Caution #: You Cannot Change Your Mind Later On The Type Of Application
You cannot change your mind going forward so be sure to consider not only this years income, but your expectations going forward. For example, one or both spouses may not yet be receiving Canada Pension Plan or Old Age Security, or may be entitled to receive income from a work pension or a RRSP in the future. In particular, if no money is being taken from an RRSP, remember that withdrawals must start after age 71. This income could have a significant impact on the calculation under the individual or the joint method, and should be considered at time of the first application. Unfortunately, there will be no clear answers in many cases because life expectancy is usually the unknown factor. If a persons income will increase at some date in the future, but he or she does not live that long, such income will be irrelevant. Still, you need to plan ahead.
Who May Receive Nursing Facility Services
NF services for are required to be provided by state Medicaid programs for individuals age 21 or older who need them. States may not limit access to the service, or make it subject to waiting lists, as they may for home and community based services. Therefore, in some cases NF services may be more immediately available than other long-term care options. NF residents and their families should investigate other long-term care options in order to transition back to the community as quickly as possible.
Need for nursing facility services is defined by states, all of whom have established NF level of care criteria. State level of care requirements must provide access to individuals who meet the coverage criteria defined in federal law and regulation. Individuals with serious mental illness or intellectual disability must also be evaluated by the state’s Preadmission Screening and Resident Review program to determine if NF admission is needed and appropriate.
Nursing facility services for individuals under age 21 is a separate Medicaid service, optional for states to provide. However, all states provide the service, and in practice there is no distinction between the services.
In some states individuals applying for NF residence may be eligible for Medicaid under higher eligibility limits used for residents of an institution. See your state Medicaid agency for more information.
Using Annuities To Pay For Long
You may choose to enter into an annuity contract with an insurance company to help pay for long-term care services. In exchange for a single payment or a series of payments, the insurance company will send you an annuity, which is a series of regular payments over a specified period of time. There are two types of annuities: immediate annuities and deferred long-term care annuities.
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What Nursing Home Benefits Are Available From The Va
The Department of Veterans Affairs provides long-term nursing home care through different types of facilities. There are the VAs own nursing homes, and there are private nursing homes that contract with the VA to care for veterans when no nearby VA facility is available. There are also the VAs Community Living Centers, which provide short-term residential care along with ongoing outpatient care. And the VA pays a small part of the cost of residence in State Veterans Homes for some veterans who are not eligible for direct VA nursing home care.
Eligible veterans may qualify for residence in a VA nursing home if they have physical and/or mental impairment serious enough to require nursing home care. If there is no VA nursing home close to the veterans home and family, or there are no available spaces in a nearby VA nursing home, the VA may pay for a veteran to reside in a nearby private nursing home if that facility has a contract with the VA to provide care to veterans.
Community Living Centers are another type of VA long-term care facility. They provide a combination of short-term residential care options similar to assisted living and ongoing community care to veterans with chronic, but stable conditions, including:
- Dementia or Alzheimers disease
- Conditions requiring rehabilitation or short-term special services such as respite or intravenous therapy
- Conditions requiring hospice or other palliative care at the end of life
What If A Person Does Not Require Nursing Home Care But Cannot Afford The Costs Of Living In A Seniors Residence
In such a case, the Long-term Care Subsidization Act does not apply, and the rules discussed here are irrelevant. A person living in a seniors apartment or a community care facility is similar to anyone living in a home or apartment they cannot afford. They will need to look for more affordable housing or seek financial help from family, friends or social assistance . These rules differ from long-term care subsidies, and your assets may need to be sold before you qualify. Former Social Assistance Policy 4-3 stated, Real and personal property owned by the applicant is generally to be regarded as a financial resource which the applicant, through outright sale or by using as collateral for short term credit, may draw upon to support his/her needs. See Policy SA 4.2 issued April 1, 2022 or a discussion of the maximum liquid assets you are allowed to have to qualify for long-term financial assistance under the Social Assistance Act. Note that your principal residence , a vehicle, up to $5,000 for a prepaid funeral and various other exemptions of assets that need not be sold are listed in the above noted Policy.
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Caution #: Remember The Impact On The Spouse Remaining At Home
There is another aspect to be considered before automatically using an individual application because that spouse has a lower income. Where a home is maintained by a couple, the spouse remaining at home is entitled to retain a minimum income of $22,133 . This minimum guarantee will only be available when subsidy applications are made as a couple.
