LEAVING NURSING HOME WHILE STILL BEING TREATED – IS IT POSSIBLE?
Nursing home residents often want to participate in holiday gatherings but may worry they will lose Medicare coverage if they leave the facility to do so. Residents and their families and friends can put their minds at ease. According to Medicare law, nnursing home residents may leave their facility for family events without losing their Medicare coverage.
However, depending on the length of their absence, beneficiaries may be charged a “bed hold” fee by their skilled nursing facility (SNF). The Medicare Benefit Policy Manual recognizes that although most beneficiaries are unable to leave their facility, “an outside pass or short leave of absence for the purpose of attending a special religious service, holiday meal, family occasion, going on a car ride, or for a trial visit home, is not, by itself evidence that the individual no longer needs to be in a SNF for the receipt of required skilled care…Decisions in these cases should be based on information reflecting the care needed and received by the patient while in the SNF and on the arrangements needed for the provision, if any, of this care during any absences.”
Couples Fight More About Finances before Retirement – No Duh?!
Interesting article about the stress retirement and finances can put on couples. It is CRITICAL that couples put together a PLAN that address their concerns with specific details to protect and preserve their finances and assets. We are happy to meet with you to discuss how we can protect your assets and take the stress out of retirement.
There is an old adage: A FAILURE TO PLAN IS A PLAN TO FAIL.
This is true with most aspects of life but most especially with finances. Too often people wait too long to face the economic realities of retirement. The thought being I will just earn as much as I can during my working days and hope it holds me is simply not enough. People do not need to live in the dark or in fear. Meeting with a financial planner who can model out your lifestyle and the costs associates with it will be helpful in determining if you need to make adjustments.
The other aspect of finances is seeking to protect them. If you learned that you would need to spend over $109,000 per year on a spouse and their care in 3 years, would you do anything different today? The answer to that is a most definite YES. Should one of you require skilled care, it costs over $109,000 per year and is not covered by insurance, thus a plan for that expense is critical for the healthy spouses financial future.
Want to discuss your plan? Contact us for a free consultation.
The Medicaid Global Waiver is an agreement with the federal government about how Medicaid money is spent. Medicaid, a program that funds health services for qualified elderly, disabled, children, and families, is paid for by both the federal and state governments. Under this new agreement, the federal government will relax its Medicaid rules to allow Rhode Island to spend federal Medicaid money on a broader range of services through streamlined administrative processes that would not have been possible without the Medicaid Global Waiver.
Why the Waiver program?
The significance of this is intended to provide greater flexibility to provide services to needy Rhode Island residents in a lower cost setting. Allowing for state provided services in home with the hope of providing better care for the individual and greater savings to the taxpayer.
Want to learn how to qualify for Medicaid benefits? Contact our office for a free consultation.
Global Waiver Questions & Answers
What is the Medicaid Global Waiver?
The Medicaid Global Waiver is an agreement with the federal government about how Medicaid money is spent. Medicaid, a program that funds health services for qualified elderly, disabled, children, and families, is paid for by both the federal and state governments. Under this new agreement, the federal government will relax its Medicaid rules to allow Rhode Island to spend federal Medicaid money on a broader range of services through streamlined administrative processes that would not have been possible without the Medicaid Global Waiver.
Why does Rhode Island need this waiver?
Under the current system, federal rules governing how Medicaid money can be spent do not allow for the healthcare innovations Rhode Island envisions. The Global Waiver will facilitate increased consumer responsibility and choice, more emphasis on prevention and wellness, greater reliance on home and community based care as opposed to institutional care, and simplified administration of the Medicaid dollars.
Along with improved health care the waiver is needed to ensure that Medicaid programs remain affordable. Medicaid spending accounts for 25% of the state budget and is growing at a rate of 7% a year. With state revenue only growing at a 1.8% rate, it is easy to see that Medicaid spending is outpacing our ability to pay. That means that without changing the way we provide and pay for Medicaid services, those services are in danger of being lost. By receiving this Global Medicaid Waiver, Rhode Island will be able to preserve and improve services while keeping them affordable.
What if the recession worsens and more and more people become eligible? Will RI run out of money?
The secondary purpose of the Global Waiver is to make Medicaid programs more affordable. So, the expectation is that RI will be saving money and, ultimately, be able to serve more people. In other words, RI will better handle an influx of people into Medicaid programs through the Global Waiver than under the existing system. Although the Global Waiver has planned for many contingencies, if unforeseen and emergent conditions arise that make the Global Waiver unworkable, the State may suspend or terminate the Global Waiver.
