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When Disputing a Bill Can Cause You to Lose Medicaid

So many ways to get tripped up by the New Jersey Medicaid process.   Here’s another one.  Sheila called us because her husband was in a nursing home with very little money to spend down.  Combined, she and her husband, Sam, had less than $75,000.

Sheila first called towards the beginning of the month, asking how quickly she could get Sam on Medicaid.  I explained to her that in order to qualify as early as the first of the following month we had to divide their assets in half and she could keep ½.  The rest must be spent down by the last day of the month in order to qualify Sam for Medicaid as of the first of the next month.  But first we had to determine what number we are starting with, before we divide by half.

Medicaid makes that determination as of the first day of the first month of continuous institutionalization, that is, the first day of the month that Sam went into the nursing home.  Sheila was immediately able to provide me with the statements for each account they owned for that month, since the snapshot date was only two months ago.  I calculated that they had $70,000 so dividing in half would mean she could keep $35,000.  The rest would have to be spent down to $2000.  So, our target number was $37,000.

I told Sheila we could help guide her on the spend down and prepare and file the Medicaid application on Sam’s behalf but we’d have to work quickly.  Miss the $37,000 number by even a dollar and that means an extra month of nursing home care at the private pay rate of $11,000.  The consequence of missing the mark means Sheila gets to keep, at most, $26,000.  Not a whole lot for her to live on so every dollar saved is especially critical.

But, then another week went by.  Sheila didn’t hire us right away.  It was not clear that Sam would pull through his latest health crisis.  She wasn’t sure she’d need Medicaid, wasn’t sure she should commit to hiring us.  I understood completely.  I also knew, however, that if he did rally that we’d need every bit of time to position Sheila as best as we could financially.

Finally, with about ten days to go in the month, with her family’s assistance, she realized she had to go forward with Medicaid.  And as it turned out, Sam did pull through.  After paying the nursing home through the end of the month, other monthly bills and our fee, she appeared to be under $37,000.

However, when I asked her to tell me the exact amounts for which she wrote checks, something she said concerned me.  Next week I’ll tell you what it was.