- If you were married at least 10 years and you are single and age 62 or older, consider claiming Social Security retirement benefits based on your divorced spouse's earnings record. Use this strategy if it would produce a benefit higher than the entitlement based on your own earnings record. If you have been divorced at least two years, you can collect this benefit even though your ex-spouse has not applied.
- If your ex-spouse is deceased and you were married at least ten years, apply for survivor's Social Security benefits at age 60. You must be single to qualify for this benefit or you must have married your present spouse after age 60.
- If you are a divorced parent and you have a child under age 16, apply for Social Security benefits if your divorced wage earner spouse dies, is disabled, or retires and is eligible for Social Security retirement benefits. You will be eligible as long as you were married at least nine months.
- If your ex-spouse is deceased and you were married at least ten years, apply for Medicare at age 65.
Medicaid -Introduction to the Program
Medicaid is a joint federal/ state program providing medical assistance to people meeting certain income and resource limits. It is a health care program covering Prescription drugs, commun-ity based day care, respondent services, in - home care, hospital care & nursing-home care. Medicaid is primary source of funding for long-term custodial care in New York.
Broadly speaking, to be eligible for Medicaid in the community an individual in 1998 may not have more than $3,500 in resources and $604 in monthly income. If the individual has excess monthly income, he or she is required to contribute that excess to cost of care. Certain burial funds/ prepaid funeral arrangements may be allowed in addition to resource level.
Eligibility for medicaid in nursing home
Same resources limits apply. However, all income for an unmarried individual must be paid onto program to help cover the cost of care, except for the cost of health insurance and a $50 personal needs allowance.
$ From - Well Spouse in a nursing home, law provides resource & income protections for spouse at home ("community spouse") is permitted to retain $74,820 or "spousal share," 1/2 of married couples assets up to maximum of $80,760.Not included in calculation of resources is value of home. Additionally, community spouse is allowed a monthly income of $2,019. If community spouse's monthly income is less then $2,019, he / she may draw upon income of nursing- home spouse. In certain circum-stances, community spouse's resource & income levels may be increased by a fair- hearing decision or Court order.
Transfer of Assets
Married individual who require Medicaid may transfer virtually all his or her assets to well spouse, but $ tfr. may be subject to recovery by Medicaid, later. If assets are transferred to persons other than spouse& certain specified individuals, a penalty period is incurred. During that penalty period individual is not eligible for Medicaid nursing home coverage. NOTE: No penalty period for transfer to spouse/ children of assets when applying for Medicaid home care.
Determining Penalty Period
With proper plans maximum period during which an individual may be counted ineligible for Medicaid nursing- home coverage is 36 months for outright transfer & sixty months for transfers to trusts. Penalty periods may be much shorter or, in some cases, avoided entirely!
Record Submission before Acceptance Under Program
When a Medicaid application for nursing-home coverage is made, Medicaid reviews all financial records of applicant & spouse for thirty-six months before month of application to determine whether there were any uncompensated transfers that would incur imposition of penalty period. All uncompensated transfers are added together and total is divided by a number representing the average cost of a nursing home in area where patient is to be institutionalized. Current figure in NYC is $6,521. The result of calculation is the number of months for which the applicant is ineligible for Medicaid coverage in the nursing home. For example, if Mr.Smith. transfers $130,410, to a trust or a nonexempt individual, he will incur a penalty period of 20 months during which time Medicaid will not cover his costs in a nursing home =$130,410/$6,521=20 months.
Transferring a Home
Although individuals home- a house or apartment- is an "exempt" resource for purposes of initial Medicaid eligibility, ultimat-ely it may be subject to a Medicaid demand for reimbursement.
Transfer of home to spouse & certain specified individuals will not trigger a penalty period. However, transfers to any other persons will trigger a penalty period.
Medicaid income only trust is an excellent estate planing tool. This irrevocable trust is funded with assets of a person called a Grantor who retains a life interest funded by invested principal. Grantor has no right to receive any principal distributions. However, trustee whom Grantor appoints is allowed to make gifts of principal to others. In addition to liquid assets such as stocks, bonds & savings accounts, house, cooperative or condominium apartment may also be put into trust with provision that Grantor retain a "life estate," that is, Grantor may continue to live in residence for the remainder of his life.
