Persons who are receiving nursing home level of care in their home though a home health agency paid for by the Medicaid Waiver Program are also considered nursing
home residents for the purposes of implementing these changes. There are several changes that will impact these persons dramatically.
Homestead Exemption for eligibility purposes
Previously a nursing home resident's home was considered exempt and not counted as an available asset for Medicaid eligibility purposes. However
effective Sept. 1, 2003, persons who have been in the nursing home for six months or more will no longer have their home considered an exempted asset.
At that point, in order to continue being covered by Medicaid, the nursing home resident must show that they have listed their home for sale.
If they do, they will be eligible for another six months. In order to remain eligible beyond that point, a special exemption will need to be applied for.
These exemptions will be granted at the discretion of Medicaid and the decision will be based upon provision of proof that efforts to sell were unsuccessful. Once the home sells the resident will be disqualified from Medicaid until they have spent that money and their resources again fall below the $2,000 available resource limit.
A nursing home resident whose home is deeded to someone else but who retains a life care estate will be considered to have a countable value subject to the new rules above. The value of the life care estate will be calculated based upon the age of the resident and the value of the property.
Transfer of assets
Previously, a nursing home resident could add names to the homestead deed without it being considered a transfer of assets for less than fair market value. Adding a name to the deed after Sept. 1 will be considered a transfer of an asset and subject to rules for transfers of assets.
Assets transferred for less than fair market value will subject the resident to a period of ineligibility.
Homestead Exemption for purposes of estate recovery
Previously $50.500 of the resident's homestead was exempt from estate recovery, should the resident die without being survived by a spouse. Estate recovery is an attempt by Medicaid to recoup expenses by placing leans against the estates of deceased nursing home residents.
There was a proposal which looked like the most likely proposal to be adopted by the cabinet, which would have lowered that exemption to an amount tied to the prevailing property values in the area.
However, the Cabinet has decided to do away with the exemption all together effective Sept. 1.
Community Spouse Maintenance Allowance
Under the old regulations a nursing home resident could allocate as much of their monthly income as desired to the spouse remaining in the community so long as the income of the community spouse did not exceed $2,267.
In June the Cabinet began calculating the amount the resident could allocate to their spouse by using a formula which takes into account the community spouse's income and shelter expenses in order to determine the allowable maintenance deduction.
Residents are now only allowed to allocate up to $1,515 of their monthly combined income to the non-institutionalized spouse.
The resident may be allowed to allocate an additional amount for shelter expenses if the spouse can document that their shelter expenses (rent, utilities and telephone) exceed $455 a month.
The new rules are being applied to all nursing home residents whose applications were processed on or after June 2, 2003.
Transfer of assets to community spouse
Previously the nursing home resident could transfer any assets to their community dwelling spouse so long as the spouse's assets did not exceed the maximum, which in January 2003 was $90,660.
In order to determine eligibility, a calculation is done to assess whether or not the nursing home resident has available resources in excess of $2,000. Those resources that the nursing home resident transferred to (or indicated the intent to transfer to the non-institutionalized spouse within six months of the date of a previous application) were not considered available to the nursing home resident for the purposes of calculating Medicaid eligibility.
Beginning June 1, resources transferable to a non-institutionalized spouse by a nursing home resident were reduced. Now, only one-half of the couple's combined, countable resources can be transferred to the non-institutionalized spouse or $20.000, whichever is more and the community dwelling spouse's assets still cannot exceed $90,600.
The amount of resources that a nursing home resident with an active Medicaid case on June 2 and who was in the facility prior to June 2 can transfer to their
non-institutionalized spouse will still be calculated at $90,660.
Nursing home residents have already begun receiving letters informing them of Medicaid's new Qualifying Income trust rules.
Nursing home residents whose income exceeds $1,656 will only qualify for Medicaid if income above that amount is placed in a Qualifying Income Trust Fund known as a "Miller Trust." The money in the trust is not counted in determining Medicaid eligibility.
Funds from the trust may be used to pay for the cost of the resident's care. The trustee must consult with Medicaid before making any payments from the trust. Medicaid will get what is in the trust when the beneficiary dies.
Letters notifying beneficiaries about this new requirement have already begun going out. Beneficiaries with income more than $1,656 will need an attorney to draw up the trust.
Nursing facility level of care criteria
One change has already gotten a lot of publicity because of the large number of persons affected and the level of hardship people are indicating it is causing. This is the new level of care criteria.
Under the old rule a Medicaid beneficiary qualified for nursing home level of care if they required skilled care or if they had a stable medical condition manifesting a combination of specifically stated but loosely defined care needs that the professional staff determined required the provision of intermittent skilled needs and continuous personal care or supervision.
Back in April the cabinet began implementing new level of care regulations which look more at what the nursing staff is doing than at the resident's condition. Now, the beneficiary must either require skilled care or require staff assistance with at least three of nine very strictly defined care need areas.
Persons whose needs are limited to a list of what the cabinet is calling personal care services no longer qualify for nursing facility level of care. Personal Care services under these regulations include limited assistance with activities of daily living; (bathing, dressing, or grooming,) independent use of mechanical devices ( assistance in mobility by means of a wheelchair, walker, crutch or cane,) limited diet (low salt, low residue, reducing or another minor restrictive diet,) medications or therapies that can be self-administered or when the individual requires minimal supervision, general supervision (routine use of oxygen on an "as needed" or continuous, or at night,) or the limited ability to perform instrumental activities of daily living (meal preparation, homemaking, or doing laundry.
Persons whose care needs arise directly from a mental illness mental retardation or a developmental disability are also ineligible.
Ironically, advocates are finding that many of the residents forced out of nursing facilities under this rule may not be eligible for admission at many personal care facilities because their medical conditions are too complex.
Editor's Note: Ruth Morgan is the Barren River Long Term Ombudsman. She can be reached at 1-800-355-7580