What is a Medicaid Crisis?
A Medicaid crisis is a situation where a person unexpectedly requires full-time care immediately, either in a nursing home setting or at home with an aide, but has been told that he or she is not eligible for Medicaid benefits to pay for it. Given the high cost of long-term care, this is indeed a financial crisis for all but the wealthiest of families. Many families exhaust their assets within a year or two of a family member falling ill. The good news isthat we can assist you in determining the best options for care, help you qualify for Medicaid assistance to pay for your care either at home or in a nursing home, and in the process, protect a portion of your hard-earned life savings.
The Cost of Long-Term Care in a Nursing Home
If you have spent even a small amount of time investigating nursing home costs, you are likely in a state of shock. According to Genworth’s Cost of Care Survey, the median annual cost of a private room in a nursing home was nearly $106,000 in 2020. This was for the United States as a whole. In the state of New York, the median annual cost was more than $155,000. These costs are expected to rise dramatically in the future. In addition, advances in medical science have helped us live longer than ever before. This translates into many people requiring long-term care for extended periods of time, with increasingly higher rates.
Paying for Nursing Home Care: The Difference Between Medicare and Medicaid
Medicare, by and large, does not cover long-term nursing home care. For example, Medicare Part A will only cover up to 100 days in a skilled nursing facility for a particular illness, and only after the patient has first spent at least three days in a hospital. Worse, from day 21 to day 100, an individual in the skilled nursing facility must make a copayment of $185.50 per day*. Few people actually receive Medicare coverage for the full 100 days, in part because of the copay, and in part because restrictions and conditions for coverage are quite stringent.
Medicaid, on the other, does cover long-term nursing home care for people who meet its income and asset limits. 100 days, one year, five years—Medicaid will pay for the care as long as the recipient is eligible. Given the high cost of nursing home care, the dearth of affordable alternatives, and the restrictions inherent in Medicare coverage, Medicaid is now the single largest payer of nursing home stays in the United States.
Medicaid in New York State
So, can you get assistance from Medicaid to pay for nursing home care or long-term care in a community setting? There are several different Medicaid long-term care programs for which New York residents may be eligible. These programs have differing functional and financial eligibility requirements, as well as varying benefits. Eligibility for these programs is complicated because the criteria vary with marital status and New York offers multiple pathways toward eligibility. The bottom line is this: If your income and assets exceed state limits, you have to take the appropriate steps to become eligible. The sooner you take these steps, the better, and you have to be careful.
For example, you can’t simply give your belongings away a few weeks before entering a nursing home and expect Medicaid to pay for your stay. When you apply for Medicaid, any gifts or transfers of assets made within five years of the date of application are subject to penalties. This is known as the look back period. And what is the “penalty?” It is the amount of time during which the person transferring the assets will be ineligible for Medicaid. The penalty period is determined by dividing the amount transferred by what Medicaid determines to be the average private pay cost of a nursing home in New York.
For those New Yorkers in need of Medicaid assistance at home, a new look back period for Community Medicaid is slated to take effect as early as January 1, 2022. (The start date for the look back period has been delayed several times and could be delayed again.) This means that the same penalty period analysis for nursing home coverage caused by asset transfers also may apply to home care Medicaid.
Given the complexity of the rules governing Medicaid eligibility in New York, together with the penalties for becoming eligible through improper means, it is important to seek assistance from a qualified elder law attorney. Michael Amoruso is a past-chair of the Elder Law Section of the New York State Bar Association and he is past-president of the National Academy of Elder Law Attorneys. He regularly interprets the program and policy manuals, which contain nuanced information about the application process. Furthermore, he works with area facilities to achieve superior results for both our clients and the facilities. From the facility, case manager, financial planning, agency, and legal professional perspectives, our reputation is unmatched.
At Amoruso & Amoruso LLP, we are at the forefront of creating strategies and instruments to help seniors obtain the long-term care they need without exhausting their life savings. If you or a loved one is faced with a Medicaid crisis, there is no time to lose. We will give your case the immediate attention it deserves and help you obtain Medicaid assistance as quickly as possible, whether in a nursing home setting or in your own home or at an assisted living facility. Contact us at your earliest convenience to discuss your particular situation, needs, and goals.
* This amount is for the year 2021. The Medicare co-pay is adjusted annually.