In order to be eligible for Medicaid, you cannot have recently transferred assets. Congress does not want you to move into a...Read more
House Approves Bill Substantially Changing Asset Transfer Rules
- November 21st, 2005
By the narrowest of margins, the House has voted to approve a budget plan that cuts about $12 billion from Medicaid, including imposing harsh new restrictions on the ability of the elderly to transfer assets before qualifying for Medicaid coverage of nursing home care.
The Deficit Reduction Act of 2005 (HR 4241) was approved by a 217 to 215 vote in the early hours of Friday, November 18. The bill maintains provisions aimed at making it even more difficult for the middle-class elderly to receive long-term care coverage.
The measure would extend Medicaid's "lookback" period for all asset transfers from three to five years and change the start of the penalty period for transferred assets from the date of transfer to the date when a Medicaid applicant would otherwise be eligible. The bill also would make any individual with home equity above $750,000 ineligible for Medicaid nursing home care (in a concession to Republican moderates, this limit was raised from $500,000). The House bill would make other, smaller adjustments to Medicaid transfer rules, including the treatment of annuities and continuing care retirement community entrance fees. The final measure also retains a provision imposing co-payment increases on Medicaid beneficiaries with incomes above the federal poverty level.
The bill now must be reconciled in conference committee with a Senate budget bill that makes only modest changes in the asset transfer rules. (For an ElderLawAnswers article explaining the effects on America's elderly of the two competing proposals, click here.)
Last week, Republican leaders were forced to pull the bill from the floor because of a lack of support. In the final vote, after some of the bill's cuts had been softened, 14 House Republicans and all House Democrats opposed the bill. (For a tally of votes on the bill, click here.) The Center on Budget and Policy Priorities estimates that the eleventh-hour changes only eased the cuts aimed at the poor by 2 percent from the original version.
The Associated Press predicts that the upcoming conference committee negotiations with the Senate will be "arduous." The negotiations, writes the Los Angeles Times, "are likely to test [President] Bush's ability to work his will in Congress when his approval ratings are at an all-time low." The conference committee has not yet been named and no timetable for its deliberations has been set.
The final version of HR 4241 is still unavailable. For a version of the bill that does not reflect last-minute changes (such as the shift from $500,000 to $750,000 in home equity), click here. Scroll down to Title III, Chapter 2 for the asset transfer rule changes.
Meanwhile, a survey for the National Academy of Social Insurance finds that 7 in 10 Americans age 40 and over think the federal government should do more to help people meet the cost of long-term care.
Local Elder Law Attorneys in Ashburn, VA
Ron M. Landsman, P.A.
Ron M. Landsman has been practicing elder law since 1983, before it was known as elder law, originally with Landsman and Laster, Washington, D.C., then Landsman, Eakes and Laster, also in Arlington, VA, and since 1990 in his own practice in Montgomery County, Maryland. He has been among the most active members of the...
Needham Mitnick & Pollack, PLC
Judith Mtinick is well known for acting as a guardian, conservator, trustee or agent on behalf of clients or by court appointment. This experience gives her a wide perspective and extensive practical knowledge that she uses when advising clients in drafting their planning documents. Her experience, as a court appointed...
The Law Firm of Evan H. Farr, P.C.
In practice since 1987, Fairfax Attorney Evan Farr is widely recognized as one of the leading Elder Law, Estate Planning, and Specials Needs attorneys in Virginia and one of foremost experts in the Country in the field of Medicaid Asset Protection and related Trusts. Evan Farr has been quoted or cited as an expert by n...