Medicaid Planning and Nursing Home Costs in Rhode Island
Contact the Rhode Island Medicaid Planning Attorneys at The Law Offices of Howe and Garside, Ltd. At 401-841-5700 or via EMAIL HERE.
Medicaid covers a variety of programs but when we speak of “Medicaid Planning” or “Nursing Home Planning” we are most often discussing long-term care. About 49% of all long-term care is financed by Medicaid. Medicaid is a federal-state program and states have wide discretion in how they will administer Medicaid in their state. Rhode Island is an “SSI State”. In RI a person receiving SSI is automatically eligible for Medicaid and the income and resource rules of SSI are used to determine Medicaid eligibility. Other individuals who qualify are “medically needy” individuals. They are allowed to “spend down” excess income for medical expenses to qualify for Medicaid. They can also spend down by paying off debts, paying for services, prepay funeral expenses, pay real estate taxes, purchase an automobile, converting an IRA to a Roth IRA, making home improvements, buying household goods or personal effects.
Some programs provide “Home or Community-based Services” (HCBS) for those who would require nursing home care but for the program. Assisted living costs and nursing home costs are covered under a Medicaid waiver program.
Most Medicaid Planning looks to the resources of the individual (and the spouse ). Not all resources are counted although all resources are disclosed. “Countable Resources” can be converted to “noncountable resources”. Some assets are noncountable resources because they are exempt such as: One automobile, the family home if the applicant “intends to return home”, property used in a trade or business, property used for self-support or employment and personal effects and household goods up to $2,000, an account of $4,000, wedding and engagement rings, life insurance with a face value of $1,500 or less. Certain income producing property is also exempt. “Qualified” assets such as an IRA are not countable assets. The “community spouse” who still resides at home is entitled to a “Minimum Monthly Maintenance Needs Allowance (MMMNA)”. In October, 2011 it was raised to a maximum of $2,841 per month and a minimum of $1,828.75. The MMMNA may be increased at a “Fair Hearing”. The Community Spouse Resource allowance (the CSRA) provides for the pooling and division of the resources of husband and wife and allows the “community spouse” to retain a share of the couple’s countable resources. This is composed of countable resources only. The new minimum CSRA in Rhode Island is $22,728 and the new maximum is $113,640. This is in addition to the $4,000 that the institutional spouse may retain. The minimum and maximum home equity limits used by Medicaid have increased to $525,000 and $786,000, respectively.
The Medicaid “look-back period” for transfers of assets is 60 months if the transfer occurred after February 8, 2006. In cases where it is too late to transfer assets there are transfer strategies used by Medicaid planners. There are risks and costs also when assets are irrevocably transferred so it is wise to consult an expert before transferring any asset. There are exempt transfers from the period of ineligibility such as transfers of the family home in certain circumstances, transfers to the community spouse, transfers to a blind or permanently and totally disabled child. There are transfers for value not subject to penalty such as: the purchase of an annuity; a “self-cancelling Installment Note (SCIN), the sale of a remainder interest in a home, modification of a child’s home for the parent before the need for a nursing home, reimbursement of a pro rata share of expenses, compensation for caregiving services and cost of other living arrangements. Medicaid planners also consider the use of a reverse mortgage or a family reverse mortgage and non-negotiable promissory notes.
The foregoing list is not exhaustive and any person or family who wishes to begin planning with reference to Medicaid should remember: “The sooner the better!”
The Law Offices of Howe and Garside LTD are staffed by Rhode Island Medicaid Planning Attorneys serving clients in RI towns surrounding Newport RI such as Middletown, Portsmouth, Jamestown, North Kingston, South Kingston, Wakefield, Tiverton, and beyond.
2015 MEDICARE COSTS. A Quick Summary.
I. Medicare Part A (Hospital Insurance) costs.
Free if you paid for it during your working years. It can cost up to $407 per month.
You pay: $1,260 deductible per benefit period
$0 day 1 to day 60
$315 day 61 to day 90
$630 per day after day 90 (no more than 60 days
in your lifetime)
Skilled Nursing Facility
You pay: $0 day 1 to day 20
$157.50 days 20 to day 100
All costs after day 100
II. Medicare Part B (Medical Insurance) costs.
Part B Medical Premium
You pay: A premium every month. Based upon your income 2 years prior so 2015 premiums are based upon 2013 Modified Adjusted Gross Income (MAGI). See Medicare Chart.
Amount is $104.50 per month for most
Up to $335.70 per month if MAGI is greater than $214,000/individual or $428,000 joint.
III. Medicare Advantage Plans Part C.
Visit Medicare.gov/find-a-plan for premiums
IV. Prescription Drug Plans Part D.
Monthly Premiums are income based. They depend upon your plan and then you pay an “adjustment amount” up to an additional $70.80 per month plus your premium if you earn more than the base incomes of $85,000/, individual or $170,000 MAGI.
[If you want a copy of the “2015 Medicare Costs” with yearly income charts, email Howe and Garside at email@example.com
Nursing Home Planning
Clients often come to us for planning advice when a spouse, parent or other loved one is on the verge of entering a nursing home. Just as frequently, we hear of people who’ve never bothered to seek legal advice for a loved one who is already in the nursing home, simply because they weren’t aware that there was any planning that could be done. We are able to help clients in both situations.
Today, the monthly cost of a nursing home can be as much as $10,000. For most, that expense is likely to deplete one’s life savings quite rapidly. Although a nursing home resident’s house will never be taken while they reside in the nursing home, the state may have a lien against the person’s home upon their death. This is avoidable in some circumstances.
It is crucial that people discuss nursing home questions with someone who knows and understand the current Medicaid rules. With proper planning, we can assist clients in preserving their hard-earned life savings to the maximum extent allowed by law.
Contact us today if you or someone you know would benefit from learning about these opportunities.
Contact the Rhode Island Medicaid Planning Attorneys at The Law Offices of Howe and Garside, Ltd. At 401-841-5700 or fill out our form on the left side of this page.