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FINANCING CONNECTICUT

HOME & COMMUNITY CARE


© Attorney Sharon L. Pope
151 New Park Ave., Hartford, Ct. 06106
www.popelawfirm.net; www.ctaginginplace.com
860-236-7673

Topics covered in this 2010 outline:

Pages:
Part One: Veteran’s and their surviving spouses:
aid and attendance pension……………
2-6

Part Two: Home Care programs, for ages 65+…. 6-12


I. Medicaid Home Care Waiver (Title XIX)
II. Connecticut Funded Home Care
III. Assisted-living pilot project
IV. Demonstration projects

Part Three: Special Needs Trusts: Over asset, Over


Income? Medicaid/Title XIX & SSI.
For ages 65 or better ……………. 13-14
DISCLAIMER:

The rules for these programs are complex, technical and constantly changing. These
materials are presented as an overview of issues to aid individuals in gaining a basic
understanding of Medicaid. Material contained herein is not to be considered legal
advice to any particular person. Each person’s circumstance is unique and must be
evaluated individually. Competent legal counsel should be sought before taking any
action in reliance upon the information contained in this outline.
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Part One:

Veterans and Surviving Spouses:


Aid and Attendance Pension
Attorney Sharon L. Pope
2010
I. Here’s how it works.

A. Can a veteran or a surviving spouse of a veteran get


additional payments for long term care in an assisted living
facility, in a nursing home or at home with a home care
program?

Yes, if you fulfill the service, disability, and financial


requirements listed below you may be eligible for the Aid and
Attendance pension program. If you qualify, you will get an
additional monthly check.

B. Service Requirements

1. Veterans must have served 90 days or more of continuous


military service with at least 1 day in wartime during their lifetime
and have been discharged “Honorable” or “General under honorable”
conditions:
• World War II: Dec. 7, 1941 through Dec. 31, 1946.
• Korean War: June 27, 1950 through Jan. 31, 1955.
• Vietnam War: August 5, 1964 through May 7, 1975 (Feb. 28,
1961 for veteran’s who served “in country” before Aug. 5,
1964.
• Gulf War: August 2, 1990, through a date to be set by law of
Presidential Proclamation.

2. The veteran also must be certified by a physician as permanently


and totally disabled, although this condition does not have to be
service-connected. There are several forms which need to be
prepared.

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C. Disability Requirements

1. Available to any veteran and surviving spouse who requires the


“aid and attendance” of another person in order to, “avoid the hazards
of his or her daily life.”

2. A person in an assisted-living facility is presumed to be in need


of aid and attendance. You do not have to be bedridden or entirely
helpless. You need only show that you require this care on a regular
basis.

3. The VA will accept a letter from your private physician, with a


complete medical diagnosis, stating that the claimant has an
incapacity that requires care or assistance on a regular basis to protect
the claimant from the hazards or dangers incident to his or her daily
environment.

D. Financial Requirements

1. Assets or net worth limits:


The VA considers financial assets. Generally an applicant’s net
worth should be about $80,000 or less, if married, not counting
the home, vehicle or term life insurance. For a single claimant,
$50,000 is the approximate figure. By comparison, in
Connecticut, Medicaid limits an applicant’s assets to $1,600
and the Connecticut Funded Home care program caps assets for
a single applicant will be $32,868.00, for a couple $43,824.00.
There are also income limits on these two programs which, if
exceeded, require a contribution towards care.
The transfer of asset rules which apply to Medicaid or Title
XIX applications, do not apply here. An applicant can
transfer assets the day before the application and qualify,
without a penalty period. The VA does not inquire about
transfers prior to the date of application.

2. Income Reimbursement limits:


If all of the above requirements are met, the next question is
about countable income. What is the Veteran’s income? In
2010, the maximum for a single Veteran is $1,644.50 monthly;
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couples $1,950.00. The surviving spouse amount in 2010 is
$1056.00. These figures change annually based on the increase
for social security.

However, there are certain items deducted from the income, such as
unreimbursed or out of pocket medical expenses, such as dentist fees,
glasses, doctor’s fees, prescription drugs, therapy, health insurance,
including Medicare Part B, now $96.40 per month, (plus Medicare part
D)and supplemental health insurance premiums.

