people more effectively.