Medicaid Application for Nursing - Home Coverage
In addition to requiring a thirty-six month retroactive review of applicant's financial history (sixty months when transfers are made to a trust), Medicaid requires extensive documentation to establish eligibility, incl. verification of identity, age, residency, citizenship, marital status, income& resources. Applicant must disclose all relevant financial records including bank statements, savings accounts, stocks and bonds, real estate, etc.. Also required is documentation and explanation for all transfers & transactions of $500 or more. Compliance with this requirement is more complex if substantial transfers were made by applicant. Role of elder-law professional is to participate in process, clarify consequences of these transfers & minimize any possible Medicaid penalty &/or delays.
Medicaid Home Care Application- Form 11q
When the applicant is applying for Medicaid home care assistance, application must be accompanied by finan. history for 1 month for individual applicant .In addition, applic. must include a physician's order designated as form M-Ilq in New York City. Some physicians do not fully understand that an M-IIq which inadequately explains patient's medical needs may account for Medicaid's decision to deny or provide service that is insufficient. The participation of elder-care professional or geriatric social worker who will review the M- 11 q with the physicians may be crucial to applic. success.
Supplemental Needs Trust for Disabled
Disabled persons world has changed. With recent federal & state legislation, "Supplemental Needs Trusts" have become widely used planning tools for persons with disabilities. Such trusts, generally referred to as "SNTs",are intended to enhance lives of disabled persons without jeopardizing eligibility for Medicaid and, &Supplemental Security Income.
Supplemental Needs Trusts
They can also address specific ongoing needs of beneficiary's. E.g.Trustee could be empowered to make payments directly to provider of services that government does not provide like travel, computers, tv, specialty equipped vehicle. If paid directy to benefiary would effect government benefits.
E.g. A disabled person can transfer his assets to a Supple-mental Needs Trust for another disabled person without disqualifying him for Medicaid coverage in nursing home.
E.g. A person who ordinarily would qualify for Medicaid inherits or wins a malpractice award can still qualify for Medicaid, by setting up a "Self Settled" Supplemental Needs Trust" established under recent Federal legislation. The Law says that the State has a right to recover from this trust the total medical assistance provided for her during her lifetime. Note: There are no limits on the amount of income or principal that may be expended on her during her lifetime.
Q & A on Client Inquiries
- Medicaid Planning is Crime?
No, a Federal Judge has forbidden enforcement of this law. Atty. General Janet Reno, informed Congress, she would not enforce the law as is unconstitutional under First Amendment.
- My parent is " spending down" lifetime savings in nursing home, Is there any way to conserve assets?
Yes, an individual who has assets in excess of Medicaid limits generally may protect 50% or more of those assets & still qualify for Medicaid nursing home coverage even if facing immediate placement in a home or is already in facility.
- Transfer of home to a friend
Under most circumstances it is not appropriate to transfer outright ownership of a house or apartment to another person. Such a transfer may incur substantial Medicaid penalty and costly tax results. A desirable alternative, especially if your friend is concerned about your creditors or future creditors, is to transfer home and any remaining assets)into a sheltering trust that, in most instances, will eliminate capital gains tax & liability from creditors, reduce medicaid penalty & avoid probate.
- My child has financial difficulties and I am afraid any asset transfer to him will be taken by creditors.
You can transfer your saving, stocks and bonds to a Medicaid Trust. Assets will be safe from Medicaid while you enjoy the income for you lifetime. In addition, you residence-a house, coop, or condo may also be put into trust, with provision that you retain right to live in residence for remain- der of your lifetime.
- Parent never signed Durable Power of Attorney.
No longer has sufficient capacity. Does that mean she will have to exhaust all of her assets before applying for Medicaid. You have no authority over parents assets. You may petition Court to become Guardian under Article 81. You must show necessity for specific powers you require.Once criteria met statute permits transfers to individuals & asset-protection trusts even when guardian is trust beneficiary.