List all unreimbursed, recurring, monthly health care expenses:


• Assisted living costs __________________________
• Nursing Home costs__________________________
• Home health care services_____________________
• Health insurance premiums____________________
• Medicare premium___________________________
• Part D, RX plan______________________________
• Unreimbursed prescriptions____________________

Total expenses: _____________________

Subtract your total expenses from your total income to arrive at your
countable income: _____________________________.

Next subtract your countable income from the maximum figure listed
in D.2. above. This is the amount of monthly income the VA will
send to you.

E. Here’s how it works:

CASE ONE: A single Veteran

(income for a single veteran is $1,644.00 max. this year.)


A Veteran, who is widowed, can no longer live at home but she does
not need nursing home care. Her doctor recommends an assisted
living facility (ALF) because she does need the assistance of another
person on a regular basis. Her only income is social security income
of $1,500.00 per month. She doesn’t own a home, and she has some
savings amounting to $35,000. The ALSA fee at the ALF is
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$1,200.00 per month.(this is the fee related to the assisted living
services and paid to the assisted living services agency (ALSA); the
whole fee is $3,500 per month, for example, and includes room and
board.) She pays Medicare Part B, $96.40 a month, and the Medicare,
Part D program she selected is $28.00 a month. Due to these
expenses, she has a countable monthly income of $178.50. ($1,500
income minus the medical expenses such as: $1,200, $96.40, $28.00 =
$175.60). She would get a benefit of an additional $1,341.00
($1,644.00 - $175.60 = $1,468.40). Now her monthly income is
$2,968.40 and the ALF is much more affordable since she has some
assets to supplement her income.

CASE TWO: A surviving spouse.

(income for a surviving spouse of a veteran is $1056.00 this year)


Mrs. V. survives her husband, who was a Vet, and she now needs aid
and attendance; she could qualify for up to $1056.00 monthly. She has
$40,000 in assets. Assume her income is $1,400 from her husband’s
social security (she gets her husband’s social security if it was higher
than hers). She lives in an ALF with monthly expenses of $3,800 of
which $1,200 is for medical services or ALSA costs. She also pays
Medicare B ($96.40) and D ($28.00). Considering her deductions, her
countable income is $75.60. ($1,400 - $1,200, -$96.40, -$28.00 =
$75.60) She will get $897.75 ($1056.00- $75.00 = $980.40) and now
her total income is $2,380.04 monthly which along with her other
assets could make her stay in the ALF affordable.

F. Who can help me apply for this pension? How long does the
process take?

You can appoint a recognized service organization such as the


Disabled American Veteran’s organization or the Conn. Dept. of
Veteran’s Affairs to represent you. This is a free service.

On average, the application process takes 6-8 months to complete,


however, the benefit is retroactive from the first of the month after
the month applied for. You will get a check for the retroactive
amount.

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Also, an attorney accredited as a Veteran’s Affairs Claim Attorney
can assist with the application.

II. Important related questions: Will the Veteran’s increased income


count for other programs/benefits? Eg. Medicaid Home care, State-
funded home care?

The answer in Connecticut is YES. It’s very important to get good


advice so you select the best program for you.

Part Two:

Home Care programs, including adult day care, and assisted


living options. (for adults 65 or better)

I. Medicaid Home Care Waiver Program for Elders

The Medicaid program, originally designed as a safety net program


for the poorest people, now finances nursing home care for more than
two-thirds of Connecticut’s nursing home residents, including most
middle-class residents of nursing homes who have lengthy stays.
Medicaid also finances home care for Elders under a waiver in
Connecticut. This home care program can provide as much as 40-60
hours a week or more of home care through a combination of
companions, homemakers, and home health aids. (Medicaid also
covers prescription drugs not covered under Part D) The program also
covers Adult Day Care. The applicant is evaluated to assess his or her
needs.
(There is now a PCA (personal care assistant) component where
the individual hires his or her own workers; there are some
limitations so make sure you understand these prior to seeking
care under the PCA.)

