January 13, 2016
1. MEDICARE AND ITS LIMITATIONS
(More coverage information available at medicare.gov)
a. Medicare Part A covers care in a skilled nursing facility, but only under certain conditions and only up to 100 days.
b. In order for Medicare Part A to cover skilled nursing care, you must have:
i. A “qualifying hospital stay” (you have been a hospital inpatient for at least three days in a row, including the day you were admitted but not including the day of your discharge)
ii. Your doctor states you need daily skilled care given by or under the supervision of skilled nursing or rehabilitation staff.
iii. The services you need are for a medical condition that is hospital‐related or that started while you were getting care in the skilled nursing facility for a hospitalrelated condition
c. Benefit Period
i. Your break in skilled care must last for sixty days in order to start a new benefit period and receive up 100 days skilled nursing coverage.
ii. What You Pay for each benefit period
1. Days 1‐20 $0
2. Days 21‐100 ‐ $148.00 coinsurance (supplemental insurance sometimescovers this copay)
3. After Day 100, patient is responsible for all costs.
2. MEDICAID INTRODUCTION
a. Medicaid is a federal/state program that was established in 1965 by Title XIX of the Social Security Act. 42 U.S.C. §§ et seq.
b. Both the federal government and states who elect to participate in the program share the cost of Medicaid. States must comply with federal requirements in order to receive federal funding. 42 U.S.C. § 1396(a)
c. Delaware is a “Section 1634 state.” Delaware has an agreement with SSA that SSA will make Medicaid eligibility determinations for anyone receiving SSI benefits and/or federally administered State Supplementary payments (SSPs). POMS SI 01715.010.3
d. A Medicaid applicant must be both medically (in need of skilled or intermediate level care as defined by Medicaid criteria) and financially eligible in order to receive coverage.
e. Long‐term care Medicaid covers nursing home, assisted living and home‐based services for those determined to be medically and financially eligible.
3. RULES FOR FINANCIAL ELIGIBILITY
a. INCOME
i. For 2014, Delaware Medicaid has a gross income limit of $1,823.00.*Check Your State for Specific Limits*
Medicaid Basics
ii. If a Medicaid applicant is over the income limit, they must execute and fund a Miller Trust.
4. MILLER TRUST
a. Must only contain income.
b. Applicant may not use resources to establish or add to the trust.
c. Must be irrevocable.
d. Must state that upon the death of the Medicaid recipient the State will receive any funds remaining in the trust up to an amount equal to the total medical assistance paid on behalf of the individual.
5. RESOURCES
a. A Medicaid applicant cannot have more than $2,000.00 in resources.
b. “If an individual has the right, authority or power to liquidate the property or his or her share of property, it is considered a resource. In order to be considered a resource, the individual must have: some form of ownership interest in the property and a legal right to access the property.” DE Medicaid Manual 20300.3
6. RESOURCE EXCLUSIONS
a. Primary Residence
i. Intent to Return Home.
1. If a Medicaid applicant expresses an intent to return home, the home may be excluded as a resource.
b. One car. If there is more than one car, the more valuable car is excluded.
c. Life insurance.
i. Life insurance with total face value of $1,500 or less is excluded, regardless of cash surrender value.
ii. Life insurance with no cash surrender value is excluded.
d. Pre‐paid burial contract, not to exceed a principal sum of $15,000.00. Must be irrevocable. Medicaid will require a goods and services list and proof of purchase.
e. Qualified Plan of Community Spouse.
7. TRANSFERS OF ASSETS
a. A transfer of assets occurs when an institutionalized individual, or the individual’s spouse, has sold, given away or otherwise transferred an asset.
b. Lookback Period is five years from the time that an individual is institutionalized and has applied for medical assistance.
c. Penalty Period is a period of ineligibility for long‐term care Medicaid services that is imposed when an individual makes a transfer of assets for less than fair market value.
i. The penalty period is equal to the total uncompensated value of all assets transferred by the individual or spouse during the lookback period divided by the penalty divisor (approximately equal to the daily cost of a private patient receiving nursing facility services at the time of application). Delaware 2014 Daily Penalty Divisor=241.00
ii. The penalty period begins the LATER OF the month during which assets have been transferred OR the date on which the individual is eligible for medical assistance under the State plan and is receiving institutional level of care services (based on an approved application for such services) that, were it not for the imposition of the penalty period, would be covered by Medicaid.
iii. Return of Assets. The penalty period can be shortened by returning assets.
iv. Exceptions to Transfers of Assets
1. Residence. The transfer of assets does not apply for transfer of a residence to:
a. A spouse
b. A child under 21
c. A child who is blind or disabled, as defined by the SSI program
d. A sibling who has an equity interest in the home and who has resided in the home for at least one year immediately before the date the individual becomes institutionalized
e. A child who was residing in the home for at least two years immediately before the date the individual became institutionalized, and who provided care to that individual which permitted the individual to reside at home rather than in an institution
2. Any Asset. The transfer provisions do not apply to any asset transferred:
a. To the individual’s spouse
b. To the individual’s child who is blind or totally and permanently disabled
c. To a self‐settled special needs trust
d. To a pooled trust
3. Rebuttable Presumption
a. If assets are transferred within five years of application, Medicaid will apply a penalty.
v. If Medicaid is going to apply a penalty, they are obligated to give written notice to the applicant that it has been determined that an asset has been transferred for less than fair market value and that the amount will be counted for eligibility purposes unless the individual wishes to rebut the presumption.
vi. If an applicant wishes to rebut the presumption, the burden of proof rests with the applicant. The rebuttal must be received by the Medicaid office within 15 days of the date of the notice and must include the following information:
1. Applicant’s purposes for transferring the asset
2. Applicant’s attempt to dispose of the asset at fmv
3. Applicant’s reason for accepting less than fmv
4. Applicant’s means of, or plans for, supporting himself/herself after the transfer
5. Applicant’s relationship, if any, to the person to whom the asset was transferred
vii. It is insufficient to merely state that the individual intended to transfer the asset for a purpose other than qualifying for Medicaid.
viii. Rebuttal determined on a case by case basis, but the following factors may rebut the presumption:
1. Sudden onset of disability after asset transfer
2. Unexpected loss of income or resources after asset transfer
8. TREATMENT OF INCOME AND RESOURCES OF COUPLES
a. Medicaid law contains spousal impoverishment provisions that are intended to prevent the spouse living in the community (“the community spouse”) from becoming impoverished because their spouse (“the institutionalized spouse”) is in a nursing home.
b. Except for certain exemptions, Medicaid counts all assets of husband and wife. Medicaid counts the resources as of the first continuous period of institutionalization.
9. INCOME OF THE COMMUNITY SPOUSE
a. Minimum Monthly Maintenance Needs Allowance
i. The minimum amount of income that a community spouse is permitted to keep, ($1,938.75 as of 2014)
b. The community spouse has no income limit.
10. COMMUNITY SPOUSE RESOURCE ALLOWANCE
a. The community spouse can keep the greater of:
i. $25,000.00 OR
ii. ½ the value of the couple’s combined resources, not to exceed $117,240.00