Fong Law Group

Highlights of How the Omnibus Bill Will Benefit Older Adults

The Senate and House have cleared the passage of a year-end $1.7 trillion appropriations bill that will benefit older adults on a number of fronts.

The bill, which runs more than 4,000 pages and includes a wide variety of legislation, heads to President Biden next for his signoff.

Here is a breakdown of some of the highlights that relate to supporting older Americans:

Health and Housing

• Opt to age at home – The Money Follows the Person (MFP) Program has been helping older adults age in their own home or a community setting, rather than in nursing homes, since 1972. The newly passed bill extends MFP through September 2027.
   
• Age in place safely – The omnibus bill has also doubled funding for the federal government’s Older Adult Home Modification Program from $15 million to $30 million.
  
  For seniors with limited income, this program covers the cost of simple, low-cost home modifications – such as railings and temporary wheelchair ramps – that help them age in place safely.
   
• Provide for your healthy spouse if you are on Medicaid in a nursing home – Medicaid beneficiaries who must reside in a long-term care facility but have a spouse still living at home will continue to see their healthy spouse protected from poverty.
  
  Known as spousal impoverishment rules, these protections ensure that the healthy spouse receives income while their institutionalized spouse keeps their Medicaid eligibility. These protections, which are adjusted each year, will continue to be in place until September 2027.
   
• Continue to see doctors online – Lawmakers have extended access to telehealth services for Medicare enrollees for another two years.
   
• Find affordable housing with support services – The Housing for the Elderly Program has received a billion-dollar bump in funding as well.
  
  This program seeks to aid seniors with very limited income in securing housing that is within their means while also offering supportive services such as assistance with cooking and cleaning.

Retirement Savings

• Contribute more to retirement – For older workers, the omnibus bill raises what are known as “catch-up” contribution limits for retirement savings. Taxpayers ages 60 to 63 will be allowed to contribute an extra $10,000 to their 401(k) starting in 2025.
   
• Access 401(k) funds for emergencies – If you need to take money out of your 401(k) before reaching age 59½, under certain circumstances you will no longer have to pay the 10 percent penalty fee for withdrawing money early. As of the end of 2023, you will be allowed to withdraw up to $1,000 a year for unforeseen emergencies without incurring a penalty.
   
• Wait longer to withdraw money from your retirement accounts – Previously, you were required to begin withdrawing money from your retirement plan account starting at age 72. This mandatory withdrawal is known as a required minimum distribution (RMD).
  
  As of January 1, 2023, the new bill allows you to hold off until age 73 to take funds from these types of private retirement accounts.

Protecting Spouses of Medicaid Applicants: 2023 Guidelines

The Centers for Medicare & Medicaid Services (CMS) has released the 2023 federal guidelines for how much money the spouses of institutionalized Medicaid recipients may keep, as well as related Medicaid figures.

What Are Spousal Impoverishment Rules?

Spousal impoverishment is a concern for older couples when there is one spouse who requires long-term care and applies for Medicaid.

Before the federal government enacted spousal impoverishment protections, many healthy spouses faced poverty when their partners needed long-term care. The spousal impoverishment rules are based on the idea that spouses will provide for each other.

Community Spouse Resource Allowance

In 2023, the spouse of a Medicaid recipient living in a nursing home (called the “community spouse”) may keep as much as $148,620 without jeopardizing the Medicaid eligibility of the spouse who is receiving long-term care.

Known as the community spouse resource allowance (CSRA), this is the most that a state may allow a community spouse to retain without a hearing or a court order. While some states set a lower maximum, the least that a state may allow a community spouse to retain in 2023 will be $29,724.

Monthly Maintenance Needs Allowance

Meanwhile, the maximum monthly maintenance needs allowance (MMMNA) for 2023 will be $3,715.50. This is the most in monthly income that a community spouse is allowed to have if their own income is not enough to live on and they must take some or all of the institutionalized spouse's income.

The minimum monthly maintenance needs allowance for the lower 48 states will be $2,288.75 ($2,861.25 for Alaska and $2,632.50 for Hawaii) until July 1, 2023.

