Medicaid for Long-Term Care (LTC MA) is a government-funded program overseen by the state and administered at the county level. It provides financial assistance to individuals with limited income and assets to cover the costs of long-term care services, whether received at home or in a nursing facility. Eligibility is contingent upon meeting specific criteria, and a thorough examination of financial activities from the past five years is conducted before acceptance into the program. The following are frequently asked questions that arise during the application process for LTC MA coverage.

ChatGPT Upon approval for LTC Medicaid, and upon meeting both medical and financial eligibility criteria for state funding, your monthly income will be directed to the Nursing Facility (NF). This amount, after deducting health insurance premiums and a $45 monthly allowance for personal needs (referred to as the resident’s “income liability”), covers your contribution. Medicaid then steps in to cover the remaining nursing home expenses. In cases where a spouse resides in the community and relies on the applicant’s income for expenses, they may qualify for a spousal allowance. If you meet the criteria for the “Aging Waiver” (in-home care), you retain your income. However, it’s important to note that there are income limits applicable when qualifying for the Aging Waiver.

The expected daily cost for a double occupancy room is approximately $420 (equivalent to around $12,800 per month) in the year 2023.

Medicaid covers the remaining monthly expenses of the Nursing Facility (NF), including prescription costs, once the resident’s income liability and any necessary “spend-down” of assets have been subtracted. Medicaid coverage includes six haircuts per year, provided by the NF, but does not extend to cover TV, cable, or telephone expenses.

MA eligibility hinges on two criteria: Medical Need and Financial Need.

For Medical Need qualification, applicants must undergo assessment by the Department of Aging and Adult Services (AAA) to be deemed “medically needy” for either short-term or long-term care. This involves completing a medical evaluation endorsed by the resident’s primary care physician, which is then scrutinized and approved by a AAA caseworker. The nursing facility will coordinate this assessment.

In terms of Financial Need, applicants must be verified as “financially needy” by the County. This determination is based on income, assets, and is subject to a five-year financial history review mandated by the County Assistance Office.

The permissible asset limit is determined by your gross income:

If the monthly gross income is $2,742 or less [2023], the maximum asset limit is $8,000.
If the monthly gross income is $2,743 or more [2023], the maximum asset limit is $2,400.

To qualify, a qualified spend-down must be carried out until the maximum asset limit is attained.
For example:

If there is $50,000 in savings and the asset limit is $8,000, a $42,000 spend-down is required.
Note: In cases where there is a spouse in the community, additional determining factors may come into play to protect a significant portion of assets and income, if necessary.

Certainly, both spouses’ assets are revealed, but only the community (at home) spouse’s IRA accounts are excluded from the asset division. The community spouse is allowed to retain a minimum of $29,724 [2023] or 50% of total assets (whichever is greater), up to a maximum of $148,620 [2023]. Any amount exceeding $148,620 [2023] for the spouse’s share of assets is subject to the MA spend-down requirement; nevertheless, there might be alternative options for the community spouse to retain the majority of the assets.

No, your spouse retains all of their monthly income. Nevertheless, if their income proves insufficient to cover current living expenses, they may be eligible to receive a portion of the applicant’s income, up to $3,715 per month [2023], known as the spousal monthly maintenance needs (MMN) allowance. Evidence of need is necessary, and only qualified home maintenance expenses will be taken into account when assessing MMN.

Expenditure post the “need date” (retroactive Medicaid start date) is restricted to medically related expenses, nursing facility costs, or placement in an irrevocable burial trust.

However, preceding the “need date,” you have the flexibility to pay any legitimate expense if there is a spouse at home or if you have intentions to return home. Gifting, however, is not allowed. This implies that as long as Medicaid coverage is not required during the spending period, you can continue to cover any valid expenses incurred. During this timeframe, there might be additional opportunities to preserve assets, but careful adherence to regulations is crucial, particularly within the 5-year look-back period preceding Medicaid qualification. Seeking advice from a professional well-versed in LTC MA regulations is recommended.