For example, assume Person A has an income of $10,000 and Person B, the spouse, has an income of $15,000. If Person A enters a long-term care facility and applies individually, the income of $10,000 would result in a subsidy of $23,649 per year . This is calculated as the full cost of $33,649 minus income of $10,000. Of course, Person B will only have $15,000 available to support themselves at home.
The alternative is to apply based on the combined income. 50% of the combined income would be $12,500. At first glance, you may think the subsidy would be lower, because $33,649 minus $12,500 would be $21,149 instead of $23,649 as determined above. However, Person A staying at home is guaranteed at least $22,133 of retained income for a couples application, a second calculation would be done to increase the subsidy to $30,782. [Here are the detailed calculations: /2=$12,500 average income for the couple $22,133 minimum stay-at-home guarantee minus average income of $12,500 results in an extra $9,633 allowed to Person B and when added to the initial calculation of $21,149 equals 30,782. Again, early planning is required.
Eligibility And Asset Transfer Rules
In the past, to avoid exceeding Medicaid’s income limits, some families would transfer a patient’s assets into the names of other relatives, such as the children. The Deficit Reduction Act of 2005 made such maneuvers much harder to manage. Now, when you apply for Medicaid, there is a five-year lookback at all asset transfers. If Medicaid finds money was transferred within the past five years, a penalty period is imposed, delaying the onset of Medicaid coverage.
Medicaid calculates the penalty by dividing the amount transferred by what Medicaid determines is the average price of nursing home care in your state.
For example, suppose Medicaid determines your state’s average nursing home costs $6,000 per month, and you had transferred assets worth $120,000. You will not be eligible for Medicaid assistance until you pay the cost of the nursing home for 20 months . There is no limit to the number of months for which someone can be declared ineligible. The penalty period begins on the day the patient enters a nursing home.
Not all transfers are counted in the lookback period. Arrangements that are allowed include transfers to:
Medicaid programs are paid for out of both federal and state funds.
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How Do I Apply For Va Long
An application for VA long-term care is separate from the application to enroll in VA medical care coverage. To apply for nursing home or other long-term care, a veteran or veterans caregiver must fill out a special application for extended care services.
Veterans receiving compensation or VA medical treatment for a service-connected disability need not file this separate application.
A Final Comment Regarding Income Taxes
The costs of nursing home accommodations are fully deductible as medical expenses. For an infirm or disabled person living in a community care facility, the portion of the room and board costs related to wages are considered attendant care, which qualify as medical expenses. See my articles for Taxes and Caring for Parents What costs are deductible? and Medical Expenses and Taxes What can you claim?
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Types Of Services In Your Community
Many communities have services just for seniors and other people who may need support to continue living independently at home. You may have to pay a fee for some of these programs or you may find there is funding available. Some of these services are offered only in larger communities. You can find:
- adult day programs including social, fitness and other healthy activities
- transportation services for people who dont have public transportation or need help to use it
- community hospice services including counselling, support groups, yoga and art classes, grief support
- residential hospices where end-of-life care is provided in a home-like environment for those who can no longer stay in their own homes. People in residential hospices receive a wide range of palliative services to keep them comfortable.
Transfer Of Assets To Qualify For Medical Assistance
Transfers of assets may affect your eligibility. An asset transfer occurs when a client or their spouse buys, sells, gives away, or changes the way assets are held. Assets include home and other property, bank accounts, certificates of deposit, cash, etc. If you or your spouse have transferred assets for less than their worth, you may be subject to a penalty period for nursing home services or the ADvantage waiver program. If otherwise eligible, you remain entitled to other covered medical services. Transfers that may affect your eligibility are those made 36 months prior to the date you apply for nursing home assistance or the Advantage waiver program or those made within 36 months of your entry into a nursing home.
If the DHS decides that you are subject to a penalty period, the penalty begins with the month of the transfer and equals the number of months of the uncompensated value of the transferred assets divided by $2,000. However, if a transfer is made during a penalty period and the DHS decides that you are subject to an additional penalty period, the penalty begins with the month following the month the previous penalty period ends. If you request or receive SoonerCare, the DHS will inform you of the penalty period.
How Your Assets Impact Eligibility
Besides income, your assets will be counted toward meeting eligibility requirements. Countable assets include checking and savings account balances, CDs, stocks, and bonds.
In most states, you can retain up to $2,000 as an individual and $3,000 for a married couple outside of your countable assets. However, these amounts may vary depending on the state in which you live.