Will people who now receive Medicaid-funded services lose them?
No. The State of Rhode Island is bound to follow the eligibility rules that were in place as of November 1, 2008. These eligibility rules cannot be easily changed; any changes must be approved by the state legislature and the federal government.
Will the Governor unilaterally change eligibility for certain populations?
The Governor cannot act alone without public input and legislative approval.
Will people in nursing homes be forced to leave?
No. Anyone who is in a nursing home and continues to need a nursing home can stay in the nursing home. With this new waiver, the goal is that people will not be forced to go into nursing homes because they lack choices. The Global Waiver will enable the State of Rhode Island to develop options for people so that more can stay in their homes with the proper supports if they so choose. Under the old Medicaid rules, this was not possible; now, Medicaid money will pay for more home and community-based care options.
Will the global waiver offer protection from a waiting list for seniors currently eligible for nursing home services?
There is no waiting list now for nursing homes and no waiting list is anticipated under the waiver. Anyone who needs nursing home level of care will receive it.
How will this relate to residents in assisted living that are currently on an existing waiver now?
Residents in assisted living can remain in assisted living if they so choose. Under the current system, there are limited assisted living slots. Because the Global Medicaid Waiver merges all waivers, it will open up the number of assisted living slots. In addition, the “selected contracting provision” in the Global Medicaid Waiver has the potential of paying certain kinds of assisted living differently, further opening more assisted living beds.
What is the timetable for these programs?
The Medicaid system as we know it has grown over the last forty years. Reforming that system and making it more affordable will not happen overnight; that will take a few years. The first order of business is legislative approval. After that, the Assessment Team will be assembled and new levels of care will be drafted so that Assessment Services will be operating by July 1. In the meantime, departments will be working with providers to offer more home and community based services.
Will there be public hearings?
Yes. This is really a community effort and the input of the public will be sought – as it has been – in addition to the legislative hearings.
Does the waiver conflict with any state laws?
No. The waiver must conform to all state and federal laws. Changes in the Medicaid program cannot be made without public notice and legislative approval.
How many different waiting lists will there be?
There are already waiting lists for some Medicaid-funded services. That will not change initially, but the goal of the Medicaid reforms made possible by the Global Waiver is to eliminate waiting lists.
Who will decide whether or not a person requires nursing home or residential care?
There are already state regulations that dictate whether or not a person requires residential care. The new Global Waiver will make two differences. First of all, there will now be more alternatives to residential care so that even if a person requires a high level of care, it may be possible for him/her to receive that care in the home and community. Secondly, an assessment team of medical and social service professionals will be created that will now include the individual and family in the decision-making so that all the options can be studied and the best one chosen.
What happens if a person or family disagrees with the assessment team’s decision about what kind of care is recommended and would be paid for?
People will be able to appeal any decision to an independent board.
What criteria are used to decide if a person needs residential care?
People are assessed for their skilled needs or their ability to perform what are called, Adult Daily Living Skills. If they require extensive or total dependence they are eligible for nursing home care. Now, with the Global Waiver, more supports will be created that will assist people with these Daily Living Skills in their home or in less restrictive settings.
If more than one person in the family qualifies for Medicaid help is there a preference given to keep them in their homes?
The advantage of the Global Waiver is that families can be assessed as a unit and not according to separate programs. Standards will be set for these sorts of situations, but the family will also be able to weigh in on the decision.
Are there any built-in preferences in this system? (Who gets help first?)
Priority is based on medical necessity; those in need of the highest level of care get priority.
We’ve heard that you’re considering a proposal for the Alliance for Better Long Term Care to send staff into nursing homes to identify candidates for return to the community and do assessments. Is that so, and what can you share with us about that?
The Alliance for Better Long Term Care has been contracted to bring good news to people in nursing homes who might want to live in their own homes or more independently. No one who is in a nursing home will be asked or forced to leave. However, those who want and are able to leave nursing homes due to new home and community based options may do so if they so choose.
Isn’t there a nursing shortage in RI? Where will all these home care professionals come from?
Now that money is available for a different range of services, agencies and companies will make the commitment to expanding services and staff. With new opportunities created, smart companies will move toward training and recruitment to take advantage of the Global Waiver.
