Is Medicaid Home Care an Option Available to Me or My Loved Ones?

By: Anthony J. Enea, Esq.

All too often seniors and their families are faced with the dilemma of deciding whether it is possible for them to continue residing at home in light of their physical and cognitive limitations. Fortunately, for seniors living in the southern tier of New York State, the Medicaid home care program is both easily accessible and relatively generous.

One of the first things that helps make Medicaid home care accessible to New York seniors that are in need of assistance with activities of daily living (ADLs), being, walking, dressing, feeding, toileting, and bathing, is that the transfer of asset rules for Medicaid eligibility do not apply to home care Medicaid. Thus, a single (non-married) individual who has non-IRA/retirement assets in excess of $15,150 can transfer his or her assets above said amount to anyone and/or an irrevocable trust, and still be eligible for Medicaid home care. IRA's, 401K's and other qualified accounts are not considered available resources for Medicaid eligibility. The required minimum distributions from said qualified accounts are counted as available income, however.

While the transfer of assets will disqualify them for the Medicaid nursing home program by creating the five-year look back period, it does not impact their eligibility for Medicaid home care. Additionally, the spousal impoverishment rules are also applicable for Medicaid home care. Thus, a potential applicant that is married can transfer his or her non-IRA/retirement assets in excess of $15,150 to his or her spouse. Then, the spouse of the applicant can execute what is known as a "spousal refusal letter." He or she advises Medicaid in writing to not look at his or her assets and/or income in determining the eligibility of his or her spouse, but only look at the assets and income of the applicant spouse. Once the transfers are made the applicant spouse would have $15,150 or less in his or her non-IRA assets, thus, making him or her eligible for Medicaid from the resource (assets/savings) perspective.

The execution of a spousal refusal letter by a spouse in either the Medicaid home care or nursing home scenario allows Medicaid to sue the refusing spouse for the value of the services they have provided. However, in light of the exorbitant private pay cost of either home care or nursing home care versus the Medicaid reimbursement rate (the amount Medicaid pays, which is significantly less) and the fact that there is uncertainty as to whether Medicaid will pursue a spousal refusal claim, the execution of spousal refusal is often the most logical option.

Another factor which makes the Medicaid home care program accessible to seniors is that they can still retain virtually all of their income to pay for their at home expenses while still being eligible for Medicaid. This is possible because Medicaid allows a recipient to retain the first $862.00 of his or her income, and then contribute all income above said amount to a pooled community trust (administered by a charity), which can then pay the applicant's bills from said income. Thus, with the exception of a small monthly fee charged by the charity to administer the trust, the full amount of the recipient's income is available to pay his or her living expenses.

The number of home care hours one can receive is contingent upon the applicant's ability to perform the ADLs earlier stated herein. The more ADLs the applicant needs assistance with, the more hours of care he or she will generally be eligible for. It is possible that the applicant could receive round the clock care seven days per week depending on his or her needs. However, it is much more common for the applicant to be approved for 8-12 hours per day, seven days a week.

In conclusion, while it sounds unbelievable that one could transfer his or her assets, protect one's income and still be eligible for Medicaid home care in New York, it is currently a reality. Whether or not New York Medicaid will be able to sustain its largesse remains to be seen, especially if changes are made to the program federally.