Your home, your car, personal belongings, or your savings for funeral expenses remain outside of countable assets. If you can prove other assets are not accessible , they too are exempt. A house must be a principal residence and does not count as long as the nursing home resident or their spouse lives there or intends to return there.
Upon becoming eligible for Medicaid, all of the applicant’s income must be used to pay for the nursing home where the applicant resides. However, you may be allowed to keep a monthly “allowance” and a deduction for medical needs, such as private health insurance. The amount of the allowance varies depending on your living arrangements, type of nursing facility, and state rules. If you are married, an allowance may be made for the spouse still living in the home.
Nursing Home Diversion Programs
Most states have non-Medicaid funded programs that provide care services and supports to individuals who require nursing home level care but are not eligible for Medicaid. As with Medicaid waivers, these programs provide services to beneficiaries in their homes or communities with the specific goal of preventing nursing home placement, as the cost to support an individual full-time in a nursing home greatly exceeds that to provide assistance at home. Recognizing that much of the burden of caregiving is shifted to family members, nursing home diversion programs often offer support services to the family caregivers, as well as services to the individual in need of care. Support like respite care to relieve the family caregiver, transportation assistance, and home delivered meals serve the objective of unburdening family members.
Nursing home diversion programs is a loose categorization. These programs typically do not refer to themselves using that name. Rather, each program in each state has its own name. Some states offer more than one program targeting different groups of seniors and other states offer no programs. The types of services available are centered around helping an individual remain living at home. Therefore home care, respite care, transportation assistance and chore services are usually included, but the complete list of services is broader and specific to each program. A state by state list of programs is available here.
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Government Assistance For Caregivers
As a caregiver, you may be eligible for various forms of assistance from the Government of Canada. The attached link offers information to help.
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Life Insurance Policies For Long
Some life insurance policies can help pay for long-term care. Some policies offer a combination product of both life insurance and long-term care insurance.
Policies with an “accelerated death benefit” provide tax-free cash advances while you are still alive. The advance is subtracted from the amount your beneficiaries will receive when you die.
You can get an accelerated death benefit if you live permanently in a nursing home, need long-term care for an extended time, are terminally ill, or have a life-threatening diagnosis such as AIDS. Check your life insurance policy to see exactly what it covers.
You may be able to raise cash by selling your life insurance policy for its current value. This option, known as a “life settlement,” is usually available only to people age 70 and older. The proceeds are taxable and can be used for any reason, including paying for long-term care.
A similar arrangement, called a “viatical settlement,” allows a terminally ill person to sell his or her life insurance policy to an insurance company for a percentage of the death benefit on the policy. This option is typically used by people who are expected to live 2 years or less. A viatical settlement provides immediate cash, but it can be hard to get.
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Statement If You Involuntarily Do Not Live With Your Partner
If you and your spouse or common-law partner do not live together for reasons beyond your control, you’ll need to complete this Involuntary Separation Statement to maximize your pension benefits.
- you must be over 65
- your spouse or common-law partner must be:
- over 65
- living in your community or in a long-term care home, including if they live in the same semi-private room as you
- eligible for the Old Age Security pension and/or Guaranteed Income Supplement
Will Someone Check In On Me While I Receive Home Care
A Care Coordinator will check in with you and your caregivers/service providers on an ongoing basis. If your needs change, your services will change to reflect your Home Care needs. Care Coordinators can also connect you with programs in your community that offer additional supports. Some examples are meal programs, Adult Day programs and foot care clinics.
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Where Nursing Facility Services Are Provided
Medicaid coverage of Nursing Facility Services is available only for services provided in a nursing home licensed and certified by the state survey agency as a Medicaid Nursing Facility . See NF survey and certification requirements. Medicaid NF services are available only when other payment options are unavailable and the individual is eligible for the Medicaid program.
In many cases it is not necessary to transfer to another nursing home when payment source changes to Medicaid NF. Many nursing homes are also certified as a Medicare skilled nursing facility , and most accept long-term care insurance and private payment. For example, commonly an individual will enter a Medicare SNF following a hospitalization that qualifies him or her for a limited period of SNF services. If nursing home services are still required after the period of SNF coverage, the individual may pay privately, and use any long-term care insurance they may have. If the individual exhausts assets and is eligible for Medicaid, and the nursing home is also a Medicaid certified nursing facility, the individual may continue to reside in the nursing home under the Medicaid NF benefit. If the nursing home is not Medicaid certified, he or she would have to transfer to a NF to be covered by the Medicaid NF benefit.