The amounts differ based on the County; approximately $22,000 for Montgomery, $21,000 for Bucks, and $20,000 for Lehigh [2023]. These figures apply to both the applicant and the spouse. The required arrangement is an irrevocable burial trust established with a funeral home or a chosen banking institution. The funds in this trust cannot be withdrawn until after the resident’s passing and are exclusively designated for funeral and burial-related expenses.
All your investments contribute to your overall “allowable asset limit.” If the sum of your investments, along with your total liquid assets, falls below the allowable asset limit, you are permitted to retain them. However, should the combined value of liquid assets and investments exceed the allowable limit, it is necessary to liquidate the investments and undergo a spend-down before qualifying for Medicaid. Exceptions include the community spouse’s retirement accounts and investments generating a monthly income, which are exempt from this requirement.
Indeed, one house and one automobile are excluded from the total asset calculation unless they are liquidated. However, it is imperative to disclose them on the MA application, and a copy of the deed and title must be furnished. In cases where there is no community spouse, and the resident does not intend to return home, the County will anticipate the sale of the home. Once the home is sold, the MA recipient will be disqualified from receiving Medicaid until another spend-down is executed, bringing total assets below the resource maximum for MA qualification.

Certainly, but only the “cash surrender value” applies if the face value is over $1,500. This implies that if the face value is $1,500 or less, it will not be considered part of your total assets. However, any life policy with a face value exceeding $1,500 and a cash value surpassing $1,000 would be included in your “total assets.”

It’s important to note that the cash value differs from the face value of the policy and is usually lower. This represents the amount you would receive if you discontinued coverage and closed the policy, distinct from the amount payable upon death. For example, a $20,000 Life Policy with a $5,000 cash value would count as $5,000 towards your total assets.

The state aims to verify that there were no questionable activities within the 5-year look-back period that may suggest gifting of funds. This encompasses cash, investments, as well as sales of property and automobiles. A transaction is deemed valid only if “fair market value” is received for any asset liquidated or transferred to someone other than the spouse.

In case of unverifiable or inadequately explained large withdrawals (amounting to $500 or more) or any transactions involving investments, title transfers, or deeds without receiving fair market value, the State may impose a penalty period. During this period, the State will not cover Long-Term Care (LTC) expenses, equivalent to the duration the “gifted” funds would have covered. Consequently, you will be responsible for paying the full private pay amount incurred during this timeframe.

If it is determined that you cannot afford the private pay rate to the Nursing Facility (NF) for covering the penalty period, there is a risk of the resident being discharged from the nursing facility, and collection proceedings will commence.

Kindly consult the “List of Documents Necessary for MA Application” provided below.

The determination of acceptance might take a few months. Following the completion of the initial application review and the signing of all necessary forms and consents by the resident or Power of Attorney (POA), it may take several weeks to gather all the required documentation. Obtaining support documentation is the responsibility of the resident, POA, or family.

Upon submission of the application, the County has a 30-day period to review and verify financial information. Based on their findings, they may request additional documentation for specific items before making a final acceptance decision.

In the event of a denial of your application, the County will provide a list of reasons. Denials usually result from either missing support documentation or the identification of newly discovered assets not reported in the original application.

Upon receiving a denial, you have the option to file an appeal, allowing the application to remain open until the issues are resolved. Support documentation must be submitted to the County for each item mentioned in their denial, in anticipation of the scheduled hearing. During the hearing, the Judge will determine the next course of action.

Your coverage will persist as long as you are in a Long-Term Care (LTC) facility and remain financially in need of coverage. It is possible to transfer this coverage to another nursing facility, provided the resident was not discharged home. However, the County mandates an annual renewal (also known as redetermination) of financial need on the anniversary of your coverage.

To ensure compliance with the maximum asset limit, current statements for all financial/investment accounts, including pension and annuities (unless previously documented as “fixed, lifetime” income), must be submitted. Additionally, disclosure of any liquidated assets is required. If the resident is discharged home, LTC Medicaid coverage will terminate, or it can be transferred to a LTC Waiver program (Aging Waiver) for part-time care at home.

After determining the effective date (commencement of coverage) for Medicaid, any valid expense may be paid before that date (refer to #9 above); however, payments of $500 or more will necessitate verification. Subsequent to the initiation of the Medicaid effective date, which might be retroactive, any expense paid that doesn’t qualify as part of the spend-down (#9 above) will be subtracted from your allowable asset balance ($8,000 or $2,400 balance, as outlined in #5).

