Medicaid 101

1
Medicaid 101

• Helping VICAP Clients
• Apply for Medicaid

2
The Basics
Part I

• Medicaid Eligibility

3
What is Medicaid?

• Medicaid is an assistance program that helps pay
  for medical care. To be eligible for Medicaid,
  individuals must
• Be in one of the groups covered by Medicaid
• Have limited income and resources
• Since Medicaid is funded by the State and Federal
  governments, it is subject to both State and
  Federal regulations.

4
How Does Someone Apply for Medicaid?

• Obtain an application by
• Calling the local Department of Social Services
  (LDSS) office
• Picking up an application at the LDSS office
• Downloading and printing an application from the
  DSS web site at www.dss.state.va.us.

5
How Does Someone Apply for Medicaid?

• Complete the application
• The applicant may have assistance with completing
  the application.
• The applicant or authorized representative must
  sign the application.

6
How Does Someone Apply for Medicaid?

• Submit the application to the LDSS in the
  locality in which the applicant lives
• in person
• by mailA face-to-face interview is not required
  when applying only for Medicaid.

7
Application Processing

• The applicant will receive a letter requesting
  any required verifications.
• The eligibility worker (EW) must process the
  applications within a specified time period.
• 45 days or 90 days if a disability determination
  is required
• The applicant will receive a Notice of Action on
  Medicaid and FAMIS Programs form explaining the
  action taken, the type of coverage, and the
  appeal process.

8
How is Eligibility Determined?

• The applicant must meet all non-financial
  criteria
• Legal Presence
• Citizenship/Alien Status
• Virginia residence
• Social Security Number
• Assignment of rights

• Application for other benefits
• Institutional status
• Health Insurance Premium Payment (HIPP)
  requirements

9
How Does Eligibility for Other Benefits Affect
Medicaid Eligibility?

• The applicant must apply for any benefits he or
  she has earned the right to receive, such as
• Social Security Disability
• VA Pensions and Compensation
• Workers Compensation
• The applicant is not required to apply for
  Supplemental Security Income (SSI) in order to be
  eligible for Medicaid.

10
How is Eligibility Determined?

• The applicant must be in a covered group.
• All covered groups fall into one of two broad
  groups, each with its own set of policies
• Aged, Blind and Disabled (ABD)
• Families and Children (FC)

11
How is Eligibility Determined?

• Medicaid coverage for older adults and adults
  with disabilities is under the ABD group
• Aged 65 years or older
• Blind SSI definition (having best corrected
  central visual acuity of 20/200 or less in the
  better eye)
• Disabled Social Security Administration (SSA)
  definition

12
Applicants with Disabilities

• The disabled or blind covered groups include
  individuals who
• receive Social Security Disability benefits
• receive SSI based on blindness or disability
• have been determined to be blind by Va. Dept. for
  the Blind and Vision Impaired
• receive Railroad Retirement benefits due to a
  disability.

13
What if There Has Not Been a Disability
Determination from SSA?

• If an applicant with blindness or a disability is
  not receiving Social Security or Railroad
  Retirement total disability benefits and has not
  been denied disability or has not had disability
  determined by Disability Determination Services
  (DDS), the EW makes a referral to DDS.

14
Referral to DDS

• The applicant must complete the Disability Report
  (SSA-3368-BK)
• The applicant must sign an Authorization to
  Disclose Information to the Social Security
  Administration (SSA-827-02-2003)
• Due to HIPAA requirements, the applicant will be
  asked to sign multiple copies.
• Each provider must have an original signature

15
Referral to DDS

• Eligibility Worker (EW) completes DDS Referral
  Form and forwards to DDS along with Disability
  Referral Cover Sheet and Authorizations.
• DDS obtains necessary medical records.
• DDS advises EW of the applicants disability
  status as soon as it is determined.
• DDS provides EW with a notice to be sent to the
  applicant advising him/her of the outcome of the
  disability determination.

