Medicaid Changes: New Home Care Rules to Limit Eligibility
State Steps Back from Pioneering Progressive Social Policy. New “Lookback” Provision to Cause Penalties, Delays.
The care available to New York’s most vulnerable seniors and people with disabilities is facing draconian changes, with new rules announced by the Department of Health that will limit eligibility and access for new Medicaid applicants.
The rule changes, effective November 8, 2021, will present significant new challenges to seniors and people with disabilities, transforming New York’s Medicaid home care benefits from the most generous in the nation to a more restrictive program.
Instead of getting needed care in the home, residents with chronic illness who have failed to plan will be ineligible to receive benefits and will need to pay out-of-pocket for home care during a penalty period, thus being forced to spend down life savings.
Significant adverse changes to be implemented in 2022 include:
- Independent Assessor (Maximus) to replace counties and Managed Long-Term Care programs (MLTC) to determine your Medicaid eligibility, i.e. Do you get care benefits? And if you do, how many hours?
- No role for your physician. State will create an ‘Independent Physician Panel’ that will review applications.
- Additional Medicaid review to be conducted by “Independent Review Panel” if elder or disabled person needs more than 12 hours/day of home care
- Additional Activities of Daily Living (ADL) requirements
- More ways the government can curtail or eliminate your home care benefits
New Financial “Lookback” To Be Enforced April 1 or potentially July 1 based on latest information from New York State:
Medicaid, unlike Medicare, is a means-based program, which means that only persons of limited means are eligible (“countable” assets of only $15,900). Currently, an applicant can give away assets and then apply for Medicaid community-based care the following month, without penalty.
One of the most prohibitive changes is to financial eligibility rules for Medicaid applicants, by imposing a ‘lookback’ for asset transfers phased in for a total of 30 months. This rule took effect in October 2020 but will not be implemented until April 2022 at the earliest. Applicants who transferred assets during this new lookback period will face a period of ineligibility when Medicaid will not be available to them.
As a result, there is a period of time now when Medicaid planning can be completed,such as gifts to family members or transfers into an irrevocable trust (a Medicaid Asset Protection Trust). These gifts won’t cause a waiting period, but only if the application for Medicaid is filed prior to the new lookback implementation date, currently April 1, 2022. Once qualified, applicants can begin services without application of the new penalty or other stringent rules.
Fortunately, existing exceptions to the transfer of asset penalty rules, such as gifts to a spouse or a person who is disabled or blind, have not been repealed.
“Spousal Refusal” Is Still an Option
A bright spot here is that the planning opportunity known as Spousal Refusal is still available. This means that a Medicaid applicant’s eligibility for Medicaid (in home or nursing home) cannot consider the assets or income of his or her “community” spouse, who often still lives in the home, in determining the applicant’s financial eligibility.
Nursing Home Care
With regard to nursing home care, New York state will continue to impose a five-year lookback period for asset transfers to qualify for skilled nursing Medicaid benefits. The new rules mentioned above only apply to Medicaid benefits provided in the home.
Take the Next Step
If you or a loved one has a chronic condition or if you wish to plan ahead to afford the exorbitant costs of long-term care, speak to the elder law attorneys at Pierro, Connor & Strauss, LLC. Schedule a free consultation by calling (866) 951-PLAN (7526) or email us at [email protected]
This memorandum is based on the most recent information provided by the New York State Department of Health.
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