Monday, July 30, 2012
Many people pay for these costs from their personal savings. This results in the depletion of all savings and assets. Who is eligible for Medicaid? Only after your assets have been depleted does one get eligibility for Medicaid benefits. There is an advantage to paying for the nursing home with your own money. It allows you to choose where to live and it can eliminate having to deal with state bureaucracy. The disadvantage is the huge expense. This is why careful planning is so important.
Asset protection for your estate is possible. A long-term care insurance policy could possibly help achieve this, but it not the best way to protect your assets. Whether you are receiving Medicaid or Medicare benefits, it is important to take proper planning steps to make sure you are receiving all of the benefits you are entitled to as early as possible.
Medicare Part A is something that every aging person should be familiar with. This part will cover up to 100 days in a skilled nursing facility per illness. The catch is the actual definition of a skilled nursing facility. In fact, due to the strict guidelines and varying definitions, very few people are actually entitled to these 100 days. The end result is that Medicare ends up only paying for 9% of all nursing home care in the country.
Medicaid on the other hand is the only way to obtain long-term medical care in the United States. Most people are required to pay nursing home costs out of their own savings until they have reached the financial eligibility. Medicare and Medicaid are often confused. It is important to understand that these are two completely different programs with different benefits. Medicare is the health insurance granted to those who receive Social Security. It is an entitlement program that could be compared to PPO's and HMO's like Blue Cross Blue Shield and United Healthcare. Medicaid is a form of welfare and is largely based on income. To be eligible for this program, you must not earn more than the specified amount in a one month period - in most states the absolute maximum income level is $2,300 per month.
This program is administrated by individual state governments, but is reimbursed by the federal government and thus most states rules are very similar but different. Each state has its own form of the program, often called by different names. The state operates the program, but all programs must conform to specific federal guidelines. This means that the rules and regulations differ in each state, which can cause a lot of confusion. The best thing to do is contact your state to find out exactly what the eligibility rules are and what benefits are offered through the program. These programs change often so it is important to always have the most up to date information available.
One way people plan for the program is by distributing their assets before they require the benefits. When this is done, individuals will be able to qualify for the program faster than if they had to spend down their savings and deplete assets. This is why planning can be difficult. It is nearly impossible to know when you will need long-term care. However, planning for this care is one of the most important things to do. An asset protection plan is one way to go about planning. These plans will reallocate your assets and transfer money, making you eligible for the program when the time comes.
An irrevocable trust is one that cannot be revoked, amended, or changed once it is signed. Do not confuse this with a "Living Trust" done for probate avoidance purposes; that type of trust is revocable and will not work for Medicaid planning. Your elder law attorney would draft the trust for you and then assist you in transferring some portion of your assets into the trust. (I am omitting many details of how the trust is to be drafted, set up, and funded. For a detailed discussion of such trusts in the Medicaid planning context, see my book, "How to Protect Your Family's Assets from Devastating Nursing Home Costs: Medicaid Secrets.")
A transfer into such a trust is considered a gift for Medicaid eligibility purposes. Thus, the usual "penalty period" and "lookback period" rules apply to the gifts into the trust the same as they would with an outright gift.
For example, assume you create your new trust and immediately transfer $180,000 into the name of the trust, leaving you with only minimal other countable assets. Assume you do this on January 1 of Year 1. Also assume that the state you live in has a "penalty divisor" of $5,000, meaning that there is one month's penalty for every $5,000 worth of gifts.
Here's how the rules play out:
Penalty Period. Since the amount of the gift was $180,000, if you went in to apply for Medicaid the next day, there would be a "penalty period" (i.e., period of time that you would be disqualified from receiving Medicaid assistance) of 36 months ($180,000 / $5,000 = 36).
Lookback Period. For any gift made on or after February 8, 2006, if you apply for Medicaid within 5 years of such gift, there will be imposed a penalty period. So in our example, if you apply for Medicaid at any time before January 2, Year 6, you will be faced with a 36-month penalty period that begins on the date you apply! That's right---even if you make the gift today and apply for Medicaid in 4 1/2 years, you will have to wait another 3 years because of the penalty! "Gee, I could have just waited another 6 months and I'd be out from under the lookback period and have no penalty!" Exactly. So be careful of applying too early!