16
Disability Decisions

• The SSA disability decision made within the past
  12 months is final for Medicaid purposes unless
• the applicant alleges a condition that is new or
  in addition to the condition already considered
  or
• the applicant alleges the condition has changed
  or deteriorated, causing a new period of
  disability and
• The applicant no longer meets the SSI financial
  requirements but might meet the Medicaid
  requirements or
• The applicant applied to SSA for a
  reconsideration or a reopening and SSA refused to
  reopen the case.

17
Disability Decisions - Denials

• If the applicant does not meet another covered
  group, his Medicaid application must be denied.
• Disability denials may be appealed.
• If the SSA reverses the decision, the EW will
  reevaluate the denied Medicaid application.
• Medicaid entitlement is based on the Medicaid
  application date, but eligibility as a disabled
  individual cannot begin prior to the disability
  onset date.

18
How is Eligibility Determined?

• The applicant is first evaluated for full
  coverage.
• Includes hospital care, doctors visits,
  prescriptions for those not entitled to Medicare,
  and transportation to receive covered services
• Also includes payment of Medicare premiums,
  deductibles, and copayments for Medicare
  beneficiaries

19
How is Eligibility Determined?

• If the applicant is not eligible for full
  coverage, he or she may receive limited coverage
  if he/she has Medicare.
• Qualified Medicare Beneficiary (QMB) Medicaid
  pays for Medicare Part A and B premiums,
  co-payments, and deductibles
• Special Low-Income Medicare Beneficiary (SLMB)
  and Qualified Individuals (QI) Medicaid pays
  for Medicare Part B premiums only

20
Medicaid Medicare Prescription Drug Coverage

• Medicaid cannot cover prescriptions for
  individuals who are enrolled in/entitled to
  Medicare.
• Dual Eligibles (full Medicaid Medicare), QMBs,
  SLMBs, and QIs are deemed eligible for Extra Help
  subsidy for out-of-pocket costs associated with
  Medicare Part D Prescription Drug Coverage.
• Are auto-enrolled or facilitated with enrollment
  in prescription drug plan.

21
What Determines Full or Limited Coverage?

• Full Coverage
• Resource Limit 2,000 for an individual or
  3,000 for a couple
• Countable Income (after allowable deductions)
  must be within limit for covered group
• For ABD 80 Federal Poverty Level
• In 2006, 654 for individual 880 for couple

22
What Determines Full or Limited Coverage?

• Limited Coverage (QMB, SLMB, QI)
• Resource Limit 4,000 for an individual or
  6,000 for a couple
• Countable Income (after allowable deductions)
  must be within limit for covered group

23
2006 Income Limits

• QMB lt 100 FPL
• 817 for individual 1,110 for couple
• SLMB gt 100FPL but lt 120 FPL
• 980 1,320
• QI gt 120 FPL but lt 135FPL
• 1,103 1,485

24
Medicaid Supplemental Security Income (SSI)

• In Virginia, an SSI recipient who wishes to
  receive Medicaid must also apply for
  Medicaid--enrollment is not automatic!

25
Why is Medicaid not automatic for SSI recipients
who live in Virginia?

• The real property eligibility requirements for
  Medicaid in Virginia are different than the real
  property eligibility requirements for SSI.

26
Medically-Needy (MN) Spenddown

• Applicants who meet all other Medicaid
  requirements except income are placed on a MN
  spenddown and may be able to receive a period of
  full coverage. When the period is up, the
  spenddown must be met again.
• The income limit for MN is based on the
  applicants locality and is lower than for other
  ABD covered groups.

27
MedicaidLong-term Care (LTC)
Part II

• Nursing Facility (NF) and Community-based Care
  (CBC)

28
Community-based Care

• Most older adults in CBC receive services under
  the Elderly and Disabled with Consumer-direction
  (EDCD) Waiver
• Personal care,
• Respite care, and/or
• Adult day health care
• Personal Emergency Response System (PERS)
• Other Waivers have different admission processes.

