Keep an eye on the assets as you spend-down in the NJ Veterans Homes

At the time of admission to one of the New Jersey Veterans Memorial Homes, a worksheet is prepared based on the current values of the “accountable assets” as well as the income that is available. A home owned by the veteran is a non-accountable asset. If the home was sold, and the proceeds are kept in a segregated account, those funds are considered “non-accountable.”  However, the income generated by the assets will be accounted. DMAVA-VHM-Application

After identifying the accountable assets, a calculation is made of the veteran’s monthly obligation. Here’s the formula: Actual Care Cost minus VA Stipend = monthly maintenance fee payment obligation, less 80% of the fixed monthly income, + 12% of remaining income or $20 whichever is more = anticipated monthly spend-down from the assets.

Based on the financial evaluation, an estimate is made of how long the spend-down will last. A financial review occurs once each year.

For an unmarried veteran, $24,000 in otherwise accountable assets can be protected and retained. Once the veteran has spent down to this level, it’s important to meet with the business office to revise the calculations, because the formula changes at this point. Now, the formula is: Gross monthly fixed income x 80%, + presumed income from the excluded house account if any,  plus 12% of remaining income or $20 whichever is more (for special services fund) = gross obligation. There are then certain allowable deductions: $100 for personal needs; Medicare insurance premiums; and other health insurance premiums. The remainder is the resident’s monthly maintenance fee obligation.

Bear in mind that there are many things that the veteran is responsible to pay for on his own. The Admissions Packet contains Appendix C which is a long list of such items.Appendix C

The supplemental items and services that are listed in Appendix C will have to be paid for out of the personal needs allowance or the retained protected assets. By keeping a close watch on the spend-down and stopping at the right point, the veteran will preserve assets for the inevitable rainy day when these expenses arise.

Call for advice about nursing home admissions and applications and spend-downs … 732-382-6070

Retiree’s bump up in Social Security isn’t automatic at death of spouse

The surviving spouse of a Social Security recipient is entitled to a “bump up” in their benefits if the deceased spouse received a higher monthly benefit than the survivor was receiving. Typically, the funeral director notifies the Social Security Administration about the death.

Don’t assume that this notification suffices to preserve eligiblity for the widow’s benefit. It doesn’t.  The widow or widower still has to file an application for survivor’s benefits. It needs to be filed quickly — benefits aren’t retroactive more than 60 days prior to the date of application.  Here’s the form.

The application can only be done two ways —  in person (when Social Security offices re-open after the COVID-19 pandemic eases) or by telephone by calling 1-800-772-1213 or the local office. It cannot be done online, even though other applications are filed on line.

Social Security provide an array of benefits to surviving spouses. In addition to the potential bump up for the retiree, a surviving spouse can receive a lump-sum death benefit of $255.00 provided that the spouses were living together. A  spouse who wasn’t insured under his/her own earnings record can receive full benefits at full retirement age for survivors or reduced benefits as early as age 60. If the surviving spouse qualifies for retirement benefits on his/her own record, they can receive spousal benefits starting at age 60 and switch to their own retirement benefit without the early-receipt penalty as early as age 62. If the surviving spouse is disabled and the disability started before or within seven years of the worker’s death, s/he can receive benefits as early as age 50 based on the deceased spouse’s earnings record.

All of these potential family benefits are, of course, good reasons for workers to be “on the grid” and paying into the Social Security system.  And when there’s been a major family life incident,  contact the SSA to see what benefits are available to you and your dependents

Call us for advice on senior care planning including wills, trusts and estate administration … 732-382-6070

Save your Selfies for the Medicaid 5-Year LookBack

Readers of this blog know that when he time comes to apply for New Jersey’s Medicaid/MLTSS program for either home care, assisted living care of nursing home care, a daunting array of proofs is required. The burden to prove eligibility is placed on the applicant.  Every single expenditure made by the applicant and their spouse during the previous 5 years is open for scrutiny, to see if it was really an expenditure or if it was actually a gift to somebody else. Every check written, every auto-debit, every wire transaction, every cash withdrawal is questioned. Many kinds of transactions are presumed to be gifts unless the applicant can prove otherwise. People who share their residence with other family members may find this process particularly hard to unravel because of the intertwined sharing of expenses. People who never managed the applicant’s affairs but are now stepping in may find it impossible to answer the hundreds of questions that are posed to them by the agency.

