September 2006 VDSS 1 Medicaid 101 Helping VICAP Clients Apply for Medicaid.

September 2006VDSS

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Medicaid 101

Helping VICAP Clients Apply for Medicaid

September 2006VDSS

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The Basics

Medicaid Eligibility

Part I

September 2006 VDSS 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.


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.

http://www.dss.state.va.us/



Complete the application

– The applicant may have assistance with completing the application.

– The applicant or authorized representative must sign the application.



Submit the application to the LDSS in the locality in which the applicant lives:– in person

– by mail

A face-to-face interview is not required when applying only for Medicaid.


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.


How is Eligibility Determined?• The applicant must

meet all non-financial criteria:

Legal PresenceCitizenship/Alien

StatusVirginia residenceSocial Security

NumberAssignment of rights

Application for other benefits

Institutional statusHealth Insurance

Premium Payment (HIPP) requirements


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– Worker’s Compensation

• The applicant is not required to apply for Supplemental Security Income (SSI) in order to be eligible for Medicaid.


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 (F&C)


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


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.


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.


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


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 applicant’s 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.


Disability Decisions• The SSA disability decision made within the past 12

months is final for Medicaid purposes unless:

A. the applicant alleges a condition that is new or in addition to the condition already considered or

B. 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.


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.



• The applicant is first evaluated for full coverage.– Includes hospital care, doctor’s 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



• 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


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.


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


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


2006 Income Limits

• QMB: < 100% FPL– $817 for individual; $1,110 for couple

• SLMB: > 100%FPL but < 120 FPL– $980; $1,320

• QI: > 120% FPL but < 135%FPL– $1,103; $1,485


Medicaid & Supplemental Security Income (SSI)

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


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.


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 applicant’s locality and is lower than for other ABD covered groups.

September 2006VDSS

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MedicaidLong-term Care (LTC)

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

Part II


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.


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.


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?


Resource Assessment (RA)

• Is a determination of spousal share of couple’s resources.

• Only for institutionalized applicant with a community spouse who had the first continuous period of institutionalization (>30 days) on or after 9/30/1989.

• Can request RA prior to application for Medicaid.

• Only one RA is completed.


Income Eligibility

• Income limit < 300 % of SSI payment for one person.– In 2006, $1,809 per month.


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

September 2006VDSS

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Deficit Reduction Act of 2005

Changes

Part III


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


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.


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.


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 individual’s or agency’s control.


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.


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

http://www.dss.virginia.gov/


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.


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.


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.


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.


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.


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


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.


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.


DRA LTC

• Transfer of Assets – Rules for asset transfers that occurred on

or after 8/11/1993 and before 2/8/06 remain unchanged.


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.


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).


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


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 individual’s application for Medicaid.

– Countable value as a resource is the outstanding principal balance for the month for which a determination is being made.


DRA LTC• Life Estates obtained on or after 2/8/06

– Funds used to purchase a life estate in another individual’s 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.


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.


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).


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


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.


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).


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.


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


DRA LTC Transfers Partial Month Penalty Period

Prior to 2/8/06

• No partial month penalty period.

• Once penalty period is calculated, drop any fractional portions.

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.


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 individual’s 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.


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.


Example - ContinuedThe 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


Example - ContinuedStep #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.


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.


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.


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.


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.


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

http://www.dss.virginia.gov/


VDSS Medical Assistance Unit Staff

Stephanie Sivert, Program Manager(804) 726-7660

• VDSS Home Office : – Susan Hart

(804) 726-7363

– Diane Drummond (804) 726-7390

– Sandy Gilbert (804) 726-7397

– Sherry Sinkler-Crawley (804) 726-7367

• 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

(757) 491-3983– Warrenton - Donald McBride

(540) 347-6326


No matter how you say it…for all you do,

September 2006 VDSS 1 Medicaid 101 Helping VICAP Clients Apply for Medicaid.

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Transcript of September 2006 VDSS 1 Medicaid 101 Helping VICAP Clients Apply for Medicaid.