29
Prescreening

• Completed by local DSS Social Worker and Health
  Department RN or hospital staff.
• Universal Assessment Instrument (UAI) is used.
• Not required when person is in nursing facility
  at time of application or has been in nursing
  facility for at least consecutive days.

30
Eligibility for LTC Services

• Must meet regular eligibility rules special LTC
  rules
• Non-financial, resources, income
• Asset transfer
• Substantial home equity
• Resource eligibility considerations
• Single or married?
• Is spouse living in the community in a home
  couple owns?

31
Resource Assessment (RA)

• Is a determination of spousal share of couples
  resources.
• Only for institutionalized applicant with a
  community spouse who had the first continuous
  period of institutionalization (gt30 days) on or
  after 9/30/1989.
• Can request RA prior to application for Medicaid.
• Only one RA is completed.

32
Income Eligibility

• Income limit lt 300 of SSI payment for one
  person.
• In 2006, 1,809 per month.

33
Patient Pay

• Patient Pay gross income allowances
• Allowances differ for nursing facility and CBC
  patients
• NF 30 personal needs allowance
• CBC 995 personal maintenance allowance
• Other allowances include health insurance
  premiums, non-covered medical expenses, community
  spouse and dependent child allowances,
  guardianship fee, earned income

34
Deficit Reduction Act of 2005Changes
Part III
35
Deficit Reduction Act (DRA)of 2005

• Signed into law by President Bush on 2/8/06.
• Imposes new requirements to document citizenship
  and identity beginning 7/1/06.
• Impacts ABD resource policy
• Annuities
• Continuing care retirement community (CCRC)
  entrance fees
• Changes LTC policy
• Substantial home equity
• Transfer of assets on or after 2/8/06
• Annuities
• Community spouse income first rule

36
DRA Citizenship and Identity

• Effective 7/1/06, States are required to obtain
  documentary evidence of citizenship and identity
  from all applicants for and recipients of
  Medicaid.
• For applicants, must be obtained at time of
  application for Medicaid.
• For recipients, must be obtained at time of first
  renewal on or after 7/1/06.
• Once satisfactory evidence is obtained, no
  further requirement to obtain additional
  documentation.

37
DRA Citizenship and Identity

• SSI recipients and Medicare Beneficiaries are
  exempt from providing documentation of
  citizenship and identity because the SSA has
  already documented this information. This
  includes former SSI recipients.

38
DRA Citizenship and Identity

• At time of application or renewal, individuals
  must given a reasonable opportunity period to
  provide any necessary documentation of
  citizenship and identity.
• Federal regulations allow for additional time
  when receipt of required information has been
  delayed due to circumstances beyond the
  individuals or agencys control.

39
DRA Citizenship and Identity

• An extension of 30 calendar days may be granted
  when the applicant/recipient has
• requested, but not received the required
  documents, or
• requested assistance in obtaining documents.
• An additional extension of up to 10 working days
  may be granted at the end of the 30-day extension
  when there is documentation that the information
  has been requested, but has not been received.
• If the required information has not been received
  by the end of the extensions, appropriate action
  to deny or cancel coverage must be taken.

40
DRA Citizenship and Identity

• Individual who provides a citizenship and
  identity document (documents that include a
  picture) will not have to present any other
  documentation.
• Individual who provides citizenship only document
  will also have to provide identity document.
• One-time activity once documented and recorded,
  additional information is not required at renewal
  or reapplication.
• List of acceptable documents on VDSS web site
  www.dss.virginia.gov

41
DRA Citizenship and Identity

• Compliance
• An applicant or recipient who does not cooperate
  with the requirement to present documentary
  evidence of citizenship may be denied eligibility
  or terminated.
• Individuals denied or terminated must be sent the
  appropriate notice giving appeal rights.