But what if you might need nursing home care prior to Year 6? All your money is tied up in the trust, so how can you pay for the nursing home? Essentially, your family members will have to pay your expenses for that period of time. (It may be possible for the trust to be drafted so that money in the trust can be distributed to your family members for this purpose, but this must be very carefully done in order to avoid serious trouble.)
In that case, the big question is, when do you apply for Medicaid? Of course, you must actually have a medical need for nursing home-level care in order to apply. But if you require nursing home care in Year 1 or Year 2 and apply for Medicaid at such time, there will be a 3-year penalty period from the date you apply. In other words, you will be eligible to re-apply for Medicaid in Year 4 (if you apply in Year 1) or Year 5 (if you apply in Year 2). Obviously that is better than waiting for the expiration of the entire 5-year lookback period, which won't occur until Year 6.
However, if you don't need nursing home care until at least Year 3, you are better off not applying for Medicaid until after the complete expiration of the lookback period, i.e., in Year 6. That's because if you apply in, say, June of Year 3, you will still be disqualified for an additional 3 years, i.e., until June of Year 6 (instead of only until January of Year 6). And if you apply in Year 5, you won't be eligible until some time in Year 8!
It's important to remember that the numbers above only apply to this particular example. You must work out the details with your elder law attorney, since the optimal time to apply will be governed by your health, your other (non-trust) assets, your family's ability to cover your expenses, the amount you gifted into the trust, your state's penalty divisor.
Currently, there are 25 categories of eligibility which can be classified into five coverage groups. These groups include children, individuals over the age of 65, individuals with disabilities and adults with dependent children. The eligibility will differ from state to state, but all states are required to cover mandatory groups. However, the state can decide whether to cover groups that are categorized as optionally eligible. Most states have forms online that you can download and print out, however no states currently allow you to submit an online application.
These groups include pregnant women, children and low-income families who have dependent children. The income level of these groups must be lower than the poverty level. Some Medicare beneficiaries may also be eligible for additional coverage by Medicaid.
These beneficiaries will vary from one state to another. Each state is allowed to use their own discretion to provide benefits to these groups. Always be sure to check the eligibility requirements for your state when planning an application. If you believe you have met the requirements and have been denied coverage, you have the right to appeal the decision. Any appeal information will be printed on your eligibility notice that will be received in the mail.
To apply, you can obtain an application at an office run by your state government. You cannot yet apply for it online. If you fill out an application at an office, the office is responsible for processing the application. While the application process does take some time, most states are required to complete the application within 45 days. If the application is based on a disability, the state has up to 90 days. The most common reason for denial is an incomplete application, so make sure all parts of the forms are completed when filling out the application. Also be sure to have all required documentation available to include with the application.
In some cases, if you are receiving Medicare, it may pay for some of the premiums, coinsurances and deductibles. You could also be eligible for Medicare related expense payment if your income is more than 100% or less than 120% of the poverty level. If you are disabled, it will pay for Medicare Part A premiums if you have lost your Medicare coverage due to employment. Your income must be below 200% of the poverty level.
For state run programs to be eligible for funding there are certain services that must be provided to certain populations. The health care help must include services including hospital services, payment for physician services, nursing facilities for people over 21 years of age, surgical dental services, family planning, midwife services, x-rays, laboratory services, pediatric services, rural health clinic costs and federally-qualified health center services. An optionally eligible program will cover clinical services, prescription drugs, dental, prosthetics, optometry, nursing facilities and intermediate care for the mentally retarded.
Each state will determine the duration of all its benefits. Federal guidelines must be followed and they require that the amount and duration of service is reasonable. Each state is responsible for placing a limit on benefits thereafter. In most cases, those on it are allowed to choose between health care providers. The state may also elect to run the program through an HMO. Always check with the state laws and guidelines for it to know what benefits are available.
