Medicare Eligibility in a Skilled Nursing Facility:
(All five criteria must be met.)

• Must be a hospital inpatient for three or more consecutive days, NOT including the day of discharge.
• A physician must indicate skilled care is needed on a daily basis.
• Care in the skilled nursing facility is due to a condition that was treated in the hospital.
• Care must be provided in a Medicare-certified skilled nursing facility.
• Coverage for skilled nursing facility days is available (coverage limits have not yet been reached) under Medicare Part A.

Medicare benefits in a Skilled Nursing Facility:

• First 20 days Medicare pays entire cost.
• Next 80 days patient pays $133.50 per day and Medicare pays the rest.
• After 100 days patient pays the entire cost. . 

Medicare Eligibility for Home Health Care:
(All five criteria must be met.)

• Patient must be homebound, i.e., confined to his/her home.
• Part-time or intermittent skilled nursing services are required.  (24-hour skilled care is not covered.)
• Patient must be under the care of a physician.
• Care is provided by, or under arrangements made by, a participating (Medicare-certified) Home Health Agency.
• Services must be provided under a plan of treatment that is established and periodically reviewed by a physician. 

Medicare benefit for Home Health Care:

• Medicare pays entire cost for eligible Home Care services
• Medicare pays for 80% of eligible Durable Medical Equipment and the patient pays the remaining 20%.

Medicaid Limits - Year 2009

Medicaid is the state and federal health insurance program for persons with very limited financial resources, or in some cases, extremely high medical expenses.

Medicaid Eligibility in a Skilled Nursing Facility in Connecticut:

• Care Limits: 

A Physician must certify that care in a skilled nursing facility is both "medically necessary" and "medically appropriate."

• Financial Limits: 

In Connecticut, over 75% of Medicaid recipients were single when they applied (many were previously married and their spouse died) and became eligible after their assets were depleted to $1,600 and all of their income was used to pay for their care.  Details follow.

Detailed Financial Limits for a Single Person (Nursing Facility):

• Can keep $65 (updated in July) each month in income, (war time veterans can keep $155 per month).  All remaining income (e.g., social security, pension, retirement plans, etc.) must be used to pay for your long-term care.
• Can use income to pay for private medical insurance premiums.
• Can keep the primary residence of any value, if :
  • You are expected to return home after being in the nursing home for a short time; or
  • Your child under 21 lives in the house; or
  • Your adult disabled child lives in the house; or
  • Your brother or sister who partly owns the house and has lived there for at least one year before you went into a nursing facility.
• Can have a Burial Plot.
• Can have Term Life Insurance (No cash value).
• Can have Life Insurance when the Face Value (death benefit) of all policies is less than $1,500.
• Can have certain Funeral Contracts.  (Prepaid irrevocable or non-refundable up to $5,400 with a Connecticut funeral home OR a refundable contract up to $1,800).
• Can have no more than $1,600 in total assets. An asset is anything that can be converted to cash, even if a conversion penalty is imposed.
• Can keep additional amount of assets when a Connecticut Partnership-approved long-term care insurance policy has paid for your care.  The amount you can protect (keep) is equal to the benefits paid by the policy.

Detailed Financial Limits for a  Married Person (Nursing Facility):

• Can have everything a single person is entitled to, but differing income and assets limits apply.
• Can keep the primary residence of any value, when any of the following people live in it:
  • Your spouse;
  • A child under 21;
  • An adult disabled child; or
  • A brother or sister who partly owns the house and has lived there for at least one year before you went into a nursing facility.
• Can keep the greater of $21,912 in assets, or half of the combined assets of husband and wife up to a maximum of $109,560, (both amounts updated in January).
• Can transfer a portion of the applicant's income to supplement the "at home" spouse's income so that it is at least $1,750 (updated in July) but no more than $2,739 (updated in January) per month subject to spousal impoverishment rules.
• Can request a Fair Hearing to designate additional income or income producing assets when needed by the spouse to pay for other expenses, such as, the spouse's prescription drugs.
• The "at home" spouse's income is not used to determine Medicaid eligibly, but a portion may be used to help pay for the applicant's care. 

Medicaid Eligibility for Home & Community-Base Care in Connecticut:

• Must be 65 years of age or older.
• Must meet disability requirements, includes the person would be admitted to a nursing facility in the absence of home care services.
  • A Physician must certify that the home & community-based care is both "medically necessary" and "medically appropriate;" and
  • The cost of this care must be less than care in a facility.
• Must meet same asset requirements shown above for nursing facility care.
• Can keep additional amount of assets when a Connecticut Partnership-approved long-term care insurance policy has paid for your care.  The amount you can protect (keep) is equal to the benefits paid by the policy.
• Monthly income must be $2,022 or less, (300% of Supplemental Security Income which is updated in January).

Eligibility for State-Funded "Connecticut Home Care Program for Elders":

• Must be 65 years of age or older.
• Must meet disability requirements.
  • A Physician must certify that the home & community-based care is both "medically necessary" and "medically appropriate;"
  • While needing assistance with three or more of the following seven "critical needs" - bathing, dressing, transferring, eating, toileting, preparing meals and taking medication.
  • Appropriate, but limited, benefits are also provided when one needs assistance with 1 or 2 "critical needs."
• Asset requirements are less restrictive than Medicaid's requirements.  A Single person is allowed to keep up to $32,868 and a Married person can keep up to $43,824
• Can keep additional amount of assets when a Connecticut Partnership-approved long-term care insurance policy has paid for your care.  The amount you can protect (keep) is equal to the benefits paid by the policy.
• Monthly income requirements are on par with Medicaid nursing facility requirements.  You can keep approximately $1,700 (200% of Federal Poverty Level which is updated in January) each month, which generally is used to pay for living expenses.
• Can transfer a portion of the applicant's income to supplement the "at home" spouse's income so that it is at least $1,750 (updated in July) but no more than $2,739 (updated in January) per month subject to spousal impoverishment rules.

As you know, part of the recently signed health care reform bill includes provisions for Long-Term Care (LTC).  While many of these provisions - under the CLASS ACT - are pending legislation, we can provide certain aspects of the program that have been determined.  To help with client reviews and LTC planning strategy discussions, the following is a high-level summary of the CLASS (Community Living Assistance and Supports) structure:

Eligibility:

18 years and older who meets the actively at work requirements can participate.  CLASS is a voluntary federal program.

Premiums:

While the actual premium has not yet been determined, estimates placed the average between $180-240/month.  Premiums would be level and based on your age at application - however - they are subject to increases as determined by HHS and the financial condition of the program.

Benefits:

A Lifetime cash benefit of $75/day is expected to be the average amount.

Waiting Period:

Before you can access benefits, must pay premiums for 60 months (5 years) vesting period. In addition, need to work at least three of the five year period.

Underwriting:

Guaranteed Issue.  Coverage will be offered through the employer market with employees automatically enrolled.  There is an opt out provision.  (self-employed and those who do not have access through their employer will still be able to enroll in the program)

Note:  Before any of these provisions become statute and are finalized by HHS, there will be a two year period before the legislation goes into effect.  Moreover, it will take another five years for funding the program and before anyone reaches eligibility.  As a result,  it will be at least seven years before CLASS becomes operational.  More importantly, given the structure of CLASS as a voluntary program with guaranteed issue underwriting, there is an inherent risk for adverse selection.

The following are reasons why your clients should still consider creating a plan through private LTC insurance: