Update on Privatized Medicaid

Six months ago, I wrote about the changes in how long-term home care services will be delivered to the elderly in New York: Managed (“privatized, for profit”) Medicaid. The new system has begun, and it is important that those in need of care at home and their families understand the differences between the old and new systems. This change applies to persons over 21 who are on both Medicare and Medicaid (“dual eligible”) and receive more than 120 days of home care services.

The change began in New York City in October, 2012, and in Nassau, Suffolk and Westchester counties in the past few months. Although the County Departments of Social Services continue to determine an applicant’s financial eligibility for Medicaid, once that approval is made, the applicant is required to enroll in a private Managed Long Term Care (MLTC) plan. The MLTC company is responsible for coordinating the home care services.

The MLTCs have contracted with home attendant vendors to provide the needed services. The Medicaid program pays the MLTCs a flat monthly amount per person for home care services, regardless of the number of hours of care provided. Since the MLTCs and the vendors are private, for-profit entities, there is a real concern that the MLTCs will seek to maximize profits by approving as few hours as possible for home care and by reducing reimbursement rates for the home attendant vendors.

Existing and new recipients of Medicaid for long-term care services at home will need to choose an MLTC or be automatically enrolled in one. Notices and enrollment packets are being sent to new home care Medicaid recipients. It is expected that existing recipients will be receiving the notices and packets during the next several months. It is recommended that recipients obtain expert advice before choosing, since the procedure at this time is more complex than simply choosing a plan.

Once a recipient is enrolled in an MLTC, a nurse or social worker from that plan will visit and evaluate the recipient and recommend the amount of hours of home care to be approved. If the recipient does not agree with the decision, he or she must navigate a grievance and internal appeal process within the plan. After a final determination, the recipient may appeal the decision to the State Department of Health in what is known as a “fair hearing”. A recipient dissatisfied with that decision has no alternative but to file a lawsuit (as in the former process).

An important safeguard in the appeal process is that the MLTC plan must continue providing services at the current level for up to 60 days if a request is made within 10 days after the MLTC sends a notice of intention to reduce benefits. This continuation request has certain requirements, but if it is done correctly, the plan may not reduce the level of benefits, such as hours of care provided, until there has been a final determination.

Of course, recipients will want to choose a plan in which their providers participate. Links on the State Health Department’s website can help recipients and their families determine what services different MLTC plans offer. The site also has listings of the types of plans offered, a directory of plans and performance reports. The link can be found at http://www.health.ny.gov/health_care/managed_care/choosing.htm.

The new system will allow recipients to change plans. The change will be effective the first day of the month following the month in which the request is made, provided that the request is made before the 19th of the month. Making a change is not expected to be difficult. However, since the process is new, only time will tell if problems will arise.

As I suggested above, it is anticipated that the for-profit MLTCs will be inclined to limit services in order to make money. Since they are being paid a fixed amount per recipient, they obviously have a direct financial incentive to provide less care. The process of obtaining adequate care and keeping it has become more complex. Since each particular case has its own unique facts, the reader is cautioned that the above summary cannot be considered legal advice and should consult with an appropriate legal advisor. As this new program is implemented, you may expect to see further updates.

©2013 Joseph A. Bollhofer, Esq. All rights reserved.

Editor’s Note: Joseph A. Bollhofer, Esq., is an attorney who practices law in the areas of elder law, including asset transfer and medicaid applications, estate and business planning and administration, including wills and trusts, personal injury and real estate. He is a member 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 and businesses since 1985 and is admitted to practice law in New York and New Jersey. His office is located at 291 Lake Ave., St. James. (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.