42
DRA Resources

• Annuities
• Applies to annuities purchased on or after
  2/8/06.
• Ownership of all annuities must be disclosed on
  application added to the new Application for
  Benefits.

43
DRA Annuities

• Annuities
• Must be issued by bank, insurance company or
  other registered or licensed entity approved to
  do business and authorized to sell annuities in
  the Commonwealth.
• If issued in state other than Commonwealth, must
  be issued by an entity licensed to do business in
  the state in which the annuity is established.

44
DRA Annuities

• Annuities
• EW must send copies of all annuity agreements to
  DMAS for review.
• DMAS may notify insurer of the right of the
  Commonwealth to be named as the preferred
  beneficiary.

45
DRA Resources

• Continuous Care Retirement Center (CCRC) Entrance
  Fees
• Countable resource when individual
• can use fee to pay for care if other resources or
  income is insufficient to pay for care
• is eligible for a refund at death or when leaving
  the CCRC and
• does not receive an ownership interest in CCRC
• Countable amount is amount that could be
  refunded no requirement to seek refund.
• Payment of CCRC entrance fees are not subject to
  transfer of assets evaluation.

46
DRA LTC

• Substantial Home Equity
• Individuals with equity in excess of 500,000 are
  not eligible for Medicaid payment for LTC
  services unless home is occupied by
• Spouse
• Dependent child under age 21
• Blind or disabled child of any age
• Applies to nursing facility and CBC patients who
  meet the requirements for LTC on or after 1/1/06.
  Does not apply to recipients approved for LTC
  prior to 1/1/06 who maintain continuous
  eligibility. Applies to all applications and
  renewals for cases approved on or after 1/1/06.
  
• Home equity does not impact Medicaid coverage for
  other services

47
DRA LTC

• Substantial Home Equity
• Applies to home property as defined in Medicaid
  Eligibility Manual.
• Assessed value must be obtained.
• Equity value is the assessed value minus any
  encumbrances, including liens and reverse
  mortgages that are in effect. Encumbrances
  against the property must be verified.
• Line of credit with no payment in effect does not
  reduce equity value.

48
DRA LTC

• Substantial Home Equity
• There will be an undue hardship provision for
  individuals denied Medicaid payment for LTC
  services due to substantial home equity.

49
DRA LTC

• Transfer of Assets
• Rules for asset transfers that occurred on or
  after 8/11/1993 and before 2/8/06 remain
  unchanged.

50
DRA LTC

• Transfer of Assets
• Transfers that have a cumulative value less than
  or equal to 1,000 per calendar year will not be
  considered a transfer for less than fair market
  value and no penalty period will be imposed.

51
DRA LTC

• Transfer of Assets
• Transfers that have a cumulative value of greater
  than 1,000, but less than or equal to 4,000 per
  calendar year may not be considered an
  uncompensated transfer if documentation is
  provided that establishes pattern existed for at
  least 3 years prior to requesting Medicaid for
  payment of LTC services. Examples include
• Gifts (holiday, birthday, wedding, graduation,
  etc).

52
DRA LTC

• Transfer of Assets
• New policy for transfers on or after 2/8/06
  changes
• Treatment of promissory notes, loans, mortgages,
  purchases of life estates and annuities
• Look-back period
• Period of ineligibility
• Begin date of penalty
• Partial months ineligibility
• Undue Hardship

53
DRA LTC

• Promissory Notes, Loans, or Mortgages obtained on
  or after 2/8/06
• Evaluate as an uncompensated transfer unless
• repayment is actuarially sound,
• provides for fixed, equal payments with no
  deferral or balloon payments, and
• prohibits cancellation of balance upon death of
  lender.
• Uncompensated amount is the outstanding balance
  as of the date of the individuals application
  for Medicaid.
• Countable value as a resource is the outstanding
  principal balance for the month for which a
  determination is being made.