Thus, the program now has a major impact on the financing of long
term health care. We realize that it is difficult to keep current on all of
the Medicaid regulations. The information in this paper, combined
with expert advice, can help ensure that those in need of long term
care will qualify for Medicaid assistance in a timely manner without
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falling prey to the quagmire of Medicaid rules. Swift action on the
part of the care giver can help preserve assets for the support of their
families during the course of their long-term care.

A. Primary issues for Medicaid eligibility for the home care


program
There are three primary issues that determine financial
eligibility for Medicaid: Assets, Income, and Transfer of
Assets.

1. Assets

Not all assets are counted toward the asset limit.


You should note that not all assets are counted when
determining asset limits that may be retained by the applicant
and/or the community spouse. Some assets NOT counted are:
a. A home to which the applicant intends to return or in
which the community spouse or certain family members
are living. (This applies to an applicant in rehab who will
return home).
b. An irrevocable, prepaid burial arrangement, $5,400;
Effective Oct. 1, 2004, an additional contract for
burial space may be added. Burial space is defined as
the casket, liner, or urn. Consult with your funeral
director for these details.
c. Furniture, household goods, and personal effects
d. One automobile; there is a limit on its’ value in some
cases.

Assets that are counted toward the limits discussed


below include cash and all assets that can be converted to cash
such as CDs, stocks, bonds, IRA’s, 401k’s and other
investments, life insurance that has a cash surrender value, real
estate other than the primary home, and other assets. Beware
and get good advice because some of these asset rules
changed earlier this year.

The amount of assets that can be kept by Medicaid recipients and their
families depends on whether or not the applicant is married, and if so,
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whether the applicant’s spouse is still living in the community. The
asset limitations according to the State of Connecticut are as follows:

1. Single Applicant: $1,600


2. Married applicant with a spouse at home: $1,600 for the
applicant, plus an additional allowance for the spouse, as
discussed below.

The general rule for a married applicant is that the well spouse (who is
referred to as the community spouse) can keep assets of the couple up
to a maximum amount of $109,560.00 as determined on a “snapshot
date.” This is a new law in Connecticut as of May 2010. You can
apply just to get this snapshot date and an assessment will be made as
to when this applicant needed home care services. If the applicant
was first hospitalized but then came home, the snapshot date would
typically be the initial date of hospitalization. The couple’s assets as
of the snapshot date are tallied and divided in half. These figures
change annually. However in some very limited circumstances, such
as under the “Spousal Impoverishment Rules,” the community spouse
may be able to keep a greater portion of the assets. Counsel familiar
with these rules should be consulted on this matter.

If assets need to be spent down, there are many exempt items on


which these assets can be spent: for example: home repairs &
improvements, taxes, mortgages, home equity loans; personal
property such as: furniture or appliances; irrevocable pre-paid funeral
contracts; automobiles (one of any value for the community spouse).

2. Income - Home care setting

There is an income cap for the Medicaid home care program. In 2010,
that amount is $2,022.00 gross income for the applicant only. (If the
income is social security, this usually means you have to add back in
the Medicare premium of $96.40 per month and the Medicare Part D,
to reach the gross income figure.) A spouse’s income does not count
toward this limit and the Medicaid rules do not require that the income
of the community spouse be spent on the recipient’s care. Make sure
you consider a special needs trust; this discussion in Part 3.

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The income rules are significantly different if the applicant is in a
convalescent home and the community spouse has a low monthly
income. We are now an income first state and counsel familiar with
these rules should be consulted.

3. Transfer of Assets

(Beware: there were significant changes in Conn., so you must seek


good legal counsel familiar with these rules. These changes also
reflect the significant federal Medicaid changes as a result of the
DRA (deficit reduction act signed February 8, 2006).

There can be a significant period of Medicaid ineligibility for


applicants and their spouses who have transferred assets without
receiving full value for the assets, if the transfer took place on or
after February 8, 2006. The new 5 year look-back period (a longer
period for transfers into certain trusts), and the transfer of asset rules
are just 2 of the major changes recently made to Medicaid rules. This
is a highly technical rule and must be analyzed very carefully.

An Example follows:

Dad, 87, now lives alone since mom passed away last year. He needs
some assistance with his daily activities, especially the homemaker
chores. His son who lives in the Utah, has hired someone to help Dad
with cooking and cleaning.

