Proposal for Homemaker Services

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					Module 4: Public Financing of
Long-Term Care Services
Medicare’s Coverage
of Long-Term Care (LTC)
    Medicare’s nursing home benefit is limited to
     post-acute care

    Medicare’s home health benefit is limited to
     the need for skilled nursing care on an
     intermittent basis, or for specific therapies
     (e.g., physical or speech therapy)

Medicare’s Skilled Nursing Facility
(SNF) Benefit
     Medicare’s SNF benefit provides nursing
      home coverage in very limited circumstances:
       – Physician has decided that beneficiary
         needs daily skilled care
       – Only after a hospital stay of at least three
         days for same post-acute condition
       – Must be provided in a Medicare-certified
         nursing facility

Medicare’s SNF Benefit

  Medicare’s SNF benefit pays a portion of
   skilled nursing home care for up to 100 days:
    – 0 to 20 days - Medicare pays 100 percent
    – 21 to 100 days - Beneficiary pays a daily co-
      payment and Medicare pays the balance
    – 100+ days – no Medicare coverage
  Care continuously evaluated as “medically
  Average Medicare-covered stay is about 21

Medicare’s Home Health Care Benefit

  Beneficiary must require skilled care on a part-
   time basis
  Home health aide services sometimes covered
   (part-time) when nursing care is also provided
  Other covered services include physical,
   speech and occupational therapy services,
   medical social services, certain medical
   supplies, and durable medical equipment

Medicare’s Home Health Care Benefit

    Medicare’s Home Health benefit does
     not cover:
     –   24-hour care
     –   Meals delivered to the home
     –   Homemaker services (e.g., shopping,
         cleaning, and laundry)
     –   Non-skilled personal care services

Medicare’s Home Health Benefit

    Medicare pays the full cost of covered
     home health visits if:
     –   Physician certifies that home care is
         medically necessary
     –   Beneficiary is “homebound” (unable to move
         outside the home without assistance)
     –   Care is provided by a Medicare-certified
         home health agency

Medicare Supplemental Insurance

    Only pays Medicare co-pays and deductibles

    Does not cover additional nursing home days
     or home health visits not covered by Medicare

    Medicare Advantage and other Medicare plans
     generally waive (or reduce) Medicare
     deductible and co-payment requirements for
     their members

Medicaid’s Coverage of LTC

  Joint Federal/State program
  States have considerable discretion regarding
   eligibility requirements and benefits, within
   broad federal guidelines
  Designed to provide LTC coverage for persons
   who lack the financial resources to pay for
   their own care
  Medicaid is the primary public financing source
   for LTC

Medicaid Eligibility Criteria

   Medicaid eligibility is complicated, and each
    state is different
   Financial eligibility criteria apply to both
    income and resources
   For non-married persons, applicants are
    generally limited to no more than $2,000 in
    countable resources
   Medicaid spousal impoverishment rules have
    greatly enhanced financial protections for
    community spouses

Medicaid: Treatment of the Home

  Primary residence is generally excluded as a
   countable resource, as long as the Medicaid
   beneficiary intends to return home
  States may in some circumstances recover
   costs from the beneficiary’s estate after death,
   if this does not cause undue hardship
  Surviving spouses have a right to stay in the
   home for as long as they live, as do other
   family caregivers

Texas Medicaid Estate Recovery

  In Texas, Medicaid estate recovery will
   apply to applications for long-term care
   Medicaid filed on or after March 1, 2005.
  Those who applied before March 1, 2005
   will be “grandfathered out” (assuming
   they pursued their application through to
  No liens are allowed under the Texas
   Medicaid estate recovery law.

Texas Medicaid Estate Recovery

  Texas’ Medicaid estate recovery
   program is one of the most limited in the
   United States.
  It applies to the most limited group of
   services, has a wider array of “excluding
   survivors” than usual, has broad
   provisions for “undue hardship,” and
   affects only the probate estate.
  Recoveries are to fund long-term care.

Texas Medicaid Estate Recovery

  Federal law requires Medicaid estate recovery
   at a minimum to cover Medicaid nursing facility
   services, home and community-based
   services, and related Medicaid costs of
   hospital and prescription drug services,
   provided to persons 55 years of age or older.
  The federally-required minimum scope of
   covered services is the Texas maximum.

Texas Medicaid Estate Recovery

  Federal law prohibits recovery while there is a
   surviving spouse, surviving child under the age
   of 21, or surviving adult child who is blind or
   disabled as defined under SSI.
  CMS permitted Texas to add a further
   excluding survivor – An unmarried adult child
   residing continuously in the recipient’s
   homestead for at least one year before the
   recipient’s death.

Texas Medicaid Estate Recovery

  If there is no excluding survivor,
   Medicaid estate recovery can still be
   avoided if it would cause undue
  CMS has allowed Texas to have a very
   broad definition of undue hardship.
  Even if undue hardship is not present,
   recovery can be waived or compromised.

Texas Medicaid Estate Recovery

  Undue hardship can be found if the
   homestead is worth not more than
   $100,000 fair market value and if the
   heirs have income of less than 300% of
   the Federal Poverty Income Limit.
  This is more generous than the original
   proposal of $50,000. CMS has agreed
   to $100,000.

