The rules for applying to Community Medicaid in New York State to cover the cost of long-term care are undergoing an overhaul. Laws signed in April 2020 amend the application process for these services as well as other parts of the Medicaid program.
30 Month Look Back
The biggest headline is that there will now be a 30-month lookback on transfers of assets for applications for community-based services. The Medicaid program will refuse to cover the cost of care, assessing a penalty period based on the value of transfers made out of the applicant’s or their spouse’s name during that 30-month period.
The effective date in the statute is October 1, 2020 but the State has said it will delay implementation of this extended application process until January 2021. The good news is that we believe transfers made before October 1, 2020 will not result in a penalty period because the look back will not apply to those transfers.
Change in Assessment Process
Another change in the law is related to the assessment process that determines the number of hours of assistance the Medicaid program will pay out. For the first time, the Medicaid home care program will require that an individual need physical assistance with three or more activities of daily living (ADLs) to be eligible for the program. There will be an exception for those diagnosed with Alzheimer’s or dementia; they will only need to show the need for supervisory assistance with two or more activities of daily living. The effect of this change will be to remove from the program persons who require a lower level of care, forcing them to pay privately for those services.
The amended laws left room for the Department of Health to develop a new assessment tool. It also allows for those who were previously enrolled in the program to be grandfathered in with their prior level of care. There are still many questions to be answered as to how the program will work in light of these new changes.
Knowledge is Power
The most important thing we can do in life is plan, and this is no different. For some individuals this will mean that they want to effectuate transfers of assets to irrevocable Medicaid asset protection trusts before the October 1, 2020 deadline. While others that are not ready to embark on this process now will need to plan for this 30-month time period in which it will be more difficult to qualify for services. Still others will create a plan that involves privately paying for care or purchasing a long term care insurance product. In all cases, it will be in your best interest to seek advice on your particular situation from your advisors, including an attorney that focuses on estate planning and elder law.