What is a Medicaid “But For” Letter?
We talked last week about New Jersey’s Medicaid transfer penalty, but what exactly is a “but for” letter? As I explained , the Medicaid penalty doesn’t start when the transfer of assets is made, but only after the other requirements are met, meaning the application is filed and all the
When does New Jersey’s Medicaid Penalty Start?
New Jersey Medicaid determines that the Medicaid penalty begins when the applicant is below $2000 (or $4000 for some Medicaid programs), is in need of nursing home level care and applies for Medicaid, that is to say, the applicant is otherwise eligible for Medicaid “but for” the transfer of assets. For
Can Paying for Home Health Aides Cause a Medicaid Penalty (Part 2)
There are two components to properly paying a home health aide hired without the assistance of an agency: 1. Enter into a Caregiver Agreement with the aide – this agreement lays out the duties of the aide and the rate. In short, it provides New Jersey Medicaid with a record that
Can Paying for Home Health Aides Cause a Medicaid Penalty? (Part 1)
Paying private home aides “under the table” in the years immediately preceding a Medicaid application is a common trap for the unwary. Without proper documentation, New Jersey will inquire about the weekly ATM withdrawals, checks written to “cash”, or checks written to a person unknown to the case worker. The
Does New Jersey’s Medicaid Penalty Apply Only to Gifts?
When I define the Medicaid penalty for our elder law clients, they usually think only in terms of gifts. However, the penalty is triggered by much more than simply gifts. It is a transfer for less than fair value that causes a penalty. Fair value is not measured subjectively, but
How is New Jersey’s Medicaid Penalty Calculated?
In New Jersey, Medicaid calculates the transfer penalty as follows: The total amount transferred for less than fair value in the five years immediately preceding the application divided by the average monthly cost of nursing home care in New Jersey. The quotient is the number of months the Medicaid applicant
New Jersey’s Medicaid Penalty and Look Back – Not the Same Thing
Assets must be spent down to necessary limits before New Jersey Medicaid eligibility is achieved. That means that assets have to be spent for product or service of equal value. New Jersey will not take the applicant’s word for it. They require 5 years of financial records as part of
Would You Skip Homeowner’s Insurance to Save a Few Thousand Dollars?
We were discussing our VA plan and how we have clients place assets into a trust, then qualify for VA benefits and guide families on how to spend the money in the trust so we can keep eligibility for New Jersey Medicaid should it be necessary. “But, my brothers and
Disabled Child of Not? Timing is Everything (Part 2)
Last week I was telling you about Rick. His Dad transferred his home to Rick, who currently is disabled but was not at the time of the transfer. I explained to Rick that the transfer, contrary to what he believed, is subject to a Medicaid transfer penalty of 51.5 months
Disabled Child or Not? Timing is Everything
The last 2 weeks we were discussing the transfer of a home to a child who has been living with the parent in that home. But, what about transferring the home to a disabled child? Isn’t that an exception to the Medicaid transfer rules? The answer is yes, but like all