In determining how much income a particular community spouse is allowed to retain, states must abide by this upper and lower range. Bear in mind that these figures apply only if the community spouse needs to take income from the institutionalized spouse.

According to Medicaid law, the community spouse may keep all their own income, even if it exceeds the maximum monthly maintenance needs allowance.

The new spousal impoverishment numbers (except for the minimum monthly maintenance needs allowance) take effect on January 1, 2023.

Home Equity Limits

In 2023, a Medicaid applicant’s principal residence will not be counted as an asset by Medicaid if the applicant's equity interest in the home is less than $688,000. States have the option of raising this limit to $1,033,000.

Will Medicare Pay for Housekeeping Services?

Medicare is federal health insurance for people over 65, some younger people with disabilities, and those with end-stage renal disease. Coverage of housekeeping services under Medicare can depend on several factors.

Coverage Under Original Medicare?

Medicare is comprised of Part A and Part B coverage. It is often referred to as “original Medicare.”

Part A is free for most people and covers a certain number of days related to hospital inpatient stays, care in a skilled nursing facility, hospice care, and some home health care.

Part B covers doctors’ services, outpatient care, medical supplies, and preventive services. There is a monthly premium for Part B Medicare, plus cost sharing of any care received pursuant to Part A or B.

Original Medicare does not generally cover housekeeping services. Original Medicare labels these services as “homemaker” services, which also include shopping, cleaning, and laundry. If you cannot clean your home for medical reasons, then these costs would be out of pocket.

Coverage Under Medicare Advantage?

However, some Medicare Advantage plans may cover cleaning services. A Medicare Advantage Plan — also commonly referred to as Medicare Part C — is another way to get your Medicare coverage, except through a private insurance company. Many Medicare Advantage plans will cover things original Medicare may not cover and provide additional benefits. However, these companies must follow the rules set by Medicare.

Medicare now allows these private insurers to pay for some limited housecleaning if it is linked to a specific health issue. For example, if you suffer from asthma or breathing conditions, these plans may cover filtration or air cleaners, periodic washing of linens, vacuuming and carpet cleaning, and other similar services. If you suffer from an immune deficiency condition, it may be possible to get coverage for periodic disinfectant cleaning services. However, ongoing or regular services are not likely to be covered.

A senior’s eligibility for Medicare Advantage plan options will depend on what plan options are offered in their area. For more information on Medicare coverage, reach out to your attorney.

Getting Medicare Food Benefits

As people age, accessing healthy meals can become more challenging. According to Feeding America, one in five older adults was food-insecure in 2020. Some older adults struggle with affording healthy foods, whereas others have difficulty going to the grocery store and preparing meals when recovering from an illness or injury.

Although original Medicare does not offer food benefits, some Medicare Advantage plans provide a grocery allowance or cover meal delivery. Some programs also include nutrition education and cooking classes.

Certain Medicare Advantage plans may provide Part C food benefits in addition to Part A hospital, Part B medical, and Part D prescription drug coverage. They may also supply vision, dental, and hearing coverage. The Medicare Advantage plans available to you depend on your state.

Medicare Advantage

Medicare Advantage differs from traditional Medicare, as private companies contract with Medicare to offer Medicare Advantage plans. Plans vary, and finding insurance that fits your unique needs is essential.

Potential enrollees should also be wary of predatory marketing practices and evaluate their options before committing to a plan. Even if you qualify for a Medicare Advantage plan with food benefits, traditional Medicare could be a better option for you, depending on your circumstances.

Special Needs Plans

Special needs plans, which tailor membership to beneficiaries who meet specific criteria, offer grocery and meal benefits options.

Qualifying for grocery benefits through a special needs plan generally requires an individual to have an underlying condition. Examples of conditions that can qualify a person for Medicare Advantage food benefits include diabetes, cancer, heart disease, kidney disease, end-stage renal disease, arthritis, an autoimmune disorder, and obesity.

Grocery Benefits

When Medicare Advantage plans have grocery benefits, they typically give beneficiaries a card that they can use to check out at approved stores like Kroger and Walmart.

