Medicaid Planning

MEDICAID PLANNING IN KANSAS CITY

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Rusty Fracassa and the staff at Paths Law Firm serving Kansas City are the most compassionate, attentive, and experienced elder law planners and advocates in the KC metro area.

We offer multiple office locations for your convenience. We can also meet at your home, the hospital, or a nursing home for those less able to visit our office. Meeting with clients on Saturdays to accommodate their schedule is just one of the perks of working with us.

The Issue and Planning for Medicaid

Medicaid is a joint federal and state program that provides financing for medical treatment for those unable to afford to pay. Medicaid covers physicians’ services, hospital care, supplies and other required services once a person has been made eligible for the program. It also covers the costs of nursing home care for the elderly.

Each state administers its own Medicaid program independently. While the basic eligibility requirements are the similar across the United States, there are substantial variances between the Medicaid programs of each state. In spite of these variations, eligibility is often determined by a combination of a person’s assets and income. State Medicaid offices decide eligibility, and in the case of married applicants, both spouses’ assets and income are considered.

It is essential to differentiate Medicare and Medicaid. Medicare is an insurance program that pays for the medical expenses of those aged 65 and older and some individuals with disabilities. All adults 65 and older, regardless of financial means or income, are eligible for Medicare. Medicare and Medicare supplementary insurance, however, give extremely little reimbursement for the expense of nursing home long-term care. Unless the individual has coverage under a long-term care insurance policy, these non-covered services must be paid privately by the individual. Medicaid, on the other hand, covers for medical requirements for persons of any age that have been proven to be qualified. In reality, a Medicare recipient with little income and assets may also qualify for Medicaid benefits.

What You Need to Know

Medicaid is regarded as one of the most complex laws in the United States, and the situation is further complicated by the fact that each state has its own version of Medicaid. Numerous Elder Law Attorneys are able to assist clients because they have researched the Medicaid statutes and regulations thoroughly.

Medicare does not cover the costs of long-term care for conditions such as Alzheimer’s disease or paralysis resulting from a stroke, thus Medicaid is frequently important to middle-income Americans. The majority of people who require long-term care will eventually exhaust their assets and be unable to pay for their care.

Medicaid is then available to pay the difference between their income and the actual costs of nursing home care, including room and board, medical treatment, hospital care, and all other reasonable and necessary medical expenses. Medicaid supports the costs of such care in nursing homes, adult care homes, hospices, and, where necessary, the individual’s own home.

If you anticipate incurring such long-term care bills, you should be aware of the following rules:

In assessing eligibility for Medicaid payment of long-term care expenses, the eligibility team will evaluate the individual’s actual need for care, the individual’s available resources (including life insurance and retirement plans), and the individual’s total income. In some places, if an individual’s monthly income exceeds a specific threshold, he or she is ineligible for Medicaid, even if long-term care expenses outweigh income.

In evaluating eligibility, a person’s recent charitable contributions will disqualify them from Medicaid.
The assets and income of both spouses are evaluated when evaluating eligibility for one spouse, regardless of premarital agreements, community property rules, or the nature of asset ownership.

However, married couples’ assets are treated differently so that the spouse who remains at home is not unjustly impoverished. Such a community spouse is entitled to retain one-half of the couple’s accessible assets (up to a federally-established maximum) and a minimum amount of the couple’s income in order to cover domestic support expenses (See below for details on Division of Assets).

In addition, there are resources that are not considered when determining eligibility; they include the family home, household goods, a vehicle, a pre-paid funeral fund, and other necessities.

Before applying for Medicaid, it is essential to understand the state-specific eligibility requirements and exemptions so that assets are not excessively depleted.

Lastly, it is essential to understand that appeals systems are integrated into the Medicaid system. If you disagree with Medicaid eligibility determinations, care decisions, or placements, there is a procedure for an administrative hearing and even legal action to vindicate your rights.

Source: National Academy of Elder Law Attorneys NAELA.org

Division of Assets

Frequently Asked Questions

The Spousal Impoverishment Law, often known as the Division of Assets, modifies the Medicaid eligibility requirements for couples where just one spouse requires nursing facility care. It permits the spouse remaining at home to safeguard a portion of income and assets. The spouse in need of care can acquire Medicaid sooner without the other spouse falling into poverty.

Yes, but only if your spouse can demonstrate a medical requirement for nursing home placement and meets federal and state eligibility requirements.

You must satisfy the following conditions:

Have a medical need for nursing home care
Meet Medicaid financial eligibility requirements
Not be disqualified for illegal property transfers.

You must contact KanCare to receive the necessary forms. You will be required to submit an application for Medicaid. You will be required to list every asset you and your spouse hold. The KanCare worker will decide how much of the community spouse’s resources can be protected. If there is a need to shift resources to the at-home spouse, the KanCare worker will notify you and provide you with the necessary documents.