What kinds of home and community based services are envisioned by this Global Waiver?
They would include: housekeeping, nutrition, nursing care, medication management, financial management, medical transportation, physical and occupational therapy, day care, home companions, coordinated medical care, assisted living and other non-institutional living arrangements.
The Rhode Island Medical Assistance Program, also known as “Medicaid”, is a Federal and state funded program that pays for medical and health related services for eligible Rhode Islanders. This inincludes inpatient and outpatient hospital care, preventive services, durable medical equipment, and many more services and benefits.
In order to qualify for this benefit program, you must be a resident of the state of Rhode Island, a U.S. national, citizen, permanent resident, or legall alien, in need of health care/insurance assistance, whose financial situation would be characterized as low income or very low income. You must also be either pregnant, a parent or relative caretaker of a dependent child(ren) under age 19, blind, have a disability or a family member in your household with a disability, or be 65 years of age or older.
What is Medicaid Planning?
Medicaid Planning is a form of estate planning where assets of an individual are transferred into various trusts and five (5) years after the transfer the individual would be eligible for Medicaid.
Qualifying for Medicaid is based on medical needs and assets. Applying for Medicaid is a cumbersome process, a long application that is often intimidating to many first time applicants. People often ask about qualifying for Medicaid – that process as mentioned earlier, is one that requires strict attention to the rules of eligibility and being careful with asset transfers.
Want to learn more? Contact us to schedule an appointment.
This is a fantastic recap of the economics and demographics of the Medicaid Program in Rhode Island. I highly recommend all citizens understand the scope and scale of the program in Rhode Island.
1. Rhode Island spends a ton of money on Medicaid every year.
Rhode Island spent $1.785 billion on Medicaid in the 12-month fiscal year that ended June 30, 2013; the total state budget that year was $8.1 billion.
Slightly more than half the money spent on Medicaid services usually comes from the federal government, with the rest covered by taxpayers in Rhode Island.
Here’s a chart showing the annual cost of Medicaid in Rhode Island over the five fiscal years through 2012-13:
2. Nearly one in four Rhode Islanders used Medicaid in recent years.
Part of why Medicaid is such an expensive program is because it’s such a large one. During the 2012-13 fiscal year, 22% of Rhode Island’s population – about 230,000 of the state’s roughly 1 million residents – used Medicaid at some point in the year.
Since there’s some amount of “churn” in Medicaid throughout the year – people signing up, people dropping off – the average number of Rhode Islanders signed up for Medicaid at any point in the fiscal year was somewhat lower: 195,000.
3. Rhode Island spends more per Medicaid enrollee than most states.
All the states in the Northeast spent more on Medicaid per beneficiary than the national average, with the exception of Vermont.
4. Obamacare is expanding the Medicaid program significantly.
The Affordable Care Act – Obamacare – expanded eligibility for Medicaid. Unsurprisingly, that has led to a surge in enrollment and will lead to a surge in spending on the program.
Rhode Island’s total spending on Medicaid is projected to be $2.7 billion in the current fiscal year, which runs through June 30, 2015 – an increase of nearly $1 billion from two years earlier. Enrollment is projected to jump from about 190,000 residents at the end of last year to 261,828 residents as of this past summer. The federal government is picking up much of the tab for newly eligible enrollees, however.
Here’s a chart showing that Medicaid spending is projected to consume nearly one-third of Rhode Island’s general revenue (basically, taxes and fees paid in the state) in this year’s budget:
5. Nearly half of Medicaid spending goes to hospitals and nursing facilities.
This chart is pretty self-explanatory:
As the figures at the bottom of the chart show, there’s a big difference in how fast costs have been going up annually between different types of Medicaid providers in Rhode Island.
6. The majority of Medicaid spending is for elderly and disabled residents.
The stereotypical Medicaid beneficiaries are single mothers and their children, and for good reason – in Rhode Island, they made up two-thirds of those who used the program (134,383) in the 2012-13 fiscal year. Their share is up to roughly 80% post-Obamacare, state officials report.
However, children and families aren’t where most of the Medicaid money is spent – not by a long shot.
Elderly Rhode Islanders accounted for just 9% of Medicaid enrollees (18,077 residents) but 27% of Medicaid spending ($484 million) in 2012-13. Similarly, disabled adult Rhode Islanders accounted for just 16% of Medicaid enrollees (30,987 residents) but 37% of Medicaid spending ($667 million).