The benefits only cover whole foods such as vegetables, legumes, meat, and dairy, as well as pantry staples and water. Only covered food items can go on the card. Enrollees must pay out of pocket for soda, baked goods, and processed foods like chips.

Meal Delivery Services

Instead of grocery benefits, some Medicare Advantage Part C plans cover meal delivery services. Meal delivery services can benefit those who face challenges getting to the grocery store and preparing meals. A service must meet Medicare’s nutritional guidelines for Medicare Advantage to cover it.

Many Medicare Advantage plans only supply meal delivery for a set period. This type of plan can suit those discharged from a hospital or skilled nursing facility who only need help with meals for a set time.

Less common is long-term meal delivery coverage for those homebound with chronic medical conditions.

Other Meal Delivery Options

For older adults who do not qualify for a special needs program with meal benefits or who do not elect to enroll in original Medicare, alternative meal resources are available.

• Meals on Wheels is a federally funded meal delivery program for people aged 60 and above who meet location-specific eligibility requirements.
• You use the Administration for Community Living’s Elder Care Locator to find meal delivery organizations.

Speak with your attorney to access your options before selecting a Medicare Advantage program with grocery or meal benefits.

Savings for Seniors: Lower Medicare Part B Premiums in 2023

For the first time in more than 10 years, Medicare Part B enrollees will see some of their costs decline. In an announcement issued by the Centers for Medicare and Medicaid Services (CMS), the agency outlined changes to the premium, deductible, and co-payment amounts for numerous Medicare costs taking effect in 2023.

• Medicare Part B basic monthly premium = $164.90 = Savings of about $62 for the year
   
• Medicare Part B annual deductible = $226 = Savings of $84 for the year
   
• Other amounts, meanwhile, will rise slightly in 2023:
   
  • Medicare Part A deductible = $1,600 (up from $1,556)
  • Co-payment for hospital stay, days 61 to 90 = $400 per day (up from $389)  
  • Co-payment for hospital stay, days 91 and beyond = $800 per day (up from $778)
  • Co-payment for skilled nursing facility, days 21 to 100 = $200 per day (up from $194.50)

Note that beneficiaries with higher incomes pay higher monthly premiums. For further details, read the news release from CMS.

If you wish to make changes your coverage, Medicare’s Open Enrollment Period will take place October 15 through December 7. 

Comparing Traditional Medicare and Medicare Advantage

Recent research by the Kaiser Family Foundation examined the differences between traditional Medicare and Medicare Advantage. While people in either program were similarly satisfied with their care and overall care coordination, some distinctions became apparent.

Traditional Medicare’s Strengths

Traditional Medicare is a federal health insurance program for adults 65 and older and individuals with disabilities. Medicare Part A covers hospital fees, Part B applies to medical expenses, and Part D involves prescriptions.

The Foundation reviewed 62 studies released since 2016. The research findings revealed the following:

• Beneficiaries of traditional Medicare were more likely to receive cancer care in higher-quality hospitals.
• They also tended to get superior care in skilled nursing facilities and home health agencies compared with their Medicare Advantage counterparts.
• Traditional Medicare recipients may be less likely to have problems related to expenses.

Findings on Benefits of Medicare Advantage

Medicare Advantage is an alternative to traditional Medicare. It offers plans encompassing Part A hospital fees, Part B medical expenses, and Part D medicine. In some cases, the cost of Medicare Advantage can be lower, but not always. Privately owned companies contract with Medicare to provide Medicare Advantage.

According to the study:

• Some research indicated that Medicare Advantage had slightly better preventive services, providing increased access to routine health checkups, screenings, and vaccinations.
• Patients with Medicare Advantage were more likely to have a consistent health care provider.
• Medicare Advantage had lower hospital readmission rates, received more information during care transitions, and had more favorable experiences getting prescription drugs.

Switching Rates

The researchers looked at the rates at which people switched programs as a way of understanding program dissatisfaction. Medicare Advantage had a higher switching rate relative to traditional Medicare. Yet both had a low turnover, possibly suggesting that people tended to be satisfied with both programs.

