We can help you make a Medicaid application at the DCBS office in the county where you live!
One of the most difficult times a person will face is the placement of a loved one in a nursing home. This is often not only an emotional hurdle, but a financial one as well. Many people work hard and save for their retirement for years, only to deplete their savings paying for their long-term care or the care of a loved one.
Too often people do not fully understand the complicated rules of Medicaid, and they rely too heavily on advice from family and friends. Although well-intended, this misinformation can lead to the denial of benefits or penalties that could end up costing you your life’s savings. We provide competent guidance and planning so these pitfalls can be avoided, assuring eligibility and alleviating financial stress. Working with an experienced Kentucky Medicaid lawyer can help you avoid giving away your assets too early, ignoring important safe harbors created by Congress, or applying too early or too late.
It is never too early or too late to make effective plans for Medicaid benefits. Whether your loved one has already moved to a nursing home, or if you don’t anticipate going for years, we can help you take the important steps to minimize the risks, maximize the savings and protect your assets. Learn more about the options you have available by contacting us to schedule your free initial consultation.
What is Medicaid?
Medicaid is a jointly funded, Federal-State health insurance program for low-income and needy people. It covers children, the aged, blind, and/or disabled and other people who are eligible to receive federally assisted income maintenance payments. See 42 USCA §1396 et seq.
What are Medicaid Nursing Facility (NF) Services?
Nursing facility (NF) services included in per diem rate are room and board, dietary services, nutritional supplements, social services, activities, respiratory therapy and supplies, nursing services, the use of equipment and facilities, medical and surgical supplies, prosthetic devices, laundry services, drugs ordered by the physician and personal items routinely provided by the facility. Other services, if medically necessary and if ordered by the physician, are x-rays, physical therapy, speech therapy, occupational therapy, laboratory services, oxygen and related oxygen supplies may be billed separately from the per diem rate.
Who is eligible for Nursing Facility Services?
You may be eligible for nursing facility services if:
- You are age sixty-five (65) years or older, blind or disabled or are currently Medicaid eligible.
- You reside in a facility that participates in the Kentucky Medicaid Program and are placed in a Medicaid certified bed.
- You require and meet the nursing facility level of care criteria giving consideration to the medical diagnosis, age-related dependencies, care needs, services and health personnel required to meet those needs and the feasibility of meeting the needs through alternative or non-institutional services. See 907 KAR 1:022.
- You meet the “Resource” and “Income” eligibility requirements.
- For the specific requirements contained within the Kentucky Administrative Regulations see 907 KAR 1:011.
What are Resources?
Resources are cash money and any other personal property or real property that you own, may convert to cash and could use for support and maintenance. Resources include checking and savings accounts, stock or bonds, certificates of deposit, automobiles, land, buildings, burial reserves, life insurance policies, annuities, trusts and more. The specific resource standards for Medicaid can be found at 907 KAR 1:645.
Medicaid does not consider some resources in determining Medicaid eligibility. These resources include the home for the first six (6) months of institutionalization or if a spouse or dependent family member lives in the home, household goods and personal effects, the first $1,500 of a burial reserve or a life insurance policy, one automobile used for work, medical treatment or by the community spouse, burial spaces and plots, life estate interest and IRA’s, Keoghs, retirement funds and other tax deferred assets (until accessed). The specific resource exclusions can be found at 907 KAR 1:645 §2
Your resources must be within Medicaid resource guidelines. The resource limits vary if you are married and they do count your spouse’s resources.
- Single Person $2,000 Resource Limit
- Married Couple (both institutionalized) $4,000 Resource Limit
- Married Couple (with a community spouse) Min.- $23,184; Max. – $115,920
Medicaid does NOT recognize prenuptial agreements, therefore include all resources in a prenuptial agreement in the total combined resources for the applicant when comparing to the above limits.
Do not count the current month’s income as both income and a re-source. EXAMPLE: If income for the current month is deposited in a bank account, deduct that amount from the account balance to determine actual resources.
What is a Resource Assessment?
We can help you in requesting the Department for Community Based Services (DCBS) to make an assessment of your combined countable resources. You do not have to apply for Medicaid to get a resource assessment. The resource assessment involves documenting and verifying all countable resources owned by you and your spouse at the time of the most recent nursing facility admission. The assessment compares the combined countable resources to the current Medicaid limits to determine if you meet Medicaid resource guidelines. The assessment also sets the spousal share or the amount of resources your spouse may keep if you apply and are approved for Medicaid.