54
DRA LTC

• Life Estates obtained on or after 2/8/06
• Funds used to purchase a life estate in another
  individuals home must be evaluated as an
  uncompensated transfer unless the purchaser
  resided in the home for at least 12 consecutive
  months.
• If the purchaser resided in the home for less
  than 12 consecutive months, the entire amount of
  the purchase is considered a transfer for less
  than fair market value.

55
DRA LTC

• Annuities purchased by institutionalized or
  community spouse on or after 2/8/06 will be
  treated as uncompensated transfer unless
• Commonwealth is named as the beneficiary on all
  annuities when individual requests LTC
• Owned by single individual, Commonwealth must be
  named as primary beneficiary
• Owned by married individual with CS, Commonwealth
  must be named as beneficiary behind the CS/minor
  or disabled child
• Owned by CS, must name Commonwealth as primary
  beneficiary if no minor or disabled child
• Owned by CS with a minor or disabled child, must
  name Commonwealth as secondary beneficiary.

56
DRA LTC

• Annuities - annuities owned by an
  institutionalized individual and purchased on or
  after 2/8/06 will be considered an uncompensated
  transfer unless the annuity
• is irrevocable and non-assignable,
• is actuarially sound, and
• provides for payments in equal amounts during the
  term of the annuity, with no deferral or variable
  payments (no balloon).

57
DRA LTC

• Annuities
• owned by an institutionalized individual and
  purchased on or after 2/8/06 which
• are described in subsection (b) individual
  retirement annuities or (q) deemed IRAs under
  qualified employer plans of section 408 of IRS
  Code of 1986
• OR

58
DRA LTC

• are purchased with the proceeds from
• an account or trust described in subsection (a)
  individual retirement account ( c ) accounts
  established by employers and certain associations
  of employees or (p) simple retirement accounts of
  section 408 of such Code
• a simplified employee pension within the meaning
  or section 408 (k) of such Code, or
• a Roth IRA
• will be considered an uncompensated transfer
  unless the Commonwealth is named the primary
  beneficiary.

59
DRA LTC

• Annuities
• If uncompensated transfer and penalty period is
  established, Medicaid will not pay for LTC costs.
• DRA provisions do not apply to annuities
  purchased with the assets of a third party (legal
  settlements).

60
DRA LTC Transfers-Look-back Period

• Prior to 2/8/06
• For trusts, 60 months before the first date
• the individual is both an institutionalized
  individual and has applied for Medicaid to cover
  his LTC services.
• For all other transfers, 36 months.

• On or after 2/8/06
• For all transfers, 60 months before the first
  date the individual is both an institutionalized
  individual and has applied for Medicaid to cover
  his LTC services.

61
DRA LTC-Transfers Penalty Period

• Prior to 2/8/06
• For Applicants
• Begins on first day of month of transfer
• For Recipients
• begins month following month of transfer

• On or after 2/8/06
• For Applicants
• Begins first day of the month the
  institutionalized individual would be eligible
  for Medicaid payment of LTC services except for
  imposition of the penalty
• For Recipients
• begins month following month of transfer

62
DRA LTC Transfers Partial Month Penalty Period

• On or after 2/8/06
• There can be a partial month penalty period.
• Penalty period is calculated without dropping
  fractional portion of the month.

• Prior to 2/8/06
• No partial month penalty period.
• Once penalty period is calculated, drop any
  fractional portions.

63
Penalty Period Calculation for Transfers that
Occurred On or After February 8, 2006

• In order to calculate a penalty period for an
  uncompensated transfer that occurred on or after
  February 8, 2006, the amount of the uncompensated
  transfer is divided by the average private
  nursing facility monthly rate at the time of the
  individuals application for Medicaid, and the
  remainder is divided by the daily rate (monthly
  rate divided by 31).
• The penalty period begins with the month the
  applicant is both institutionalized and eligible
  for Medicaid. Individuals are responsible for
  paying the cost of care until their penalty
  period expires.
• Medicaid begins paying for long-term care
  services after the penalty period expires.