Switching from Medicare Advantage to standard Medicare was more common among:

• people of color
• residents of rural areas
• those eligible for both Medicare and Medicaid
• individuals who experienced a health impairment that affected their daily functioning

Cost Issues

Beneficiaries of traditional Medicare reported higher rates of cost difficulties than enrollees in Medicare Advantage. Yet recipients of conventional Medicare with supplemental coverage had the lowest rates of expense complaints overall.

Seek Professional Guidance

Since each plan’s benefits and drawbacks can depend on individual circumstances, consider speaking to your elder law attorney before enrolling. They can explain the differences between these programs and help you plan for retirement.

Can a Nursing Home Hold Friends or Family Members Responsible For a Resident's Care?

If your loved one is entering a nursing home, you may worry whether you could be liable for their care. Under federal law, a facility cannot require a family member or friend to co-sign an admission agreement and take on personal liability. However, nursing homes around the country still try to do so, and often these matters end up in court.

What can you do to prevent this from happening to you? It starts with educating yourself on what is and is not allowed.

A law known as the Federal Nursing Home Reform Law prohibits a nursing home or facility from requiring or asking for a financial guarantee from a third party. Federal regulations regarding Medicare and Medicaid have similar restrictions.

These laws and regulations state that a home cannot have a resident’s family member or friend co-sign an admission agreement to take on financial liability. However, a nursing facility may obtain the signature of the resident’s agent, who has access to the resident’s income or assets, agreeing to use these resources to pay for care. Still, this agreement may not impose personal financial liability on the agent.

Review Before You Sign

If you are assisting a loved one with entering a nursing home, you should carefully review all the admission paperwork before you sign it. Many facilities have unscrupulous practices of using admission agreements that violate federal law or regulations.

You do not have to sign or “volunteer” to sign a financial guarantee that makes you personally responsible. It is incorrect if a nursing home claims a guarantee is necessary because the federal law only applies to Medicaid-eligible individuals. Nursing homes are also not allowed to condition admitting or keeping a person on receipt of a third-party guarantee.

Today, the most common tactic used by nursing homes is an admission agreement that obligates the signor as an agent with supposed control over the resident’s money. These agreements stipulate the agent will apply these resources to the nursing home expenses and apply for Medicaid on the resident’s behalf. Often, the person signing this document doesn’t know how to handle this situation, does not have this control, or makes mistakes in the resident’s Medicaid application, causing coverage to be denied.

What follows may be a lawsuit by the nursing home, claiming the agent violated their duties in the agreement and must pay the care costs. Courts have gone both ways on whether these agreements are enforceable, and the agent’s conduct often influences a court’s decision. Egregious conduct can lead to courts ruling in favor of the nursing home. An example is where an agent used the resident’s money for luxury items or other people’s expenses rather than their loved one’s care.

Plan Ahead As Much As Possible

The best action is to plan before nursing home care is necessary. This can put you or your loved ones in a position to be ready to apply for Medicaid should the need arise. At the same time, an aging individual can do proper asset protection planning and avoid look-back periods creditors could otherwise exploit against the resident or an agent.

However, this is not always possible for many older adults and their family members. Individuals who will take on the responsibility of being an agent should understand what this entails and seek the advice of your elder law attorney before starting the admission process.

Plan Ahead Before Seeking Nursing Home Care: Avoid Unnecessary Debt for You and Your Family

Many senior citizens may need the services of a nursing home or at-home care at some point in their life. You might assume that government assistance or health insurance will step in and cover the cost if you cannot afford these services. Unfortunately, neither health insurance nor Medicare covers long-term care. Because obtaining long-term care insurance can be very expensive, Medicaid could become your only option.

Medicaid coverage is not a given, however. If you have assets or recently transferred assets, Medicaid may determine you do not qualify for coverage until a certain amount of time has passed. If this happens, you and their family can face significant medical bills. If you cannot pay, nursing homes may take you to court to get reimbursed.

