MEDICAID REDESIGN TEAM SEEKS DRAMATIC CHANGES IN NEW YORK MEDICAID

March 5th, 2011

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New York’s newly created Medicaid Redesign Team (“MRT”) are proposing dramatic changes in our Medicaid program. While it is early in the process, and the proposals may not be implemented in their present form or at all, budgeting pressures at all levels of government make it likely that some changes in the Medicaid program will occur. Here are a couple of the particularly troubling features of the MRT’s proposals:

Elimination of Spousal/Parental Refusal.Currently, a spouse or other legally responsible relative may refuse to provide, or contribute to, the support of an applicant for Community Medicaid or Medicaid Home Care. When this occurs, Medicaid is obligated to provide care or services to the applicant if he is individually eligible, even if the spouse or other relative could afford to pay. The MRT is proposing that the resources and income of the spouse or other legally responsible relative should be counted in determining whether the applicant is eligible for Medicaid. This means that spouses, and parents of disabled children, will be required to spend down virtually all of the household’s assets, and contribute a share of their income, before their ill spouse or disabled child will be eligible to receive care.

Implementation of the 5-year “Look Back” for Community Medicaid and Home Care. Currently, the 5-year look back and transfer penalties apply only to applicants for Medicaid Nursing Home Care. This means that applicants for Community Medicaid or Home Care are currently free to transfer their assets to family members, friends, or trusts, and thereby become eligible for Medicaid benefits. The MRT’s proposal would extend the 5-year look back to Community Medicaid and Home Care, which means that many potential applicants will find that they are ineligible for Medicaid, or subject to a lengthy penalty period before benefits can be obtained.

Impact of these proposals. If the above proposals become law, many Medicaid applicants and their families will be severely affected. Some will find their financial situation and lifestyle significantly diminished, and others may find it difficult to pay for even basic living expenses. People, including disabled children, who could otherwise have been cared for at home may find that institutional care is the only viable option once the family’s resources have been exhausted.

What to do? Now, more than ever, people who need, or may need, long-term care should make it a top priority to consult an Elder Law attorney. Planning steps may need to be taken earlier than previously seemed advisable. It will still be possible to improve your situation, even if these draconian new measures find their way into law.

Entry Filed under: Health Care Legislation,Medicaid Planning