Dad has long wanted to gift some money to his kids and his wife had
also urged him to do so. He decides he should do this sooner rather
than later and determines to give his children these gifts during the
upcoming holiday in December, 2010. He gives each of his children, 5
in all, $25,000 and each of his grandkids, 11 in all, $1,000.00. Totally
he gifts $136,000. Right after the holidays, he suffers a serious stroke
and will now require care 24 hours, 7 days a week.

Under the new transfer of asset rules, he can apply for Medicaid
services when he is otherwise eligible, i.e. spent down to $1,600. But
the transfer of his assets will cause a period of ineligibility going
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forward. Thus, if he otherwise qualifies for Medicaid (except for these
transfers) in March 2011, the $135,000 gifts will cause a penalty
period (a period of ineligibility) over the next 13 months. It’s
calculated by dividing the total gift by the average nursing home cost
in Connecticut this year $10,366.00 (March 2011-April 2012). So Dad
will be denied benefits for over 13 months.

There are additional transfers which are exempt from these transfer rules and are
not disqualifying events; here is one common example:

An Example follows:

Mother (widowed) falls ill and can no longer care of herself. Daughter
moves in with Mom and takes care of her mother for over two years; this
care giver daughter has prevented Mom from needing nursing home care.
Mom transfers the home to her daughter. But Mom’s condition worsens and
daughter can no longer care for her at home without more assistance. Mom
is placed in a convalescent home; is Mom eligible for Medicaid? Yes,
because of a special provision of federal law which allows the transfer of the
home in this type of situation (care giver child for 2 years).

There are additional transfers which are exempt from these transfer
rules and are not disqualifying events; here are two common
examples:
1. An individual or his or her spouse may transfer his or her
home without penalty to his or her:
a. Spouse; or
b. Child under age 21; or
c. Child of any age if the child is considered to be blind or
disabled under criteria for SSI eligibility; or
d. Sibling, if the sibling:
(1) has an equity interest in the home; and
(2) was residing there for a period of at least one year
before the date the individual is institutionalized; or
e. Son or daughter, other than the one described in
subparagraph b. and c, who:
(1) was residing in the home for a period of at least two
years immediately before the date the individual is
institutionalized; and
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(2) provided care to the individual which avoided the
need of institutionalizing him or her during those two
years.

Connecticut Department of Social Services, Uniform Policy


Manual, §3028.10.

2. An individual or his or her spouse may transfer any asset


without penalty to:
a. His or her child who is considered to be blind or disabled
under the criteria for SSI eligibility; or
b. A trust, including a trust described at 4030.80 G,
established for the sole benefit of his or her child who is
considered to be blind or disabled under criteria for SSI
eligibility. (This is a Special Needs Trusts, discussed
later)

Connecticut Department of Social Services, Uniform Policy


Manual, §3028.10.

THE IMPORTANCE OF TIMING

Another important Medicaid rule is that the individual MUST meet all
of the Medicaid eligibility criteria by the last day of the month in which he
or she applies to receive any help that month. It is essential that the planner
have complete and accurate information concerning the assets owned by the
potential Medicaid applicant and his or her spouse, if married. Spending
down assets must be carefully timed to meet this deadline.

II. State-funded Connecticut Home Care Program for Elders


(CHCPE)
A. This program is designed for seniors age 65 and better in need
of supportive services in order to continue living independently
in the community. The Senior must need assistance with at
least one “critical need” for the State Funded Program. Critical
needs are: bathing, dressing, toileting, transferring,
eating/feeding, meal preparation, and medication
administration. An individual may still qualify even if someone
is currently providing assistance in any of these areas.
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B. There is no “income cap or limit” for this program. However,
you may be required to pay some fees or co-pays depending on
your income and medical expenses.
C. The asset limitations are also different from the Medicaid
program:
Individual: $32.868.00 or less; a couple: $43,824.00 or less.
D. Services provided include such things as: companion services,
adult day center, emergency response system, chore services,
home health services, and homemaker services.
To apply for either the Medicaid Waiver Home Care program or
the Connecticut Funded Home care program, call the Department of
Social Services, Alternate Care Unit at 1-800-445-5394.

