Monday, January 30, 2006

Medicaid Bill will Limit Eligibility

The Deficit Reduction Act of 2005 (DRA), with its sweeping Medicaid provisions, is scheduled to be voted on by the House of Representatives on Wednesday, February 1. According to a report issued Friday by the Congressional Budget Office, many will lose their Medicaid eligibility if this law is passed. The Chicago Tribune says "CBO estimates that about 45,000 enrollees would lose coverage in fiscal year 2010 and that 65,000 would lose coverage in fiscal year 2015 because of the imposition of premiums. About 60 percent of those losing coverage would be children."

Two of the bill's most critical provisions are the lookback period and the limit on home equity. The lookback period is the time period during which an elderly person may not transfer assets and still be eligible for Medicaid. According to a January 13 article at ElderLaw Answers, Senate Approves Punitive Transfer Rules as Cheney Breaks Tie, "The legislation, would extend Medicaid's "lookback" period for all asset transfers from three to five years and change the start of the penalty period for transferred assets from the date of transfer to the date when the individual transferring the assets enters a nursing home and would otherwise be eligible for Medicaid coverage. In other words, the penalty period does not begin until the nursing home resident is out of funds, meaning she cannot afford to pay the nursing home. The bill also would make any individual with home equity above $500,000 ineligible for Medicaid nursing home care, although states may raise this threshold as high as $750,000."

The Chicago Tribune reports the law also "would give states sweeping new authority to charge premiums and co-payments under Medicaid."In response to the new premiums, some beneficiaries would not apply for Medicaid, would leave the program or would become ineligible due to non-payment," the Congressional Budget Office said in its report. "

In an extreme reaction, ElderLaw Answers also posed the question of holding adult children responsible for their parents' nursing home debts. In New Medicaid Law Means Adult Children Could Be on Hook for Parents' Nursing Home Bills, they theorize "If the law passes, nursing homes will likely be flooded with residents who need care but have no way to pay for it. In states that have so-called "filial responsibility laws," the nursing homes may seek reimbursement from the residents' children. These rarely-enforced laws, which are on the books in 30 states, hold adult children responsible for financial support of indigent parents and, in some cases, medical and nursing home costs."

Massachusetts does in fact have a filial responsibility law, Chapter 273, section 20. This law begins, " Any person, over eighteen, who, being possessed of sufficient means, unreasonably neglects or refuses to provide for the support and maintenance of his parent, whether father or mother, residing in the commonwealth, when such parent through misfortune and without fault of his own is destitute of means of sustenance and unable by reason of old age, infirmity or illness to support and maintain himself..." For more information on filial responsibility, see The Legal Responsibility of Adult Children to Care for Indigent Parents from the National Center for Policy Analysis, and for more information on Medicaid, visit Mass. Law About Medicaid.