Texas Medicaid Estate Recovery

    If the estate property has been a family
     business, farm, or ranch for at least 12
     months before the death of the recipient
     and is the primary income producing
     asset of the heirs and legatees, and
     produces 50% of their livelihood, and
     recovery would result in heirs and
     legatees losing their primary source of
     income, recovery can be avoided.

Texas Medicaid Estate Recovery

  Recovery can also be avoided if heirs or
   legatees would become eligible for public
   and/or medical assistance if recovery
   were to occur.
  Recovery can also be avoided if allowing
   one or more survivors to receive the
   estate will enable him or her to stop
   receiving public or medical assistance.

Texas Medicaid Estate Recovery

  Recovery can also be avoided if the
   Medicaid recipient received medical
   assistance as the result of a crime.
  Additionally, for other compelling
   circumstances, recovery can be avoided.
  Undue hardship must be requested
   within 60 days of Medicaid’s “Notice of
   Intent to File a Claim.”

Texas Medicaid Estate Recovery

  Even if one of the grounds for undue
   hardship does not exist, and if there is an
   heir or legatee who is not an excluding
   survivor, the Texas Medicaid program
   can settle a claim for less than its full
   extent, or waive the claim entirely, for
   good cause shown.
  Also, if recovery is not cost-effective, it
   can be avoided.

Texas Medicaid Estate Recovery

    Recovery will be deemed not cost-

     –   If the value of the estate is $10,000 or less,

     –   If the recoverable amount of Medicaid costs
         is $3000 or less.

Texas Medicaid Estate Recovery

  The Texas Medicaid program will issue
   “Notice of Intent to File a Claim” once a long-
   term care Medicaid recipient (55 years of age
   or older) has died, if there are no excluding
   survivors. No claim will be filed if the recipient
   is “grandfathered out.”
  As noted above, an undue hardship exemption
   must be requested within 60 days of the
   Notice of Intent to File a Claim.

Texas Medicaid Estate Recovery

  If the Texas Medicaid program decides
   to file a claim (either in whole or in part),
   the claim will be filed as a Class 7 claim
   in probate.
  Only property in the probate estate will
   be affected.
  As noted above, recoveries will fund
   long-term care.

Texas Medicaid Estate Recovery

    When Medicaid long-term care is applied
     for, applicants will be informed of the
     estate recovery program.

    The information will also cover transfer of
     assets and the penalty periods for
     uncompensated transfers.

Other Medicaid Rules

    Transfer of Assets
     –   Applies penalties to person who transfers
         assets with the sole purpose of becoming
         eligible for Medicaid

Medicaid Nursing Home Coverage

    Functional criteria for nursing home coverage
     are set by each state

    Many persons enter nursing homes as private
     pay and “spend down” resources to Medicaid

    Once on Medicaid, beneficiaries must
     contribute all income above the state personal
     needs allowance to the cost of care

Medicaid Nursing Home Coverage
        At any one time, about 60% of all nursing
         home residents are receiving Medicaid

        States spent $46.5 billion for nursing home
         care in FY 2002

Sources: Medical Expenditure Panel Survey (MEPS) and Medstat Analyses of CMS 64 Data.   28
Medicaid Coverage of Home Care

    Medicaid programs cover non-skilled home
     care either:
     –   Under the regular state Medicaid plan, or
     –   Under the Medicaid Home and Community-Based
         Care Waiver (HCBS) Program
  Regular state plan services (e.g., personal
   care) must be provided equally to all Medicaid
  HCBS waiver services can be targeted to
   designated populations, geographic areas
   and/or LTC settings
Medicaid Coverage of Home Care
  HCBS waivers can only be provided to
   persons who meet functional eligibility criteria
   for nursing home care
  HCBS waivers cover a wide range of
   community-based services that are not
   covered under regular Medicaid
  States are expanding HCBS waiver programs
   as an alternative to nursing home care

Other Public LTC Financing Options

    Older Americans Act Programs
     –   Administered by the AOA/DHHS, 56 State
         Units on Aging, 655 Area Agencies on
         Aging, 244 Tribal Organizations and 29,000
         Community Service Providers
     –   Provides a broad range of community-
         based services, including home delivered
         and congregate meals to persons over the
         age of 60
     –   Not means-tested

Other Public LTC Programs

    Veterans’ Administration (VA)
     –   Provides LTC coverage for service-related
         disabilities or for certain eligible veterans
         and/or their spouses
     –   VA owns and operates its own network of
         nursing homes

Some New LTC Financing Options
  Programs of All-Inclusive Care for the Elderly
   (PACE) programs integrate Medicare and
   Medicaid in one managed care plan
  Some Medicaid programs cover LTC services
   under a managed care model
     –   Arizona Long-Term Care System (ALTCS)
     –   Minnesota Senior Health Options (MSHO)
     –   Wisconsin Family Care
     –   Texas Star+Plus
    Cash and Counseling Demonstration provides
     “voucher” to Medicaid beneficiaries who
     purchase their own LTC services

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