When a loved one enters long-term care in a nursing home, if they insufficient assets to pay for the full term of their long-term of their long-term care and healthcare. If so, that resident and the resident’s family members must contemplate the prospect of filing a nursing home Medicaid application. The application is made to the applicable Medicaid office, the Medicaid application is assigned to a state Medicaid caseworker to begin the application process. If all of the Medicaid eligibility criteria has been met, the application will be approved, and the resident will continue to receive the care they require, and the payment for that care will proceed smoothly.
In most cases, and at QMC in ALL cases, Medicaid applications are not filed until there is assurance that the applicant fully qualifies for Medicaid nursing home care. And that is the best route in all cases: a Medicaid application for Medicaid benefits should always meet all Medicaid requirements before it is even submitted.
But, on occasion, even the best laid plans go astray, and a family receives a Medicaid denial notice of ineligibility. The most common reasons that Mediaid applications are denied:
Full information was not provided to the Medicaid program. If a Medicaid application is incomplete, typically the state Medicaid caseworker will issue a Request for Information (RFI) outlining the missing documentation. If it is clear that the attempt to file for Medicaid coverage was an honest effort made in good faith, and a great deal of required detailed information has been submitted, a refusal to enter the application into the system for processing rarely happens. The application is accepted for processing, and the RFI for the missing supporting documentation is sent to the resident and resident family member. Ultimately, if that required additional information (bank statements, tax returns, Social Security statements, Medicare care, etc. perhaps) is not received, a denial letter will be issued.
The applicant held too much in the way of assets, is over the applicable asset limit, and thus in violation of the Medicaid rules. Often the Medicaid denial is due to the fact that the Medicaid applicant is over the applicable countable asset limit (fyi, there are no income limits). In Missouri, the applicable asset limit for a person requiring long-term care in a Medicaid nursing facility is currently $5,800. The asset limit eligibility requirements are very strict. The assets held by the resident must be under the applicable asset limit, and not one penny over.
The resident has made previous gifts within the Medicaid lookback period, thus creating a penalty period before qualifying for full enrollment in the Medicaid program. Medicaid highly restricts a prospective Medicaid coverage recipient’s ability to make asset transfers at less than fair market value in order to hasten the application date and the Medicaid coverage date, instead of using those funds on care. Any improper gift made within 5 years of the Medicaid application date, will cause a penalty period before Medicaid will begin and a denial of immediate Medicaid eligibility.
The applicant does not physically qualify to receive full custodial care. In order to receive Medicaid, the prospective resident must be assessed to determine whether or not the Medicaid applicant truly needs full long-term custodial care. This task is the responsibility of the nursing home, as the nursing home typically provides detailed information to the state’s Medicaid office, and it is rare that Medicaid coverage is denied because of a lack of a need for full care, but it is good to keep this requirement in mind, and to discuss this matter with the nursing home staff before the Medicaid application is filed.
For a Home and Community Based Medicaid application, the applicant can be denied because of excess income. Unlike nursing home Medicaid, Medicaid for home care does have a maximum income limit, and denial can be issued based on excess income. However, this income issue can be addressed with the creation of a qualified income trust, also known as a Miller Trust. With the qualified income trust, a portion of the applicant’s income must be used on care before the Medicaid coverage will begin. This should be addressed prior to the Medicaid application filing, but if it is not, a denial can be issued.
If the denial was issued improperly, or the issue can be addressed immediately, there are a variety of measures available to remedy to situation. Reversals can be requested, or immediate re-application. Additionally, if the denial was improper and no immediate remedies can be identified, an appeal can filed, initiating the appeal process. The Medicaid will set up a fair hearing, and an Administrative Judge will assigned to decide on the matter.
All of these issues can usually be addressed through proper preplanning, estate planning, Medicaid planning, working with an elder law attorney to receive legal advice, etc. Or working with QMC. Our professionals have handled these issues thousands of times and can help your family too. And, if necessary, QMC can refer the family to an experienced elder law attorney to address any legal matters.