List of Required Documents for Medicaid Application

Below is a list of support documents required for the typical PA LTC Medicaid application for both applicant and spouse. There may be additional information required based on individual circumstances.

1. IDENTIFICATION: Any available ID – Driver’s License (current or expired) / SS, Medicare, Insurance cards, etc.. If applicable, Divorce Decree, spouse’s death cert..

2. POA/CONSENT: Provide copy of Power Of Attorney, Guardianship or Consent Agreements (if applicable).

3. INCOME: Provide proof of income (i.e. Soc.Sec. Award Letter, Pension/Annuity Stmnt.), etc. that outlines gross vs. net income; copies of 1099s are acceptable.

4. FINANCIAL STATEMENTS: Provide copies of financial statements for all accounts (active or closed) within the past 5 years (i.e. Bank accts., investment accts., retirement/IRA) including opening and closing statements, if account was opened or closed within the past 5 years.
Typically, the Counties only require 2 statements per year (ex. Jan/June) for the first 3 years of the look-back period, and all monthly statements for the past (most recent) 2 years. However, they can request additional statements, for any reason, during their review process.

5. CHECK COPIES, SUPPORT DOCS.: Provide copies of cancelled checks and explanations for all transactions $500 or more (excluding income) reflected on the statements provided (#4 above). Include copies of contracts for payments to private parties (if applicable).
Note: A reoccurring expense over $500 only requires one copy of a current cancelled check (i.e. rent, mortg., utilities, insurance) as proof of routine expense.

6. LIFE INSURANCE: Provide a current insurance policy statement listing current Face Value and Cash Surrender Values.
Note: $1,000 of life cash value is an allowable asset exemption, but still requires documentation.

7. BURIAL TRUST: Provide a current statement from the bank or funeral home listing account balance and date established. Must be an “irrevocable burial” to qualify as an exempt asset.

8. REAL ESTATE OWNED: Provide a copy of the Deed and estimated property value. If applicable, provide the names of individuals living on the property and their relationship to the property owner. If sold within the past 5 years, must also provide a copy of the settlement sheet.
Note: Ownership of a primary residence is an allowable asset exemption, but still requires documentation.

9. AUTO/MOBILE HOME: If the title to a vehicle or mobile home is in the applicant’s name, provide a copy of the Title and current value, along with proof of insurance coverage.
Note: Ownership of one auto is an allowable asset exemption, but still requires documentation.

10. EXPENSES: If applying for a short term MA grant (less than 6 mos.) or if there is a spouse in the community (at home), provide copies of all monthly expenses; Mortg./Rent/Elec./Water/Sewer/Phone (basic)/Gas/Trash/Property Taxes/Home Insurance, to be considered for a home maintenance deduction.
Note: Applicants that are single and not returning home, do not qualify for a home maintenance deduction and copies of expenses are not required.

11. FEDERAL TAX RETURNS: Provide copy of tax returns for the past 5 years, include copies of 1099s (if applicable). If no taxes were filed, a “non-filing” disclosure must be signed.

12. HEALTHCARE PREMIUM INVOICE: If resident or spouse has a supplemental or managed Healthcare premium (other than regular Medicare), provide a copy of a recent premium invoice.

• Do I qualify (for Medicaid) • How do I qualify (for Medicaid) • What do you do when Medicare runs out? • Do I have to privately pay for (the home) • How to afford (long-term care facility) • how to pay for long-term care • Payment assistance in nursing home • how to pay for long-term care without insurance • What happens to senior citizens when they run out of money? • Parent care options • Elder crisis planning • What to do with elderly parents • Estate attorney • How to pay for a nursing home • How much do most nursing homes cost a month? • Nursing home negligence ** • Medical assistance attorney/lawyer** • What is a spenddown • 5 year look back • Intentional gifting • Penalties • Irrevocable trust • Irrevocable burial • Reverse mortgages and Medicaid • What Are Medicaid Qualifying Events? • Certified Medicaid Planner

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