As a result of New York’s 2020 budget, some big changes are on the way for many New York Medicaid recipients. These changes take effect on October 1, 2020. Let’s take a look at what New York practitioners and Medicaid recipients should be prepared for:
There will be a look-back period for community Medicaid. Community Medicaid is benefits for care provided to recipients in the community, such as home health aide. The new look-back period will be 30 months. Prior transfers of assets for less than fair market value will incur a penalty if done in the 30 months prior to the Medicaid application. As with the traditional five-year look-back for nursing home long-term care, the penalty period for community Medicaid will begin when the applicant is otherwise eligible. Meaning, the applicant must meet financial requirements as well as meet the disability standard for which care is needed.
A look-back period means that the Medicaid applicant will need to present financial documentation and go through an eligibility determination analysis. The penalty, if any, will be calculated in the same fashion that the penalty period is calculated for long-term care Medicaid benefits. The total value of all transfers made for less than fair market value during the penalty period is divided by the penalty divisor amount. The penalty divisor amount is the average cost for nursing home care, and it varies by region in New York.
Qualification requirements for community Medicaid will change. Applicants will need assistance with three activities of daily living, such as bathing, grooming, dressing, feeding, or ambulating. If an applicant has dementia or Alzheimer’s Disease, they would only need help with one activity of daily living to qualify for community Medicaid benefits. Also, the diagnosis and treatment plan must be prescribed by a physician selected or approved by the Department of Health, not a physician chosen by the Medicaid recipient.
During budget talks this year, spousal refusal was on the chopping block, but survived. Spousal refusal allows the well spouse to refuse to use their assets for their sick spouse’s care. Basically, the sick spouse’s eligibility case is analyzed as if they were a single individual. However, with spousal refusal, the state is assigned the sick spouse’s rights to support and thus the state can sue the well spouse for the funds expended on the sick spouse’s care. Keeping the availability of spousal refusal was a big win for long-term care advocates. However, the changes described above are big news for Medicaid recipients in New York. This could provide new planning opportunities for practitioners assisting clients in community Medicaid eligibility cases.
ElderCounsel recently hosted a webinar that went into this topic in more detail. During this video, you will learn:
- Beat the clock: How to take advantage of NY’s favorable Medicaid Home Care Rules now to get clients “Grandfathered in” before the October 1 deadline
- Explanation of the new 30-month look back for Medicaid home care benefits
- Calculating the penalty period for transfers during the look back, and implementing a “rule of halves” plan using the P-Note calculator
- Discussion of other changes: reductions to the Spousal Allowance and more restrictive eligibility criteria for personal care and consumer-directed benefits
- Planning strategies to create new opportunities for elder law practices