I have the expertise and experience to lead you through this maze. I am also, the one person who you trust and, who knows all of your family and financial situations and at the same time has all of the expertise to work out the kinks with much less headaches.
2010 Medicare In A Nutshell
Custodial care (type of care that person at home or in nursing home require) is not covered by Medicare or Medigap policies. The only home care or nursing home care that Medicare covers is skilled-nursing care or skilled-rehabilitation care. Long-term care insurance or Medicaid is alternative sources for paying for custodial-care services.
Medicare program is a system of health insurance for aged and disabled individuals. It consists of two basic parts: Part A provides coverage for costs incurred by eligible beneficiaries for inpatient hospital care; Inpatient care in a skilled nursing facility following a hospital stay, home health care and hospice services. Part B is a voluntary program in which eligible beneficiaries who pay a monthly premium are entitled to reimbursement for physician and other medical services and supplies.
Primary Medicare eligibility is linked to eligibility for Social Security retirement and disability benefits. Disabled persons and disabled widows/ widowers under age 65 may also be eligible for Medicare. Some people, who are 65 years of age or older, but not otherwise eligible, may purchase insurance when applying for Social Security.
The initial enrollment period begins three months prior to the month of your 65th.birthday and continues three months after that. There are substantial penalties for late enrollment. A special period is available to the working aged and their spouses who delay enrollment because of primary employer based insurance
Benefits-Medicare Part A
Inpatient Hospital Coverage:
Hospital Insurance (Part A) will pay for all medically necessary inpatient hospital care for the first sixty days minus a deductible for each benefit period. For remaining days a beneficiary must pay substantial co-payments, which may be covered under a Medigap policy (see below).Major in-hospital services covered by Medicare Part A include a semiprivate room, all meals, special-care units including intensive-care unit, coronary-care unit, regular nursing services and drugs furnished by hospital during a patient'0s stay.
Skilled Nursing Facility Care: Medicare will also pay for up to 100 days in a skilled-nursing facility. First 20 covered, but for days 21 through 100 a daily co-payment is required. Patient must have been hospitalized for 3 days and be admitted to facility generally, within thirty days after leaving the hospital.
Home Health Care: Medicare also provides home health care services which can continue for as long as the beneficiary is under a physician's plan of care; requires skilled nursing care and is essentially confined to home. Physical, occupational, speech therapy and the services of a home-health aide are available. A prior hospital stay is not required.
Hospice Care: Medicare's hospice program includes both home care and inpatient care, when needed, and a variety of services not otherwise provided by Medicare. To be eligible, a Medicare beneficiary must be certified by a physician as terminally ill with a life expectancy of approximately six months or less. Those who choose hospice care receive non-curative medical and support services for their terminal illness. Regular Medicare continues to pay, for medical treatments not related to the terminal illness.
Benefits - Medicare Part B
Medicare insurance (Part B) covers a variety of medical services of particular importance to Medicare beneficiaries, including physician services in and out of hospital, durable medical equipment, outpatient hospital services, physical occupational, speech therapy and ambulance transportation. Part B coverage is voluntary. Most Medicare beneficiaries decide to enroll in program with their monthly premiums and an annual deductible amount which must be paid before Medicare benefits are reimbursed. Medicare pays 80% of the approved charge for services and beneficiary is responsible for the 20% co-payment. The 80% payment usually amounts to 60% of actual medical bill.
Excluded Services Under Part A and Part B
Services not covered by Medicare Part B are most outpatient prescription drugs which do not require administration by a physician, routine physical checkups, immunization with some exceptions, eyeglasses or contract lenses, most dental care and hearing aids. Generally, Medicare will not pay for hospital or medical services abroad or physician services on ship cruises beyond U.S. territorial waters.
There is cap on what doctors charge Medicare patients for each service. In NY, doctors may not charge more than 5% above Medicare approved rate for most services.
Patients generally supplement their insurance with Medigap policies that have various coveragea?™s. Plan A is a policy with core benefits that are included in the nine other plans. For more info. Contact US Dept. of Health 7500 Security Blvd.Baltimore, Md. 21244-1850or 800-772-1213.