It cost Medicaid $2,230 per member per month to cover elderly Rhode Islanders and $1,793 per member per month to cover disabled adult Rhode Islanders in 2012-13. It only cost $288 per member per month to cover Rhode Island children and families; they’re relatively cheap to cover.
Here’s the breakdown of spending on the four subgroups of Medicaid beneficiaries:
Put succinctly, the majority of people on Medicaid are children and families, but the majority of Medicaid spending is on elderly and disabled adult residents.
7. Rhode Island Medicaid spending on its two priciest groups is above average.
In 2011, Rhode Island’s Medicaid program spent 68% more than the national average for elderly residents and 15% more for disabled adult residents. These costlier-to-cover groups also made up a larger share of Rhode Island’s Medicaid enrollment:
8. Spending per Medicaid enrollee has been falling, except for the elderly.
Rhode Island’s total Medicaid spending rose an average of 1.3% a year between the state’s 2008-09 to 2012-13 fiscal years, and actually fell by 1.5% per enrollee over that period.
The outlier was elderly residents, the only group for whom cost-per-member rose over that period, as this chart shows:
9. Two-thirds of Medicaid spending on the elderly goes to nursing facilities.
“Most of the growth in Medicaid expenditure for elders has been in nursing home services and home and community based services,” the executive office explains in its report. “The increase in home and community based services is due in part to an effort to invest in alternatives to institutional/nursing home care.”
And here’s a chart showing the same breakdown for adults with disabilities:
10. Just 7% of Rhode Island Medicaid enrollees cost more than $1 billion a year.
This may be the most astounding fact on this page: the top 7% of Medicaid beneficiaries account for nearly two-thirds of spending on medical claims.
Put another way, out of the roughly 230,000 Rhode Island residents who used Medicaid during the 2012-13 fiscal year, on average one group of about 119,000 filed only $992 each in medical claims, while another group of about 16,000 (that top 7%) filed $66,000 each in claims.
“These high utilizes typically present with multiple, complex conditions, requiring care coordination across a variety of providers,” the executive office’s report explains.
Here’s a chart:
So where did all that money go? “Nearly half (49%) of claims expenditure on high cost users is on nursing facilities and residential and rehabilitation services for persons with developmental disabilities,” the report says. It also says: “Many high cost users are those who are institutionalized year-round.”
Here’s a chart on that:
11. Officials say Medicaid is a key reason Rhode Island faces large deficits.
The House Fiscal Office is projecting a larger budget shortfall in each of the coming fiscal years, according to these estimates provided to state lawmakers last month:
12. Growing Medicaid costs are a key concern to state officials.
The same House Fiscal presentation singled out Medicaid for growing far faster than state revenue:
Federal Grant Clears Way For Design and Implementation of Health-Benefits Computer System
On October 19, 2015 the State of Rhode Island announced it has received an additional $112.8 million in federal funds for a new computer system. The system, whose overall cost has soared to $380 million, is being built to verify eligibility for Medicaid, tax credits for HealthSource RI and other public assistance.
The expectation with the new computer system is that it will allow all future applications for benefits to be completed on-line, allowing for better tracking and controls. Currently, if a person wishes to apply for Medicaid the application is done via a booklet with multiple pages of supporting document all needed to accompany the application. In the near future, applications will be able to be submitted electronically and all supporting documents will be scanned and attached to the application, reducing time and errors.
Still have questions as to Medicaid qualification and benefits? Contact our office for a free consultation.
For 2016, the Internal Revenue Service has announced that the estate and gift tax exemption is $5.45 million per individual, up from $5.43 million in 2015. That means an individual can leave $5.45 million to heirs and pay no federal estate or gift tax. A married couple will be able to shield $10.9 million from federal estate and gift taxes.
The annual gift exclusion for 2016 remains the same at $14,000.
Why is this important? Most people have a desire to pass as many assets as they can to their heirs. When deciding on your estate plan, knowledge as to what portion of your estate, if any, may be subject to estate taxation is critical in deciding on a plan.
My assets are below the 2016 threshold, should I still be worried? Maybe. Even though the you may be below the Federal level, you may be above the levels taxed by each state. For example, the State of Rhode Island has set a limit of $1,500,000 before an estate tax is due; Massachusetts is even worse being set at $1.0 million. Other states, such as Florida and New Hampshire do not impose any estate tax.