Payments are made directly to the health care providers. Providers are required to accept all its reimbursements in full. However, the state is allowed to change the copayments and deductibles for certain recipients. For emergency care and family planning services, the state cannot make these changes. Pregnant women, children under 18 and individuals in nursing homes are exempt from copayments.
Currently, there is no limit or cap on the services received under it. The federal government is required to match what each state provides. The reimbursement rates must be sufficient so that providers will be attracted. This allows Medicaid benefits and services to be available to the qualifying population in the state.
At that point, you could (i) spend the money on your nursing home bills until you are once again down below the $2,000 limit and then re-apply for Medicaid, or (ii) engage in some asset protection planning to preserve some if not all of that lump sum payment, before re-applying for Medicaid.
For example, you may want to use the money to purchase a car. As long as the car is used for the transportation of you or another household member, it will be excluded, no matter how much it costs (within reason). Another use of the proceeds would be to purchase a pre-paid funeral/burial plan. Again, there is no limit to the cost, so long as it is all actually to be used for your funeral and burial.
If there is quite a lot of money from the insurance policy, then other more complicated planning techniques can be employed, some of which are discussed in my other articles on this site. For instance, a gift combined with purchase of a "Medicaid annuity" can generally protect at least one-half of the money.
Finally, note that if the insurance proceeds are paid to the at-home spouse of the nursing home resident, then such money will NOT count against the Medicaid eligibility of the nursing home spouse. Beginning with the start of the month after the nursing home spouse is initially deemed eligible for Medicaid, the assets of the at-home spouse are not considered available to the nursing home spouse.
Another exemption is life insurance owned by you. The rule states that only the "cash surrender value" of a life insurance policy is countable, but only if the total face value of all life insurance policies on your life exceeds $1,500. ("Cash surrender value" is the amount the life insurance company will send you if you canceled the policy. It's also known as the "cash value." The "face value" is what the company would pay out to your beneficiaries if you died, assuming the policy was still in effect.)
So if you have a $1,000 policy with cash value of $800, you can keep it and it will not count towards your $2,000/$101,540 limit.
What if you have a term policy with a face value of $100,000? It's completely exempt since a term policy by definition has no cash value. Of course, you (or another family member) have to pay the premium each year to keep it in force.
What should you do with existing policies? If you have an existing policy and your health is not good, you may decide to keep the policy rather than cancel it. After all, you may be uninsurable, and if you keep the policy in force, your family members could benefit from the proceeds upon your death.
Assuming the total face values exceed $1,500 and your countable assets put you over the limit to qualify for Medicaid, it could be a good idea to have your children purchase the policy from you and keep it in effect (by paying the annual premiums). You see, it's not who is insured or who is the beneficiary that matters---it's who is the owner of the policy. The reasoning for this Medicaid rule is that the owner could simply cash in the policy at any time, and thus it is counted the same as if you already did so. But if your child is the owner, you have no ability to cash in or cancel the policy, so it would no longer count against you.
Another option is to assign the policy to a child, as a gift. This will cause a penalty period so in many cases this is not the best solution. However, as part of an overall plan that includes other gifting, it could make sense.
Recently, some companies have advertised single pay, non-cancelable, no cash value "life insurance." The idea behind these policies is that if there is no cash value, the policy cannot count against you. They are set up with minimal underwriting (i.e., virtually everyone is guaranteed to qualify to buy one), and the beneficiaries are usually the children.
The problem is that if you purchase an asset over which you have no control---you cannot cancel it, cannot get your money back, cannot even change the terms or the beneficiaries---the Medicaid agency may well deem this to be a gift. If that's the case, you have not accomplished what you thought you had, i.e., converting cash to a non-countable form, so that you did not have to make a gift of the cash. Accordingly, I advise my clients to stay away from this type of product unless and until it has been proven to be effective as advertised.