What steps can you take to avoid this? First, before applying for Medicaid, get a better understanding of the timelines in your state – known as lookback periods – that can affect your eligibility. Then you can engage in proper Medicaid or asset protection planning in advance of these timeframes. A good age to begin planning is around age 65, although everyone’s situation is different.

Individual states run Medicaid programs, and every state has different rules regarding Medicaid eligibility. These programs were designed as a payor of last resort — in other words, to qualify, you must meet strict requirements. There are two primary types of Medicaid benefits: home care and skilled nursing home care.

Lookback Periods

You must submit an application to your local Medicaid office to qualify for these benefits. As part of this process, the state will look at any money or property you may have transferred within a certain lookback period. In New York, for example, this period of time will soon be 30 months for home care and 60 months for skilled nursing care.

These lookback periods can have serious consequences. If you have not engaged in appropriate asset protection planning, you may not be able to qualify for home care or nursing home care for many months. The result is that many elderly individuals must then spend down their savings and liquidate their assets to pay privately for their home care before Medicaid starts covering anything. If a person no longer has resources and is subject to a disqualification penalty period, family members may have to step in and bear these costs on their own.

So, what can you do? The answer is to start planning as soon as is practical.

Options to Explore

Speaking with an elder law attorney can help you and your loved ones explore options available to avoid you or them being personally responsible for the costs of your care.

• Medicaid Asset Protection Trust — One common approach is placing assets in a Medicaid Asset Protection Trust. You may be able to use this to shelter various assets such as stock accounts, savings, a home with unprotected equity, and much more.
• Pooled Income Trust — Another option you may explore is contributing income that exceeds Medicaid allowances to a Pooled Income Trust. This can allow you to qualify for Medicaid while diverting excess income to a trust that pays qualified expenses on your behalf. This will enable you to benefit from the income and not spend it on things Medicaid could have otherwise covered.
• Spousal Refusal — Your spouse may also have options that can help you qualify for Medicaid. One such option includes exercising a right of spousal refusal — a process available in some states by which the income and assets of your spouse can be removed from consideration in your Medicaid eligibility analysis.

Finally, an attorney can help you understand if certain transfers are permissible under Medicaid rules without triggering a penalty period.

Without proper planning, individuals with assets and income exceeding specific state-set thresholds would have to spend this income and their assets on their care or exempt items before they can receive Medicaid benefits. For assistance in planning, consult with your attorney.

When Is a Nursing Home Eviction Legal, and What Can I Do?

Nursing home evictions, or involuntary discharges or transfers, disrupt the lives of residents, leading to homelessness, separation from familial support systems, and loss of care. As federal law covers all federally funded nursing home residents, nursing home evictions are legal only in particular instances, such as:

• The nursing home can no longer provide for a resident's needs.
• The resident does not pay for care after "reasonable and appropriate notice," which varies by state.
• The resident no longer needs care.
• The resident jeopardizes the health or safety of other residents.
• The nursing home closes.

Causes of illegal nursing home evictions

Financial motives are a significant cause of illegal nursing home evictions. When residents can no longer pay for nursing home care, some nursing homes evict residents without providing sufficient notice and time to apply for Medicaid.

Additionally, some nursing homes discharge residents early to avoid financial risks. For instance, some nursing homes remove residents transitioning from higher-paying Medicare to lower-paying Medicaid.

Other nursing homes discharge residents prematurely, suspecting residents will not pay for their stays. Medicare covers the initial 20 days of care. After 20 days, residents are responsible for copayments. A 2019 study in the Journal of the American Medical Association Internal Medicine found that nursing homes more often discharged Medicare recipients on the final day of full coverage than before or after, suggesting that some nursing homes prioritize financial considerations over resident care.

"Hospital dumping," where individuals returning from hospitalizations may find their beds taken, is another illegal practice, according to the American Council on Aging. State laws require that nursing homes hold beds open for hospitalized residents for one to two weeks. Residents receiving Medicaid are also entitled to available Medicaid-certified beds.

