Medicaid and Assisted Living: What is the Answer?

Should All States Permit the Use of Medicaid for Assisted Living?

Medicaid Assisted LivingThe question of using Medicaid funds for assisted living is a big one for many in the elder care field. As we have discussed before, Medicaid is a joint state and federal program. The federal law lists broad eligibility rules, The states will get roughly half of the Medicaid expenditures reimbursed if they do not make their eligibility rules stricter than the federal law.

Pennsylvania is in compliance, and in some cases, is more generous than the federal rules. The federal nursing home Medicaid payment rules are intended only to provide funds for eligible residents receiving nursing care. Pennsylvania, like most states, has sought a waiver from that federal rule seeking to use the nursing home funds for home and community based services. What has not occurred is the use of these funds for assisted living or personal care residents which is likely available under the Waiver program or with a quick application.

With Medicaid, Many Older Adults Would Thrive in Assisted Living

Often older adults who would qualify for nursing care but would thrive in a less restrictive environment like an assisted living community are forced into the nursing home because they run out of funds. Some states, like New Jersey, allow Medicaid funds to be used for this less restrictive level of care, resulting in lower costs to the government and better quality of life for the resident. Pennsylvania has assisted living regulations that intend such a result but the regulations are so restrictive and inappropriate for senior communities that very few choose to seek licensing as an assisted living. Further, even for those that have this licensing, there has yet to be a dollar of Medicaid funds released to any of the licensees.

Part of the problem, it appears, is that the rules on assisted living licensing in PA requires facilities to put certain amenities in the room that work for the disabled community but could place impaired elders at risk (like cooking facilities). But I do not think that is the only reason (as conceivably those amenities could be disabled for a demented resident). The bigger issue is that before communities are going to staff of and put large amounts of money out for assisted living licensing, the state must actually honor its promise and make the funds available. Thus far PA has not done this.

It would seem (from my simplistic perspective) that allowing properly licensed assisted living communities to receive Medicaid funding would reduce the stress on nursing homes by making more beds available for rehab and allow people who are impaired but could function at a higher level enjoy a higher quality of life in a less institutional atmosphere and save the taxpayers money.

About The Author

Named One of the Main Line’s Top Elder Law Attorneys by Main Line Today

Robert M. SlutskyRobert M. SlutskyRobert M. SlutskyRobert M. Slutsky has practiced Elder Law since 1992 and was one of the area’s first elder law attorney. Mr. Slutsky advises clients on Medicaid and Asset Protection Planning, Guardianships, Wills, Trusts, Powers of Attorney, Estate Administration, Special Needs Planning and General Estate Planning. He has represented for profit and non-profit elder care providers and the Pennsylvania Department of Aging. Mr. Slutsky has been the solicitor for the Montgomery County Office of Aging and Adult Services, the Area Agency on Aging for Montgomery County, for over 15 years.

Posted in Elder Law, Elder Law Attorney, Long Term Care Planning Tagged with: , , , , ,

Are Today’s Long Term Care Insurance Policies Right for You?

long term care insuranceThe Wall Street Journal recently ran an article Collapse of Long-Term Care Insurer Reflects Deep Industry Woes. The article focuses on “[t]wo insurance units of Penn Treaty American Corp., which have combined assets of about $600 million and projected long-term-care claims liabilities topping $4 billion,[which] are on track to be liquidated early next year, according to filings in a state court in Harrisburg.” The article explains that “a liquidation is likely to be the second-largest life-health-insurance insolvency in U.S. history by assessments, according to officials with a network of industry-funded guarantee associations. An assessment is the amount other insurers are required under state laws to pay to cover policyholders of a defunct firm.”

Why do long term care insurance policies have issues?

According to the article, “most actuaries badly underestimated costs, and the insurers then met resistance in many state insurance departments when trying to push the pricing miscalculation onto policyholders through steep rate increases. Some states did allow double-digit-percentage increases, distressing the often-elderly policyholders. Sales have collapsed amid the turmoil, and fewer than a dozen insurers sell any significant volume today.”

The reality is that when LTCi policies were introduced 30 years ago insurers were using experience in life insurance as a guide and not health insurance policies. At the time many life insurance policies had many years when policyholders paid premiums and outlived the term (term policies) or paid premiums (for cash value policies) and let the policies lapse. In either event claims were never paid. The experience with LTCi policies was markedly different than expected. Most policyholders in fact kept the policies in force, paid the premiums and a much higher percentage of insureds went “on claim”, causing much higher outlays for the insurance companies.