What the Federal government does specify is very detailed guidelines which guide the states in what individuals absolutely must be covered. Ultimately, how each state decides to interpret and follow these guidelines will determine their own rules and guidelines for approving or turning away particular candidates.
In general, if your income places you at or below 133% of the current poverty line for the nation or you are receiving income assistance from the Federal government, you are automatically qualified for Medicaid no matter which state you live in. This is a welfare program and should not be confused with Medicare eligibility. When it comes to Medicare eligibility this is dependent on contributions from Social Secuirty.
There are more complicated guidelines under which the Federal government requires each state to cover particular groups of people, but the best way to determine whether you qualify for medical benefits is to contact your state's social services office.
Most state's have their own programs which will help people who are struggling but for one reason or another do not qualify for Medicaid benefits. Usually, these programs will accept anyone who is struggling, so the best course of action is to contact your local social services or similar titled agency and ask what the current guidelines are in your state.
Since every state has a different policy and routine for processing applicants, it is best to go straight to their offices for the current Medicaid eligibility criteria. They will be able not only to determine whether you can receive these benefits, but sign you up for other programs which may help you along as well. Depending on which state you live in, your family could be qualified to receive help with food and other needs as well as Medicaid.
Saturday, May 26, 2012
Such a delicate subject requires superior medicine. Homeopathy treats the whole person using safe, natural substances in a potentized form. Instead of medicating the problem, homeopathy addresses the entire person. This means that digestion, skin and sinuses are all connected. So, when a man has a problem that is experienced in one area, the entire person must be considered.
Homeopathic philosophy believes that the human body has the ability to heal itself when given the matching stimulus found in nature. The stimulus is in the form of a homeopathic remedy that is taken in pill form. The correct homeopathic remedy will bring about the action that will put the sufferer’s pathology to rest. It will also relieve other maladies that accompany the main problem.
Let’s consider three of the most valuable homeopathic remedies for this important issue that may occur in a man’s life.
Caladiura is a remedy of repute that has been used for the inability to perform in relation to a man’s mental state. The key to determining the choice of this remedy is the sufferer’s demeanor. He is often one who experiences mental depression along with impotence and the new problem is met with a deepening of this depression.
The remedy Selenium has been shown to be of greatest value when the man experiences weakness after coition. This may not happen every time, but more commonly occurs after excesses. Accompanying the exhaustion, there may also be prostate problems such as urine and seminal loss.
Agnus castus is reputed to be of value for men as they age and is noteworthy when the desire has been lost or impotence is a problem. Premature old age, where the genitalia are cold, is a characteristic that historically points to the need for this remedy. Often, there is a history of an excessive sexual appetite earlier in life, but, in later years, is missing. There may be accompanying anxiety and despair, particularly about health issues and especially his ability. Memory and mental dullness may also be present. A collapsed or broken down state that occurs after overindulgence in alcohol, drugs or in sexual matters may also be present in men who will benefit from this remedy.
Lycopodium is a fine remedy of repute in men’s health. When sexual dysfunction accompanies a lack of confidence though there is an increased desire, this remedy can be considered. This situation can be particularly trying in old men who marry young wives and are impotent as a result of their age. There is often a corresponding abdominal bloating and distention that may be distressful after eating. Gurgling, gas and belching are also a problem for this man.
Homeopathy is whole medicine that is chosen for each person on an individual basis. The correct remedy will stimulate the person’s natural healing response to bring the body back to balance and heal itself. No drugs of questionable safety, no regular repeated use. Just a return to simple old fashioned well being so that the problem simply doesn’t exist.
The information provided in this article is for educational purposes only and may not be construed as medical advice. The reader is encouraged to make independent inquires and to seek the advice of a licensed healthcare provider.
“Health is not random” says homeopath, Joette Calabrese HMC, CCH, RSHom(Na). Her book Cure Yourself and Family With Homeopathy and her CDs Perform in the Storm, a Homeopathy First Aid and Secret Spoonfuls; How to get Healthy Foods into Kids Without Getting Caught are collections of experiences as a skilled homeopathic consultant to hundreds.