Medicaid Coverage for Home Care: 30-Month Lookback and Transfer Penalty Will Start, But When?

by Joseph A. Bollhofer, Esq.

            Much has happened during the past two years. The various Covid viruses have changed several aspects of our lives, some permanently. One other effect is the delayed implementation of several amendments to Medicaid laws and regulations.

            If it were not for federal Covid-related legislation, and New York executive orders, both recognizing a public health emergency (PHE), we would be in the midst of a 30-month lookback period for home care Medicaid applications and the implementation of penalties for gifts made on or after October 1, 2020. Two years ago I wrote:

“The new law states that, effective for all Medicaid applications filed October 1, 2020 and later for community [home care] Medicaid, 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. The DOH (NYS Department of Health) representatives recently clarified that the penalty will only apply to transfers made on or after October 1. The 30-month lookback period reportedly will be phased in.”

            Similar to the 60-month lookback period applicable to nursing home Medicaid applications, the lookback and potential penalties for home care (technically known as Community Care) applications will delay Medicaid eligibility. For background information regarding this change, please see the following articles on my website: “Changes to Community Care Medicaid Are Coming” and “Impending Community Care Medicaid Changes – An Update”.

            We now have some guidance as to when the home care lookback period could possibly begin, including two federal Covid-related laws:

The Families First Cares Act  (FFCRA)  prohibits States from restricting eligibility for Medicaid until the end of the quarter in which the Public Health Emergency (PHE) ends. The federal government has stated that states will receive 60 days advance notice before the PHE ends.  The PHE was last extended  until Oct. 15, 2022. Since we are now past August 15, 2022 and no 60-day notice was given, it is expected that the PHE will be extended at least until January 15, 2023. In that case, the  lookback could not be implemented until April 1, 2023, which would be the end of the quarter in which the PHE ends.

The American Rescue Plan (ARPA) also says states cannot restrict eligibility for home and community based services (HCBS) until the date by which they spend the federal ARPA funds  or March 31, 2025, whichever comes first. Since implementation of the 30-month lookback would restrict eligibility for these services, this law applies as well. It is expected that these funds will cover various eligible costs through December 31, 2024.

In addition to these restrictions affecting when the 30-month lookback can begin, the DOH also must make a request to the federal Centers for Medicare and Medicaid Services for authorization for the plan changes, followed by a public comment period. The DOH also must issue regulations and guidance regarding implementation of the new law.

At this point, most experts are expecting that the 30-month lookback will not be implemented until after 2023. If the law is not changed, when it begins, applicants will need to provide records of all assets that they or their spouse own or owned during the lookback period. Medicaid applications often are denied because of failure to provide documentation. Therefore, as with nursing home applications, it is extremely important to keep careful, chronological records of all accounts and other assets, including canceled checks.

It is also important to keep records of all gifts made during the applicable lookback period. A gift made during the lookback period is presumed to have been made for the purpose of qualifying for Medicaid coverage. Although it sometimes is possible to show that a gift was made exclusively for another reason, those arguments are all fact-specific and often difficult to prove.

As with nursing home Medicaid eligibility, there are certain exemptions that can 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.

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 2022 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, Trusts & Estates 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. Please note: The above shall not be considered legal advice. Please consult with your legal professional.