Further, many early policies had lifetime benefits and 5% inflation riders adding to the cost. During this early period returns on stocks and bonds (and interest rates) were markedly higher than they are today allowing companies to keep premiums lower since the return on those premium dollars was so much more than today. All of these factors contributed to significant losses for the insurance companies.

How Today’s Policies Stack Up

As an elder law attorney for 24 years my recommendations have changed. While policies are more expensive than they were at the beginning, they are generally better policies. They no longer cover lifetime benefits but in general are more helpful when you need them. While I used to be able to recommend them to a wider group of people, today I need to limit the recommendation to those who really have enough assets to protect or are very specific about the care they want when they need it. And today, unlike 24 years ago, you are less likely to have a pension so we have to consider how to pay for this policy in retirement.

You can read the WSJ article in here http://www.wsj.com/articles/small-insurers-big-collapse-reflects-deep-industry-woes-1480852801

About The Author

Robert M. SlutskyNamed One of the Main Line’s Top Elder Law Attorneys by Main Line Today

Robert M. SlutskyRobert M. Slutsky has practiced Elder Law since 1992 and was one of the area’s first elder law attorney. Mr. Slutsky advises clients on Medicaid and Asset Protection Planning, Guardianships, Wills, Trusts, Powers of Attorney, Estate Administration, Special Needs Planning and General Estate Planning. He has represented for profit and non-profit elder care providers and the Pennsylvania Department of Aging. Mr. Slutsky has been the solicitor for the Montgomery County Office of Aging and Adult Services, the Area Agency on Aging for Montgomery County, for over 15 years.

Posted in Asset Protection, Estate Planning, Long Term Care Planning Tagged with: , , , , ,

New Year Wishes

 

New Year Wishes

And Thoughts of Gratitude

I want to take this opportunity to thank all of my clients, colleagues and friends for all that you have given to me in 2016.

New Year WishesAt this time of year I look back and reflect on how lucky I have been. I am blessed to have a wonderful, loving wife and two great kids, clients who I genuinely enjoy and friends who make life that much more fun. 2016 was a busy year professionally and personally and 2017 looks to be the same. As those of us in the elder care field know, life is a marathon not a sprint. There are and have been ups and downs but when I look back I see how I have benefitted incredibly from the relationships I have developed. To my wife who has supported me through caregiving, the deaths of loved ones and other health issues. To my children who give me a reason to act better and continue to push forward when I want to stop. To the colleagues who give me perspective and knowledge in areas that I lack. I say thank you.

To my clients. I have said it before and I will say it again, I learn so much from my clients. They are the spouses, children and friends who step up to the plate and do the right thing. I am a so much better person because of the examples set by people who are going through incredibly difficult life experiences and still manage to show the best in humanity. Because of them I am a better caregiver to my mother and was able to be a better, more understanding caregiver to my father and brother when they needed it. These wonderful examples along with a solid helping of Jewish guilt have helped me become a better person by trying to come close to the generosity exhibited by these people who expect no thank you and do what’s right because it is right. I really cannot express how these relationships have affected me. I am not yet as good as I want to be but I will keep trying because of the example set by these incredible people.

2017 is likely to hold a lot of unknowns given the current political landscape. But one thing I do not is no matter what changes come down the pike, we are all in it together and that does give me some comfort. And I will go forward in that journey knowing that negativity gets nothing done and that is not the example I want to show to my children. Positive thinking alone will not change the future but positive actions will. I look forward to many positive actions going forward.

So wishing all of my family, friends, clients and colleagues a wonderful holiday season and a truly happy and healthy 2017. And I look forward to seeing, talking to and emailing you in 2017.

Posted in Elder Law

Affordable Care Act

Affordable Care Act:  Impact on Older Adults

Repealing The Affordable Care Act Will Not Only Affect the Young

Affordable Care ActOne of President-elect’s Donald Trump’s campaign promises was to repeal the Affordable Care Act (ACA), aka Obamacare, and Republicans in Congress have vowed to make the repeal one of their first acts in the new term. While repealing Obamacare will have implications for millions of younger people covered by the insurance, it will also affect Medicare beneficiaries.

For example, the ACA requires insurers to provide free preventative care coverage to Medicare beneficiaries. Without that requirement, seniors may end up having to pay for many preventative care services. In addition, the ACA reduced prescription drug costs under Medicare Part D and phased in an elimination of the infamous “doughnut hole.” The doughnut hole is the period of time in which seniors are responsible for 100 percent of the cost of prescription drugs. Under the ACA, the percentage seniors pay for drugs while in the this coverage gap was capped at 50 percent starting in 2011 and is supposed to continue dropping until the doughnut hole is eliminated completely in 2020. A little–known fact about the ACA is that it contains provisions designed to strengthen Medicare. Repealing the ACA may eliminate those provisions, potentially destabilizing Medicare. The ACA also established programs to reduce Medicare waste, fraud, and abuse. Thanks to these measures, according to the Center on Budget and Policy Priorities, the Medicare hospital insurance fund is projected to remain solvent eleven years longer than before the ACA was enacted.

