Signing an Admissions Agreement on Behalf of Another (Part 2)
Signing an Admissions Agreement on Behalf of Another (Part 2) In my blog post last week, I talked about the importance of knowing what is in a long term care facility admissions agreement before you sign it. Because the resident being admitted is usually unable to handle his or her affairs, it is more often the case that someone else is signing on behalf of that person. The admissions agreement, however, is a contract. It contains various rights and responsibilities of the parties to that contract. If you sign it, even on behalf of another, you need to know what it obligates you to do. Most admissions agreements use the terms “resident”, “responsible party” and “guarantor”. We all understand who the resident is - the person who will be residing in the facility and who will pay a fee for the services provided by the facility. Responsible party and guarantor, however, are terms that are not so clearly defined. As the term suggests, the responsible party is responsible - but for what exactly? Most admissions agreements will state that the responsible party agrees to pay the resident’s bill. Usually, the person signing as responsible party is a family member and/or an agent under
Signing an Admissions Agreement on Behalf of Another (Part 1)
As I have written about often recently, the State has raised the bar significantly in terms of what an applicant needs to produce and explain in order to qualify for Medicaid. The level of increased scrutiny leads to many more failed applications and reapplications than even a few years ago. If you aren't prepared for the intensity of the process, it can lead to lost benefits. In many of those cases, especially when the applicant is single, there aren't any assets to pay the facility if Medicaid won't cover the time period you expected it would. I tell clients that there is a real risk for long term care facilities with respect to taking in residents where Medicaid is anticipated at some point. I have seen scenarios over the years in which 5 and 6 figure long term care bills are unpaid because there is no source of private payment and Medicaid could not be approved. Which is why paying close attention to what is in the facility admissions agreement before you sign it is so important. Since more often than not this agreement will be signed by someone other than the resident him/herself - usually by
Nursing Home or Assisted Living (Part 2)
In my blog post last week I began to highlight the differences between nursing homes and assisted living facilities. Understanding the differences is especially important when one has limited assets and Medicaid benefits will be needed to pay for care at some point. The private pay rate for care for both types of facilities is much higher than what they are permitted to bill for their Medicaid residents. For that reason, many facilities have private pay minimums. In the case of assisted living facilities, it is pretty standard. With limited exceptions, the private pay requirement is 2 years. This means one must pay the facility at the private pay rate for 2 years before it will make a Medicaid slot available. Most ALFs make 10% of their beds available for Medicaid so getting approved by the State must be coupled with an available slot. One without the other won’t get you Medicaid benefits. Nursing home private pay rates are more varied. Some have no minimum while others have anywhere from a few months to a year or more. People tend to focus on the lower rate for ALFs vs. nursing homes, however, if one factors the longer 2 year private pay time
Nursing Home or Assisted Living (Part 1)
I’ve written a number of blog posts over the years about the failure to recognize the the differences between nursing homes and assisted living facilities. A number of recent cases in our office highlight the point and the mistakes that can be made, specifically with regard to the impact on Medicaid. When a client has a limited amount of money and Medicaid is going to be needed, families need to understand how choosing a nursing home vs. an assisted living facility for their loved one could impact the ability. First of all, many people don’t understand that while many assisted living facilities do have memory care units that focus on caring for advanced dementia and other residents who need nursing home level care, they are licensed as assisting living facilities and not nursing homes. That means that while choosing such a facility may be the solution, it is also possible that care needs may exceed what the assisted living facility can provide. Nursing home care might then be necessary. In other words, there is a “higher” level of care option. With limited funds available the private pay requirements of the facility before Medicaid eligibility are important to understand as well. We’ll discuss
SECURE Act 2.0
At the end of 2019 Congress passed the SECURE Act which contained a number of changes to retirement accounts that I detailed in several blog posts in 2020 and then again in 2021 and 2022 as follow up regulations addressed some unanswered questions. Congress continued to tinker with IRAs and retirement plan rules with SECURE Act 2.0 which was passed by Congress as part of a $1.7 trillion spending package last week. While the new law contains incentives designed to encourage more employers to offer 401ks and other tax deferred plans to its employees and to encourage more employees to participate in such plans, it also contains changes that impact the rules with regard to withdrawing funds from retirement accounts. SECURE Act 1.0 raised the required minimum distribution age (RMD) from 70.5 to 72. That is the age by which an account owner must start withdrawing funds from his/her retirement account. SECURE Act 2.0 increases the age further. Starting in 2023 account owners must start taking RMDs when they turn 73. In 2033 the age goes up again to 75. The new law also allows, beginning in 2024, the withdrawal of up to $1000 from certain retirement plans for emergency expenses while waiving
Unexpected Medicaid Estate Recovery Hiccup (Part 3)
In this third post of three I finish telling you about the estate recovery problem we encountered with one of our clients. As I explained last week, when the client died and we asked the State what it was seeking to recover, what we got back was an amount triple what we expected. When I examined the State's printout it was immediately clear why. Medicaid was reimbursing the facility at the ventilator patient rate which is approximately triple the private pay rate for nursing residents who are not on a ventilator. My client, however, had never been on a ventilator. Clearly there had been a mistake in communication between the State and the facility. Getting the answers and more importantly getting it straightened out would take time. We had to get it corrected because as I related to you last week, the proceeds from the sale of my client's house had been placed in a special needs trust (SNT). Now that my client died, the State needed to be paid back all the benefits it paid out, or at least what was left in the SNT, if not enough to cover the full amount. If