Other nursing homes may attempt to remove residents they perceive as disruptive or challenging, such as individuals with dementia. These facilities claim that they cannot meet the resident’s needs as a pretense for evicting them. Yet once nursing homes open their doors to residents, they have already determined they can meet residents' needs. According to the Centers for Medicaid and Medicare Services, discharging residents because nursing homes cannot provide for their needs should not be a common practice.

Dynamics between residents and nursing homes

Residents facing involuntary discharges or transfers from nursing homes may be hesitant to speak up and may not know their rights under federal law. They may feel pressure to accept discharges, even when they are not ready to go home.

If you or your loved one are facing a nursing home eviction, keep the following in mind:

• Nursing homes must provide 30-day notices of discharges. Residents do not need to depart immediately.
• In addition, residents have the right to appeal a release. They may remain in the nursing home during the appeal process unless doing so would endanger the health and safety of themselves or others.
• Nursing homes claiming to be unable to provide for a resident's needs must document why they can no longer assist the resident. Similarly, nursing homes must tell residents their reasons for discharging residents and provide these reasons in writing. Residents may request explanations of their discharges.
• A long-term care ombudsman is an official who advocates for people in nursing homes. You may contact your ombudsman through the Department of Aging in your state for assistance with nursing home evictions.  
• The national nonprofit Justice in Aging provides a useful resource on resolving common problems with nursing homes.
• For further insight and support, be sure to consult your attorney as well.

How to Get Into a Nursing Home as a Medicaid Recipient

While Medicaid helps pay for nursing home care, being admitted to a nursing home as a Medicaid recipient is not always easy. There are several ways to navigate the process, depending on your situation. 

With the median cost of a nursing home room being more than $250 a day, most families need help paying for long-term care. Medicaid is the primary method of covering the costs for nursing home care in the United States, but in order to qualify for Medicaid, an applicant must have limited income and assets. 

Generally, nursing homes will only accept patients who can pay for their care, while Medicaid will not pay for nursing home care unless an applicant is already living in a nursing home. This creates a predicament: How to get a loved one into a nursing home in order to receive Medicaid? The following are some of the methods you can use to find a nursing home that will accept your loved one:

• Private Pay. The easiest way to get into a nursing home is to be able to pay for care while the resident’s assets are spent down in order to qualify for Medicaid. Residents who can pay privately for a few months can file a Medicaid application once they are in the nursing home and start receiving benefits when the resident’s funds are below their state’s threshold for “countable assets.” Make sure the nursing home accepts Medicaid patients — and get the timing right so that the resident doesn’t run out of funds before the Medicaid application is approved. 

If the resident lacks the funds to pay for his or her own care, the resident’s family could pay. However, this is risky. The family will not be reimbursed if the resident eventually qualifies for Medicaid. It may be possible for the family to lend the money to the nursing home under a written agreement stating that the funds will be returned when the resident qualifies for Medicaid. 

• Medicare. Medicare provides nursing home coverage for up to 100 days of “skilled nursing care” per illness. The patient must enter the nursing home no more than 30 days after a hospital stay that had lasted for at least three days (not counting the day of discharge). The care provided in the nursing home also must be for the same condition that caused the hospitalization (or a condition medically related to it). In addition, the patient must receive a "skilled" level of care in the nursing facility that cannot be provided at home or on an outpatient basis. And finally, Medicare covers care only for people who are likely to recover from their conditions. If a loved one meets these conditions, it is possible for them to enter a nursing home and immediately apply for Medicaid while Medicare pays in the meantime. 
   
• Medicaid Pending. There are some nursing homes that will accept a resident who has applied for Medicaid and is awaiting a response. Unfortunately, there are only a few nursing homes that accept Medicaid pending residents without some type of payment guarantee in the event the application is denied. The nursing homes that accept Medicaid pending residents tend to be those with lower ratings for nursing home quality.  

When moving into a nursing home, be careful about signing a nursing home admission agreement. Nursing homes may try to get families to agree to pay their loved one’s bills if a Medicaid application is denied. Read any agreement thoroughly and have it reviewed by your attorney. 

Navigating the Medicaid process is complicated. If possible, consult with an attorney before entering a nursing home and applying for Medicaid.