What are Transferred Resources?
If you or your spouse transfers resources, you may not be able to get Medicaid nursing facility services. Transferred resources are cash, liquid assets, personal property or real property, which are voluntarily transferred, sold, given away or otherwise disposed of for less than fair market value. If DCBS determines there was a transfer of resources, a penalty period will be calculated and will begin the month the transfer was made or the day the individual is eligible for Medicaid, whichever date occurs last.
What is a “look back” period and what penalties apply to a look back period?
If an institutionalized individual applies for Medicaid, a period of ineligibility shall be computed if:
- During the sixty (60) month period immediately preceding the baseline date assets were transferred for less than fair market value; or
- During the sixty (60) month period immediately preceding the baseline date, a trust was created whereby the individual or the spouse disposed of property for less than fair market value.
The period of ineligibility shall:
- Begin with the month of Medicaid eligibility; and
- Be equal to the number of months derived by dividing the total uncompensated value of the resources transferred by the transferred resource factor at the time of application.
“Transferred resource factor” means an amount that is:
- Equal to the average monthly cost of nursing facility services in the state at the time of application.
- The average monthly cost shall be the average of the private pay rates for semi-private rooms of all Medicaid-participating nursing facilities.
- This amount is adjusted annually. The current amount is about $5,833.
“Uncompensated value” means the difference between
- The fair market value at the time of transfer, less any outstanding loans, mortgages, or other encumbrances on the asset; and
- The amount received for the asset.
What is Income?
INCOME is the money received from statutory benefits, rental property, investments, nonrecurring lump sums, or for labor or services. Your income must be within Medicaid guidelines to get Medicaid nursing facility services. Medicaid will consider your income, but will not count your spouse’s income. The income limits may vary depending on the number of days you have received nursing facility services.
You are income eligible if your gross monthly income is at or below $2,130. If your income is over $2,130, you may become eligible by establishing a Qualifying Income Trust (QIT), also known as a “Miller Trust.”.
You may be required to pay part of the cost of your care. Patient liability is determined by considering your income and allowing a $40 deduction for personal needs, maintenance deductions for a spouse or family members and deductions for medical expenses and health insurance premiums. The amount left over is what you must pay to the nursing facility for your care.
There are also “maintenance allowance” rules that make sure the healthy spouse has sufficient income to live. The basic minimum “maintenance allowance” is $1,892 per month. This minimum is increased if your housing expenses are greater than certain standard allowances, with a current maximum maintenance allowance of $2,898 (effective 1/1/2013) per month.
What is Estate Recovery?
907 KAR 1:585 states that the department shall seek recovery from the estate of a deceased recipient for a period of institutionalization.
The amount recovered shall not exceed the amount paid by the Medicaid Program on behalf of the deceased recipient for services received during a period of institutionalization.
The amount subject to recovery shall include the expenditures for:
- NF services pursuant to 907 KAR 1:022;
- ICF/MR/DD services pursuant to 907 KAR 1:022;
- Home and community based (HBC) waiver services pursuant to 907 KAR 1:160;
- Supports for community living (SCL) services pursuant to 907 KAR 1:145;
- Acquired brain injury (ABI) waiver services pursuant to 907 KAR 3:090;
- ABI long-term care waiver services pursuant to 907 KAR 3:210; or
- Michelle P. waiver services pursuant to 907 KAR 1:835; or
Recovery shall not be made from the estate if the estate representative can verify to the department’s satisfaction that there is a:
- Surviving spouse; or
- Surviving child (“Surviving child” means a living child under age twenty-one (21) or a child who is blind or disabled as defined in 42 U.S.C. 1382c.)
Recovery shall not be made from the estate on any resources protected from consideration during the eligibility determination process based on payment issued by a long-term care partnership insurance policy.
The department shall waive estate recovery to the extent the recovery would work an undue hardship. The department may waive recovery if it is not cost effective to recover from the estate.
How Can I Apply?
We can help you make a Medicaid application at the DCBS office in the county where you live. Bring proof of citizenship, identity, social security number, income, resources, health insurance cards and premiums and medical bills to the application interview.