Changes to Community Care Medicaid Are Coming
By Joseph A. Bollhofer, Esq.
During the past few months, we have suffered, and continue to suffer, pain, confusion and changes to our lives on a scale that almost none of us has ever experienced. While we focus on just getting through all this, a significant amendment to New York’s Social Services Law occurred with the passage of the New York State budget in early April. It has received little attention, but will have an adverse impact on many of the elderly and their families.
Effective for all Medicaid applications filed October 1, 2020 and later for “community-based long term care services” (outside of a nursing home, such as home health care services), New York State will assess a penalty for gifts made by the applicant or spouse (“uncompensated transfers”) during the 30 month period immediately prior to the month of the Medicaid application.
This is known as a “look back period”. For those of you who don’t know, for many years the look back period for asset transfers in nursing home Medicaid applications has been 60 months. In other words, if you or your spouse gave away anything during the 60 month period immediately prior to the month that you make a nursing home Medicaid application, you will be ineligible for Medicaid coverage for a certain period of time. That period of time depends upon the value of the assets that were gifted.
However, in New York State there has been and currently is no look-back period for Medicaid eligibility for community care. Therefore, for example, you could gift all of your assets to anyone by the end of a month and effective the next month you would be eligible for Medicaid coverage for care at home to the extent that you need it, and subject to, potentially, part of your income being used for that care. The limit of nonexempt assets that you are allowed to keep and still be eligible for Medicaid, either at home or in a Nursing Home, currently is $15,750.
As with nursing home Medicaid eligibility, there are certain exemptions that will apply and not create a penalty, including transfers to a spouse, to a disabled or blind child, or to a trust for the benefit of that child.
However, there are issues that still must be clarified, hopefully soon, by State Health Department regulations or other guidance. A major issue is whether the penalty period will be phased in, as it was in 2006 when the law changed with regard to asset transfers related to nursing home applications. Another major question is whether this new law will apply only to transfers made after October 1, 2020.
The new statute amends the section of the state Social Services Law that contains the definitions and sections relating to the 60 month penalty period regarding nursing home Medicaid applications. Although it might not have been intentional, one possible interpretation of this amendment is that the new statute regarding the 30 month look back period relates to all “transfers made on or after February 8, 2006”, which is the preface to that entire section.
Legal representatives and advocacy groups are attempting to obtain a clarification from the State as to whether an uncompensated transfer made before Oct 1, 2020 will affect eligibility in the case of a Community Care Medicaid application filed on or after October 1, 2020. As of this writing in early May, that clarification has not yet come. I will give an update on this issue once it has been resolved.
The law also permits the State director of the budget to delay the effective date for up to 90 days after the termination of the Governor’s executive order that declared a state disaster emergency.
Several other changes to the Medicaid Community Care rules in New York were made in the new law, some of which will become effective October 1, 2020, and some of which became effective April 1, 2020. They are beyond the scope of this article, but they also can have potentially important impacts on how the Medicaid program is administered. Suffice it to say that if you are considering applying for Community Care Medicaid, or planning for that possibility, now would be a good time to seek legal assistance so that you will be as prepared as possible.
Copyright 2020 Joseph A. Bollhofer, Esq.
Editor’s Note:
Joseph A. Bollhofer, Esq., is an attorney who practices law in the areas of elder law, Medicaid, estate and business planning and administration, and real estate. He is a member of the National Academy of Elder Law Attorneys, and of the Elder Law, Real Property, and Surrogate’s Court Committees of the Suffolk County Bar Association and of the Elder Law and Real Property Law Sections of the New York State Bar Association. He has been serving area residents since 1985 and is admitted to practice law in New York and New Jersey. His office is located at 291 Lake Ave., St. James, NY. (584-0100). For reprints of this article and others concerning Medicaid, Elder Law and Estate Planning, send a request to info@bollhoferlaw.com or visit www.bollhoferlaw.com.