So save your selfies, save your receipts, save your letters and invoices and proofs that you took trips and excursions. Take pictures of your big purchases, and pictures of your caregivers. Keep detailed records of everything, as well as copies of all financial records and cancelled checks. Find your insurance policies, deeds, mortgage payment receipts,  and keep them with these records. Make sure your “trusted someone”  knows where they can find all these proofs when necessary. Banks are charging exorbitant fees to produce copies of statements and checks, so elect to receive statements & cancelled checks or make sure you receive them electronically. It seems you can never have too much proof. Collect and save the medical records. Save all of this for at least a five year period on an ongoing basis.

Forewarned is forearmed. The grueling MLTSS application process can be just a bit easier if you retain your records.

Call us for help with Medicaid applications for long term care ……. 732-382-6070

New Jersey COVID-19 MedComm Contains Big Announcements on Medicaid Terminations and Eligibility

An important new Medicaid Communication (MedComm) was recently issued by the New Jersey Division of Medical Assistance and Health Services (DMAHS). As we had previously discussed, due to the COVID-19 emergency, Medicaid has loosened certain eligibility and post-eligibility rules. The MedComm explains and reconfirms our understanding of the changes in these areas:

Terminations: If you were approved for or receiving Medicaid in March 2020, you cannot be terminated for the length of the emergency unless you wish to do so voluntarily.  Terminations occur for a variety of reasons, including changes in resources (like selling a house and getting cash), changes in income (like getting a new pension from a deceased spouse), change in insurance coverage (like getting Medicare for turning 65) or failure to provide information to a Medicaid agency (information is usually requested on an annual basis).  If you had been on Medicaid in March and have been terminated for any reason without your consent, you should be reinstated. Call us if you are experiencing problems with this.

Applications: Medicaid is allowing “self-attestation” of income and resources in certain situations where they may have previously insisted on bank statements or other proofs that cannot be gotten during the COVID emergency. “Self-attestation” is a sworn statement signed by an applicant or representative to declare what their income or resources are as of an application date. Because it is sworn, attestation is a process to be taken seriously in conjunction with legal advice.

Clinical Eligibility: MLTSS Medicaid eligibility will be processed in the emergency without completion of the usual face-to-face clinical assessments that were typically required, as long as the facilities or individuals follow the procedures outlined in this separate guidance from Division on Aging Services Call us with your questions about this change in process.

Stimulus Payments: No stimulus payment will be counted toward resource eligibility for Medicaid. No enhanced unemployment payment ($600) will count toward income eligibility for Medicaid. This reconfirms what we had discussed earlier this month.

Everyone’s individual situation right now is a little different, so this new policy guidance will affect each person differently when applied to the individual’s case. Contact us at 732-382-6070 to discuss how this will affect you or your family members.

Special Needs Trusts continue to be Vital for People with Disabilities

The term “special needs trust” is used to refer to a trust that’s for benefit of a person with disabilities who depends on means-tested public benefits that have income limits or resource/asset limits. Sometimes these are “first party trusts” — created by the disabled person (over age 18) or his parent, grandparent, or guardian with court permission, or by a court, and funded with assets owned by the disabled person. Other times they are “third party trusts” — created by somebody (such as a parent or grandparent) for benefit of a disabled family member, and funded with the parent or grandparent’s assets. Still other times, these Trusts are written into a Last Will and Testament, so that the share being left to the disabled person will be protected within the “special needs trust.”  Now more than ever, families and individuals should review their estate plans to see if trusts are needed.

When an estate inheritance passes to a person who depends on means-tested benefits like SSI or Medicaid/.MLTSS, the individual might lose their benefits after receiving the inheritance because they will have excess resources. This creates a particularly risky situation for a person who receives Supports services through the NJ Division of Developmental Disabilities, because DDD benefits depend upon the person meeting those means-tested criteria. It can also be risky for an individual who receives skilled nursing benefits through the Medicaid/MLTSS program. There are remedies available, such as filing a court petition, but time and benefits can be lost while the remedies are being pursued. And now in this time of court closings due to COVID-19, everything is more difficult to pursue in court. Supreme Court release 3-27-2020

A special needs trust can be written in your Will and can be named as the beneficiary of your tax-deferred account (IRA, 401K, etc.) or your life insurance. The trust can be designated to receive the share of your probate assets that would otherwise go directly to the person with disabilities (causing the problems described above). Careful planning can prevent a crisis. If one of the potential heirs of your estate or your Will is disabled, you may want to review your plans to see if a special needs trust  would be protective for your heir.

Call us for advice about estate planning with special needs trusts …  732-382-6070