Based on the information provided on the evaluation form, you will split the available resources. It may be necessary to transfer certain assets from the institutionalized spouse to the at-home spouse. You will be informed if any resources require transfer. You may also contact an attorney for assistance with the legal paperwork involved in the transfers. Do not add other people’s names to any assets during the transfer process without first consulting with KanCarefirst, since doing so could result in a delay or cancellation of Medicaid coverage for nursing facility payments. Medicaid benefits might be paid for up to ninety days while the real property transfer takes place. In some situations, extensions may be granted if you have been actively transferring ownership but have not yet completed the process.

Certain items are excluded from the Medicaid determination. These are exempt resources, which you may retain.

The dwelling and its contents
One automobile per family
One cemetery plot, coffin, etc. per individual.
A funeral arrangement within specific restrictions.
The part of property permitted to the at-home spouse by the Spousal Impoverishment Law.
Personal property such as wedding bands and clothing.
In certain instances, the property is utilized in an ongoing enterprise.

You may retain the larger of the first $25,284 of total non-exempt assets or half of the total non-exempt assets owned at the time your spouse joined a nursing facility. The maximum amount of retained stock is $137,400. These amounts are subject to vary on a yearly basis, so contact Kancare for the most up-to-date information. The remainder of the total assets is believed to be available to the institutionalized spouse.

The amount of assets that can be preserved is based on the entire amount of non-exempt assets owned by the marriage at the time the spouse initially entered an institution. This number is derived from the data you give and confirm on the Resource Assessment form. Alternatively known as the Community Spouse Resource Allowance.

After Medicaid approval, the LTC spouse may be responsible for a percentage of his or her medical expenses. The cost of care is determined by the institutionalized spouse’s monthly income. A $62 allowance for personal necessities is removed from the gross monthly income, along with any medical expenses not covered by Medicaid or any third party, such as health insurance premiums. This amount is also subtracted if the stay-at-home spouse is qualified for an income allowance as indicated above. The remaining funds, if any, are paid to the nursing home towards the cost of care. This amount is referred to as the patient or client duty.

No transfers should be made until all documentation has been completed and the amount of income and assets that the at-home spouse is permitted to retain has been decided. Transfers made prior to enrolling in KanCare might often affect Medicaid eligibility. Always seek KanCare’s prior consent before moving any funds or income.

Legally, the State Medicaid agency has a first-class claim against the Medicaid recipient’s estate or surviving spouse for benefits provided to the Medicaid beneficiary. The Medicaid beneficiary must have been at least 55 years old or resided in a nursing home while receiving benefits. This claim only arises after the demise of both the beneficiary and the surviving spouse. There would be no recovery if a minor or crippled child survived.

No. The couple has the option of seeking a distribution of resources, income, or both. If you do not, some assets and income will be considered available to the nursing home resident’s spouse, and he or she may not qualify as quickly.

Prior to receiving benefits, the spouse requesting for help must meet Medicaid eligibility conditions. This means that the spouse requiring care must deplete his or her part of the divided assets to the Medicaid qualifying threshold (now $2,000).

If new resources are acquired prior to the LTC spouse acquiring Medicaid coverage, they are often considered part of his or her share of assets and must be drained prior to eligibility. Due to the fact that the Community Spouse Resource Allowance is calculated as of the month of the spouse’s entry into long-term care, resources that neither spouse owned in that month cannot be included for division reasons. The spouse of a Medicaid client who is institutionalized will have their assets counted against the $2,000 limit. The receipt of resources exceeding this threshold may result in the loss of Medicaid coverage. The at-home spouse’s receipt of additional resources typically does not alter the eligibility of the other spouse for Medicaid.

Inflation adjustments will be based on changes in the Consumer Price Index. KanCare will calculate any increase automatically and adapt your case accordingly. The quantity of resources a stay-at-home spouse is permitted to retain will be determined at the time of application and will not be modified.

The statute solely applies to Medicaid eligibility for covered long-term care (nursing home), Home and Community-Based Services (HCBS), and Program of All-Inclusive Care for the Elderly (PACE).

When you and your spouse meet the following conditions.
A spouse currently resides in a nursing facility.
The income of the at-home spouse is less than $1,992.

Any property handed to a spouse is part of that spouse’s estate and will pass to heirs unless the recipient’s at-home spouse lives. According to state inheritance regulations, the receiving spouse should get at least half of the estate as an heir. If this does not occur, the recipient’s eligibility may be affected by a transfer of assets issue. If the at-home spouse survives the recipient, the State Medicaid Agency may file an Estate Recovery claim against the at-home spouse’s estate following his or her death.

No. Your heirs can only inherit your actual assets on the day you pass away. In addition, keep in mind that the estate of the spouse who stays at home will be subject to estate recovery, as stated previously.

The law only pertains to Medicaid eligibility.

Source: Kansas Department for Aging and Disability Services www.kdads.ks.gov

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