These factors combined with the fact that millions of near-seniors aged 50-64 could lose coverage, leaving them in poorer health when they become eligible for Medicare, could have implications for Medicare costs.

About The Author

Named One of the Main Line’s Top Elder Law Attorneys by Main Line Today

Robert M. SlutskyRobert M. Slutsky has practiced Elder Law since 1992 and was one of the area’s first elder law attorney. Mr. Slutsky advises clients on Medicaid and Asset Protection Planning, Guardianships, Wills, Trusts, Powers of Attorney, Estate Administration, Special Needs Planning and General Estate Planning. He has represented for profit and non-profit elder care providers and the Pennsylvania Department of Aging. Mr. Slutsky has been the solicitor for the Montgomery County Office of Aging and Adult Services, the Area Agency on Aging for Montgomery County, for over 15 years.

Posted in Affordable Care Act, Elder Care Crises Issues:, Elder Law, Elder Law Attorney, Legislation, Long Term Care Planning Tagged with: , , , , ,

Medicaid block grants…again?

Medicaid Block Grant Proposal

medicaidMedicaid block grants  . . . again?  Regardless of your political persuasion it is quite evident that benefits for the older and disabled and likely to change when Donald Trump becomes president. Obviously things said during the campaign process do not always materialize. However, the appointments being made to high level positions in the administration speak loud and clear as to the direction things are likely to go.

Congressman Tom Price has been proposed as the director of HHS, the agency that oversees Medicare and Medicaid. Mr. Price has been a strong opponent of the Affordable Care Act and it appears that the law is likely to be repealed in the first 100 days of Trump’s presidency. While the Affordable Care Act is less about older and disabled individuals, there are parts of the Act that will affect the older and disabled population.

For the older and disabled, Mr. Price is likely to try to do several things that Mr. Trump did not really touch on much during the campaign. The first, which Paul Ryan has been pushing for years, is to try to make Medicare a voucher program and give older and disabled adults a voucher to purchase private insurance.

How Medicaid Block Grants Work

Not only is Medicare in the spotlight for revamp, so too is Medicaid. One major change endorsed by both Trump and House Speaker Paul Ryan would transform Medicaid from an entitlement program into a block grant program. In an entitlement program, coverage is guaranteed for everyone who is eligible. The federal government’s commitment to help states cover costs is open-ended. The states’ obligation is to cover certain groups of people and to provide specific benefits. Children and pregnant women who meet specific income criteria must be covered, for example.

Currently Medicaid is a state and federal joint program. The Federal Government guarantees to split the cost with the states as long as the states do not make Medicaid harder to obtain that broad federal rules allow. The states can be more generous with the eligibility rules but not tougher or federal matching funds will be denied. With a block grant the federal government writes a check to the state for a set amount each year and the states can then make any eligibility rules they like. So if a state is having financial difficulties it can simply make it harder to access Medicaid services to balance its budget. For a small or young state, this may be the right choice. For a state like Pennsylvania, with the third largest number of older adults in the nation and a large disabled population, this could be a disaster. A bad recession or a surge of needy people could push the budget (which is not in good shape currently) into serious disrepair because all of the financial risk is on the individual states.

We do not know how the calculation of the block grant funds would be made or if all Republicans would support such a plan. Plus if the block grant amount is calculated in a manner that the states find is unacceptable than there are always the courts to decide. Just be aware, as advocates for the older and disabled members of our society, and as older and disabled adults, you appear to be a target of the upcoming administration. Be alert, be aware and be advised so that you can properly handle the changes if and when they arrive.

About The Author

Named One of the Main Line’s Top Elder Law Attorneys by Main Line Today

Robert M. SlutskyRobert M. Slutsky has practiced Elder Law since 1992 and was one of the area’s first elder law attorney. Mr. Slutsky advises clients on Medicaid and Asset Protection Planning, Guardianships, Wills, Trusts, Powers of Attorney, Estate Administration, Special Needs Planning and General Estate Planning. He has represented for profit and non-profit elder care providers and the Pennsylvania Department of Aging. Mr. Slutsky has been the solicitor for the Montgomery County Office of Aging and Adult Services, the Area Agency on Aging for Montgomery County, for over 15 years.

Posted in Asset Protection, Elder Law, Elder Law Attorney, Estate Planning, Long Term Care Planning Tagged with: , , , , ,