Still concerned and confused about estate taxes? Contact us for a free consultation.
Special Needs Trusts – Choosing the Right Option – Excerpt from an October 9, 2015 Seminar
Self-settled special needs trusts were authorized by Congress in 1993.The language in the statute is very brief, but raises many issues. “A trust containing the assets of an individual under age 65 who is disabled (as defined in §1614(a)(3)) and which is established for the benefit of such individual by a parent, grandparent, legal guardian of the individual, or a court, if the state will receive all amounts remaining in the trust upon the death of such individual up to the amount equal to the total medical assistance paid on behalf of the individual under a state plan under this title.” Most commonly, self-settled special needs trusts are required in connection with personal injury settlements, but can also be used when a disabled individual receives an inheritance, or is receiving equitable distribution, alimony, or child support.
The purpose of the self-settled special needs trust is to enable the beneficiary to maintain or obtain eligibility for means-tested public benefits such as SSI and Medicaid. Trusts may also be used when the beneficiary is receiving SNAP (formerly Food Stamps) or Section 8 Housing. Beneficiaries receiving SSDI and Medicare do not require a special needs trust, because these benefits are insurance-based rather than means-tested.
Means-tested public benefits have income tests and many, such as SSI and Medicaid, have asset tests. An individual with disabilities who receives the proceeds of a personal injury settlement, an inheritance, equitable distribution, alimony, or child support is likely to be in a financial position that exceeds the income or asset test limit for any given means-tested program. By placing the assets in a properly-drafted self-settled special needs trust, the assets are non-countable. If the trust is administered properly, distributions from the trust on behalf of the beneficiary are generally not considered income.
For some beneficiaries, the SSI payment, Food Stamps, or Section 8 Housing subsidy is important; for most of the beneficiaries, however, the Medicaid benefit is absolutely critical. By placing funds in the self-settled special needs trust, the individual is able to maintain important needs-based public benefits while at the same time enjoying the benefits of the settlement, inheritance, equitable distribution, alimony, or child support.
Clients are often confused as to what they can do for a disabled child or loved one. Many may have some level of experience or knowledge, having associated with many other individuals who they themselves have disabled children. The conversations and preconceptions as to what can be done based on these conversations with friends and acquaintances can be both a blessing and a curse. The blessing is in that they may have a better than average understanding that there are options to protect assets on behalf of the disabled beneficiary, the curse is that there may be a significant amount of misinformation that you may need to navigate through before a client agrees to a specific course of action.
Assessing the Degree of the Beneficiary’s Current and Future Disability Needs.
The purpose of a Special Needs Trust is to see that the money intended for the beneficiary goes to the beneficiary without jeopardizing her or his eligibility for government benefits (e.g., SSI, Medicaid, and Social Security). Secondly, it serves to protect the money from being squandered or inappropriately spent.
In a Special Needs Trust, the trustee has the duty to use the funds to pay for expenses of the beneficiary that supplement (not replace) benefits received from various governmental assistance programs. These “special needs” might include:
Fees for attending special-needs facilities.
Insurance
Rehabilitation
Medical and dental expenses.
Eye glasses.
Transportation
Automobile
Computers and electronic equipment.
Vacations
Athletic training and competitions.
Companion services/home health assistance.
Other items to enhance self-esteem.
Training programs.
Maintenance
Education
Entertainment
The Special Needs Trust is a type of discretionary trust in which the trustee is given the power to manage assets in the trust (e.g., to invest trust funds and to sell assets) and the discretion to use trust assets for the benefit of the person with special needs. Trust assets can be in the form of cash, stocks, personal property, and real property. The trust also can own or be the beneficiary of life insurance. [1]
Knowing these options is critical to understanding the drafting and advice you provide a client. If you have a beneficiary that is incapacitated and will remain institutionalized for the remainder of their lives then the Special Needs Trust can be used just as a fallback for the beneficiary as there is little to no likelihood that the beneficiary will be able to use the resources in a manner that materially enhances their life enjoyment. If on the other hand the beneficiary is able to enjoy any of the above referenced activities then the client and the beneficiaries will enjoy the Trust.
[1] “Planning For The Long Term Care Of A Special Needs Individual”, J. David Spiceland, CPA and Craig J. Langstraat, LL.M., Practical Tax Strategies, Volume 73, Number 03, September 2004.
gift tax. A married couple will be able to shield $10.9 million from federal estate and gift taxes.
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