While we much prefer to plan for our clients years before they need in-home care, assisted living, or skilled nursing care, many of our clients seek our services after the senior has been admitted to the hospital and is being transferred to a skilled nursing facility, rehabilitation hospital, or assisted living facility. Crisis planning of this type is much more difficult for our firm and for our clients because of the limited time under which we must work and the added stress of dealing with hospital administrators, assisted living staff, and panicked relatives.
Long Term Care Medi-Cal
For those seniors being transferred to a skilled nursing facility or rehabilitation hospital, Medicare only pays for the first 20 days of care. There is a share of cost between Medicare and the senior starting on the 21st day of care. Medicare will no longer pay any part of the care costs in a skilled nursing facility or rehabilitation hospital after 100 days of care.
Seniors looking at a long-term stay in a skilled nursing facility often seek assistance through Long-Term Care Medi-Cal. There are asset limits for qualification. Certain assets are exempt. They are the residence, one car, IRA and other retirement plans, life insurance with a cash value less than $1,500, prepaid burial plans and personal jewelry, furniture, furnishings, and clothing.
All other assets are available resources. These include checking accounts, savings accounts, money market accounts, certificates of deposit, annuities, vacation homes and rental properties. For an unmarried person wanting to qualify for Long Term Care Medi-Cal, available resources cannot exceed $2000.
The rules are different for married couples. The community spouse (the spouse not in the nursing home) can retain his or her CSRA or Community Spouse Resource Allowance. The CSRA for 2018 is $123,600. He or she can also retain the exempt resources described above. The spouse in the nursing home can have no more than $2,000.
If resources exceed these limits, the senior in the nursing home will be ineligible to qualify for Medi-Cal. At that point, an individual or couple must engage in Crisis Planning. This may involve the individual or couple privately paying for skilled nursing home care for a period of time. The excess available resources must be spent, repositioned into exempt resources, or transferred out of ownership by the individual or couple. The transfer is usually accomplished by utilizing an irrevocable trust.
Transfers of assets for the purpose of qualifying for Long-Term Care Medi-Cal are subject to penalties. The penalty is based on the amount of assets transferred and the Average Private Pay Rate (APPR) at the time of transfer. The APPR for 2018 is $8,515. For example, if a senior transferred $100,000, he or she would be subject to a penalty of 11 months ($100,000 / $8,515 = 11.74 (rounded down to 11 months)). This means the senior would be ineligible to qualify for Long Term Care Medi-Cal for 11 months from the date of the transfer. When applying for Long Term Care Medi-Cal, the senior would be asked to disclose, under penalty of perjury, any uncompensated transfers he or she has made during the previous 30 months. This period of time is called the Look Back Period. If the senior transferred the $100,000 over 30 months ago, he or she would not need to disclose the transfer and assuming he or she is otherwise eligible to apply for Long-Term Care Medi-Cal, he or she should be approved. If the transfer occurred less than 30 months ago, but over 11 months ago, the transfer would need to be disclosed but the senior should be approved for Long-Term Care Medi-Cal. If the transfer occurred less than 11 months ago, the senior will be denied eligibility for Long-Term Care Medi-Cal. He or she must private pay for the nursing home until after the 11 months penalty period has expired. Many legal planning strategies can be employed to reduce or eliminate the penalty period. These strategies can be very complicated and you should consult with a qualified elder law attorney prior to engaging in any of them.
Once the excess available resources have been eliminated, the senior can apply for Long-Term Care Medi-Cal and should be approved. At that time, the senior may be liable for a share of cost. If the senior is unmarried, his or her income will be paid to the nursing home minus a $35 personal needs allowance. If the senior is married, the calculation of the share of cost is more complicated. It is even possible that the community spouse may not have a share of cost and can use the couple’s joint income to pay his or her living expenses. In no case would a community spouse be obligated to pay his or her income towards the cost of the nursing home.
Veteran’s Aid and Attendance Benefits
If the senior is in an assisted living facility there is no government assistance available other than the Medi-Cal Assisted Living Waiver program, which is very difficult to qualify for. If the senior is a veteran or widow of a veteran who served during a war time period, he or she may be eligible for enhanced pension or Aid and Attendance benefits. To qualify, the veteran must’ve been honorably discharged and serving in one of the military services during one of these time periods:
- WWII – 12/7/1941 – 12/31/1946
- Korean War – 6/27/1950 – 1/31/1955
- Vietnam War – 8/5/1964 – 5/7/1975
- Gulf War / Iraq Conflict – 8/20/1990 to present
The veteran has only to have served during these time periods, not actually fought in the war.
The asset qualification is very similar to that for Long-Term Care Medi-Cal, except there is no CSRA amount for spouses, available resources must be less than $80,000, and there is no penalty at this time for transferring assets to qualify for the benefit. If the veteran has excess assets, he or she can engage in legal asset preservation strategies much like those for Long-Term Care Medi-Cal. Often in a crisis situation, our office is planning to qualify the senior for both VA and Long-Term Care Medi-Cal benefits. As with Long-Term Care Medi-Cal, the planning strategy often involves transfers of excess assets to an irrevocable trust.
Once qualified for VA Aid and Attendance benefits, the veteran or his widow may qualify for as much as $1,176 – $2,903 per month to pay for assisted living facility expenses. The benefit amount depends on the income of the veteran (joint income if married) or widow, the cost for assisted living and other healthcare related expenses, and the marital status of the person in the assisted living facility. The maximum monthly benefit for widows is $1,176. The maximum monthly benefit for a married couple where one spouse is a veteran is $2,169. The maximum monthly benefit for an unmarried veteran is $1,830.
You Are Not Alone –We Are Here to Assist With Your Riverside Crisis Planning
If you are the spouse of an individual who is being transferred to a nursing home, or the child of a parent searching for alternatives to pay for caregiving services, including assisted living expenses, contact our Riverside office to schedule a consultation to learn your Crisis Planning alternatives. You may have been told that the only alternative is for the senior to privately pay for the services, but that is not necessarily true. But you must call to discover the truth. To find out how we can help you with your Crisis Plan, contact us online or call our office at 951-888-1460