CMS confirms that transfer penalty for Medicaid home care applicants starts to run at time of application

Followers of this blog know that when a person applies for Medicaid under the New Jersey MLTSS program or other state programs that pay for nursing homes, assisted living or home health care services, there is a 5-year look-back that is done by the agency to determine if a transfer penalty should be imposed for gifts made during the 5 years preceding the application. The penalty is a period of time in which the State won’t pay for the care. The greater the amount that was gifted, the longer the penalty period.

There has been a problem for years that was inadvertently created when the Medicaid law was amended by the Deficit Reduction Act of 2005 (“the DRA”). The problem was caused by an interpretive guidance memo called State Medicaid Director Letter (SMDL #06-018) published on July 27, 2006 by CMS. The DRA itself specified that the start date of the penalty was to be “the later of (1) the month during or after which a transfer is made or (2) the date on which the individual is eligible for medical assistance under the State plan and would otherwise be receiving institutional level care services.” See Secn. 1917(c)(1)(D) of the Act. However, the 2006 explanatory SMDL stated that the start date was “…the date on which the individual is eligible for Medicaid and is receiving institutional level of care services.” (emphasis added). The problem was obvious — it created a catch-22 in which the penalty wouldn’t start to run until the individual was receiving services, yet no services could be provided until a penalty period had ended! Also, the memo was at odds with prior positions that applied resource rules and transfer penalty rules uniformly to people applying for Medicaid in different settings.

Well it only took 12 years, but the good news is that CMS has just published SMD # 18-004 which clarifies the point once and for all: the start date for applicants for home and community services is the date on which they’d be receiving services were it not for the penalty period. Here it is: CMS SMD # 18-004

Asset protection is feasible even when a person is right on the verge of applying for Medicaid. Houses and other assets can be protected with proper senior care planning. Call us first, to advise you and prepare your Medicaid application…. 732-382-6070

New federal rating system for nursing homes could show drop in scores

On February 20th, the federal Centers for Medicare & Medicaid Services (CMS) launched a new rating system for nursing homes which is based on factors that go beyond self-reported data, and will reflect auditing of self reports. Staffing levels must be reported quartely, and will be cross-matched against payroll records to verify accuracy. The use of antipsychotic medications will now be a factor in the evaluation, and the standards to be met to achieve the top 5-star rating have been improved.  The consumer website is NursingHomeCompare. Since the methodology has changed, you may not be able to accurately compare 2014 with 2015 when it comes to the issues that have changed. Scores may drop because of the new requirements. In NJ, roughly 25% of the nursing homes have achieved a 5 star rating in recent years.

There are 373 nursing homes in New Jersey.  They are inspected by both the NJ Department of Health and the federal government through CMS. New Jersey inspects most of them every year. Explanations about the state’s inspection program can be found at  the Department of Health Facilities Licensing and Evaluation website.

Complaints concerning nursing homes may be filed with the Department of Health particularly on level of service, violations of specific regulations,  or structural issues. Complaints concerning alleged infringement of residents’ rights can be filed with the NJ Ombudsman for the Institutionalized Elderly.

In selecting a nursing home, you will always want to visit the premises on several occasions (different days of the week including weekends, and days as well as evening), along with looking at data available through governmental websites. After all you’d be selecting a new home for yourself or your loved one.