III. Assisted-living pilot projects

Connecticut has a pilot project underway which utilize the home care
programs services in an assisted-living facility. The assisted-living facility
must be a participant in this pilot project; not every assisted-living facility in
Connecticut is participating. Contact Mr. Vincent Hayes, 1-860-424-5133,
DSS, Alternate Care to get on the waiting list as soon as you enter one of
these facilities. There is a long waiting list currently.

IV. Demonstration projects in Assisted-living environments

In addition, there a 4 demonstration projects which are combined with


low-income housing supports; one is in Hartford, one in Glastonbury, one in
Middletown and one in Seymour. These are new facilities. Thus, seniors
who have low incomes and could not afford private assisted-living expenses,
will find help in these low income units.

The Retreat Herbert T. Clarke House Luther Ridge


90 Retreat 25 Risley Rd. 628 Congdon St.
Hartford Glastonbury Middletown
1-860-560-2273 1-860-652-7623 1-860-347-7144

Smithfield Gardens
32 Smith Street
Seymour
1-203-888-4579

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Part Three:

SPECIAL NEEDS TRUSTS&HOME CARE PROGRAMS


WORKING TOGETHER
FOR THOSE WHO ARE DISABLED, 65 YEARS OF AGE OR
BETTER, OVER ASSET OR INCOME LIMITS FOR THE
PROGRAMS
© Attorney Sharon L. Pope

A Special Needs Trust may be your solution. This article addresses


the Medicaid Home Care Waiver program and how the Special
Needs Trust can work to keep you at home.*

Under federal law, “OBRA “93” these types of trusts


are designed to be established as a means of protecting the
beneficiary’s assets/income. The corpus of these trusts are
deemed non-countable/unavailable to the beneficiary of the
trust for Medicaid purposes and for some other programs,
such as SSI.

How can these special needs trusts, hereinafter


referred to as SNT’s, help your client stay home (or
enhance the convalescent home care experience) if the
individual is either over the income or the asset limits?

One of these types of SNT’s is available for persons


of any age, the “pooled” trust. PLAN of Connecticut is a
local trustee for the pooled trust. PLAN = Planned Lifetime
Assistance Network. www.planofct.org

In the following hypothetical case, PLAN’s pooled


trust can hold assets or income or both; you will need to
contact PLAN for details and application materials.(860-
523-4951) These can be self-funded trusts so unless the
client is conserved, you will not need any court to approve
this. You will fill out a subscriber agreement with PLAN.
PLAN will require you to obtain the services of an attorney
who is familiar with PLAN’s trust documents. PLAN does not
provide legal counsel. If you think the client is qualified
for free legal services, it’s a good idea to have the
client screened by Statewide Legal Services to see if a
referral for pro bono services is available.

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Disabled, but over assets and over income

Over-asset and over income for Medicaid Home Care


program for Elders?

Hypothetical Case

A 78 year gentleman is suffering from Alzheimer’s when his


wife dies suddenly. They did not have children, but their
neighbors have been like family to them. In order to stay
home he will need 24 hour care. He owns the home, but they
have used a reverse annuity mortgage to pay for extra care
and prescriptions over the last several years and there is
only about $30,000 more he can borrow. He also has about
$65,000 in CD’s. Unless he receives home care, plus pays
for extra care, he will have to be placed in a convalescent
home. Their next door neighbors have known him all his life
and they know his wife wanted him to stay home and that he
wants to stay home where he’s comfortable and everything is
familiar. His social security is $1,350.00 and his pension
is $690.00, totaling $2,040.00 gross(added in $96.40 for
his Medicare premium); he is $114.40 a month over the
income cap for the home care Medicaid-waiver program.
($2,022 gross, Jan. 2010). He can place his excess assets
(over $1,600) and his access income, $114.40 into a pooled
trust.

CONCLUSION:

The pooled trust can hold the assets and/or income and it
will not be counted for Medicaid purposes, thus you can
stay home or in the community even if you are over-asset or
over-income for one of the Medicaid, Title XIX, home care
programs.

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