There’s no “income cap” anymore for Medicaid long term benefits

When I first started filing Medicaid applications for my clients back in 1995, a person who needed long-term care services in the home or assisted living but had run out of money could not even apply for Medicaid if their gross monthly income was higher than the “income cap.” Of course, the income cap was well below the amount that was needed to pay for care, which meant that a lot of people couldn’t receive necessary services. Basically it meant that many people who would have done well in a community environment with a home health aide and other support ended up moving into a nursing home, because that was the only setting where Medicaid would pay for them. Or they had to do without care or cobble together a plan in which family members took care of them.

Finally, in 2014 when the State’s Comprehensive Medicaid Waiver went into effect, the income cap was eliminated as a bar to receipt of community & assisted living services. There is a special procedure that the applicant has to use, because the income has to be funneled through a structure called a Qualified Income Trust (QIT), but at least the person can now apply for Medicaid benefits. You can read more about QIT’s in our earlier blogs.

We continue to meet people who haven’t heard this good news. If your family is struggling with how to arrange and pay for long term care, call us for legal advice regarding Medicaid eligibility that fits your specific situation.

For personalized advice about a Medicaid plan call … 732-382-6070

Going from ACA Medicaid to “Regular” Medicaid Can Be a High Wire Act Without Legal Assistance

New Jersey has a lot of roads to eligibility for Medicaid, and that’s a good thing.  All of those roads are called NJ FamilyCare, and that’s a confusing thing.

Medicaid in New Jersey is provided by five Managed Care Organizations (MCO) now through NJ FamilyCare.  You must choose one to get services, including long-term services and supports (LTSS), which will be coordinated by the MCO care manager.

If you began to receive Medicaid/NJ FamilyCare benefits because you were income- eligible and without other creditable health coverage (in other words, you receive Medicaid through the Obamacare Medicaid expansion), you could lose your Medicaid coverage if you have a change in your modified adjusted gross income (MAGI) or you obtain other coverage (like Medicare). Unless you are eligible for Medicaid through another pathway (called Aged, Blind or Disabled, or ABD) you will lose services.

For example, if a person with limited income and no insurance had an unexpected illness and spent time in the hospital, it is likely that the hospital got the person on Medicaid through Obamacare, enrolled the person in an MCO, treated that person, and then discharged that person to a rehabilitation facility, where long-term care would also be covered.  However, if there is a later increase in income which would allow that person to purchase subsidized insurance, Medicaid will be discontinued and there will no longer be a payor for the nursing facility or other long-term care setting.  Hence, the need to scramble for ABD, which can co-exist with other insurance coverage.

Planning for ABD Medicaid could include:  spending down resources, establishing a Qualified Income Trust for income, establishing a Special Needs Trust for assets, or other planning that could involve a spouse or disabled or minor child.  In the case of a special needs trust, this type of planning must be done before your 65th birthday.

New Jersey’s Medicaid expansion benefit package does include, via federal waiver, MLTSS–so you must always think about how your eligibility category might change and how to maintain the benefits you currently have.  It can be a very difficult process, but we can help–call us at 732-382-6070.

State of NJ issues MedCom to Medicaid Supervisors on use of Qualified Income trusts (QITs)

On December 19th, 2014, the NJ Division of Medical Assistance and Health Services (DMAHS) issued Medicaid Communication No. 14-15  to the County Welfare (CWA) Directors, explaining the necessity for certain higher-income Medicaid applicants to divert their excess income into a Qualified Income Trust (QIT) before they can apply for MLTSS Medicaid services to pay for nursing home, assisted living or community care. I’ve blogged about this previously – check my October and November posts. According to the Med-Com at page 1, the purpose of the QIT is “to disregard an individual’s income above 300% of the Federal Benefit Rate (FBR). In order for [it] to be disregarded, it must be deposited into the QIT bank account.”  Here is the pdf:

14-15_Qualified_Income_Trust 

In 2015, if the monthly income is in excess of $2,199.00, it has to be diverted through a QIT.

Keep in mind that the Trust has to be set up before the date you want eligibility for. So you may need a few months to finish up the Medicaid “spend-down” and to set up this Trust at the bank. Many banks are still not familiar with this structure. Once the application is filed, and the CWA caseworker determines that there is eligibility, s/he will prepare a Medicaid Patient Responsibility (PR) form to be used by the Trustee as the guide for the monthly allocation of the income for the Medicaid recipient’s required expenses.The income has to be spent in this order each month: (1) Personal Needs Allowance or home maintenance allowance, (2) Spousal and family member maintenance allowance (calculated by the CWA based on the regulations), (3) unreimbursed state-approved medical expenses, (4) health insurance premiums, and (5) the mandatory cost share to the facility.

At ever step of the way there can be legal disputes that arise based on how the regulations apply to your particular case. Call us for advice and representation with Medicaid applications, MLTSS and QIT’s … 732-382-6070.