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States Look at Tightening Rules for Medicaid Transfers
- April 25th, 2003
Led by Connecticut, Massachusetts and Minnesota, a growing number of budget-crunched states are considering making it more difficult for older Americans to transfer assets in order to gain Medicaid coverage of nursing home care, according to an Associated Press article appearing in the Arizona Republic.
Minnesota and Connecticut are asking permission from the U.S. Centers for Medicare and Medicaid Services obtain a waiver from federal rules that would allow them to change their rules on transferring assets. Massachusetts is weighing a similar request, and experts say 15 or 20 other states are considering such action.
Currently, Medicaid imposes a "penalty period" that begins the date that money is transferred. All three states would make this waiting period start on the date a person applied for Medicaid. Under this approach, an impoverished individual already in a nursing home would be without Medicaid coverage during any applicable penalty period, which could very easily result in the nursing home trying to discharge the resident. In addition, Minnesota's plan would add another three years to the period during which Medicaid officials can "look back" to find transfers.
"If Minnesota and Connecticut get approved, I think you'll have a rush to the trough," said William Browning, incoming president of the National Academy of Elder Law Attorneys and a lawyer in Columbus, Ohio. "A lot of folks are watching."
The states are hoping to save millions by tightening the rules, but critics of the changes say those paying the price will not be millionaires sheltering cash but older Americans of very modest means trying to avoid complete financial devastation from long-term care costs.
Attorney Browning said his typical client is the spouse of someone entering a nursing home who wants to protect more of the couple's income than would be allowed under standard Medicaid regulations.
"There's this myth out there that millionaires are giving away all their money to be eligible for Medicaid," he said. "And we just don't see it."
But state officials say they are optimistic that the waivers will be granted, in part because the Bush administration has signaled a willingness to give states more flexibility in running their Medicaid programs.
To read the full article in the Arizona Republic, click here. (Article may be only temporarily available.)
For more on the Medicaid eligibility rules, click here.
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