64
Penalty Period - Example

• An individual makes an uncompensated transfer of
• 30,534 in April 2006, the same month he applies
  for Medicaid.
• The uncompensated transfer amount of 30,534 is
  divided by the average monthly rate of 4,060 and
  equals 7.52 months.
• The full 7-month penalty period runs from April
  2006, the month he applies for Medicaid as an
  institutionalized individual and meets the
  requirements, through October 2006 with a partial
  month penalty calculated for November 2006.
• The partial month penalty for November is
  calculated by dividing the partial month penalty
  amount by the daily rate.

65
Example - Continued

• The calculations are as follows
• Step 1 30,534.00 uncompensated transfer
  amount
• 4,060.00 average monthly nursing facility
  rate at time of application
• 7.52 penalty period
• Step 2 4,060.00 average monthly nursing
  facility rate at time of application
• 7 seven-month penalty period
• 28,420.00 penalty amount for seven full
  months

66
Example - Continued

• Step 3 30,534.00 uncompensated amount
• - 28,420.00 penalty for seven full months
• 2,114.00 partial month penalty amount
• Step 4 2,114.00 partial month penalty amount
• 130.97 daily rate (4,060 31)
• 16.14 number of days for partial month
  penalty
• For November 2006, the partial month penalty of
  16 days would be added to the seven (7) month
  penalty period. This means Medicaid would
  authorize payment for LTC services beginning
  November 17, 2006.

67
DRA LTC

• Undue Hardship
• Exists when applying transfer of assets penalty
  would deprive the individual of medical care such
  that his health or life would be endangered.
• Also exists when applying transfer of assets
  penalty would deprive the individual of food,
  clothing, shelter, or other necessities of life.

68
DRA LTC

• Undue Hardship
• All individuals who have transferred assets
  without receiving adequate compensation must be
  notified that
• Undue hardship can be claimed and the process for
  requesting an undue hardship.
• Written information must be provided that
  documents that the resources transferred cannot
  be recovered.
• Documentation must clearly substantiate the
  immediate adverse impact of the denial of
  Medicaid coverage of LTC services and would
  result in the individual being removed from the
  institution or unable to receive life sustaining
  medical care, food, clothing, shelter, or other
  necessities of life.

69
DRA LTC

• Undue Hardship
• Requests for undue hardship must be sent by local
  DSS to DMAS, for an evaluation.
• The individual, his personal representative or,
  if authorized by the individual, the nursing
  facility can file an undue hardship request.
• DMAS will evaluate and provide local DSS with a
  decision.
• Denial of a claim for undue hardship may be
  appealed.

70
DRA LTC

• Income First Rule
• All income of the institutionalized spouse that
  could be made available to the community spouse
  (CS) in calculating the CS income allowance must
  be made available before resources are allocated
  by DMAS hearing officer.
• Virginia was already doing this.

71
For Additional Information

• Contact the Local Department of Social Services
  office in the city or county where the individual
  lives
• For questions about applying for Medicaid and to
  request applications and Fact Sheets about
  Medicaid eligibility
• To report changes in income or resources and for
  questions about continuing eligibility
• Local DSS contact information available online at
  www.dss.virginia.gov
  
  

72
VDSS Medical Assistance Unit StaffStephanie
Sivert, Program Manager(804) 726-7660

• VDSS Home Office
• Susan Hart [phone]
• Diane Drummond [phone]
• Sandy Gilbert [phone]
• Sherry Sinkler-Crawley [phone]

• Regional Field Offices
• Abingdon - Sharon Craft(276) 676-5639
• Roanoke - Lois Brengel(540) 857-7947
• Roanoke - Judy Ferrell(540) 857-7972
• Virginia Beach - Johnical Owens [phone]
• Warrenton - Donald McBride(540) 347-6326

73
No matter how you say itfor all you do,