Presenting a live 90 ‐ minute webinar with interactive Q&A Medicaid Estate Recovery Minimizing State Recovery of Long ‐ Term Care and Medical Assistance Payments TUESDAY, NOVEMBER 29, 2011 1pm Eastern | 12pm Central | 11am Mountain | 10am Pacific T d Today’s faculty features: ’ f l f Philip A. Di Giorgio, Esq., Pierro Law Group L.L.C. , Albany, N.Y . Louis W. Pierro, Esq., Pierro Law Group L.L.C. , Albany, N.Y . The audio portion of the conference may be accessed via the telephone or by using your computer's speakers. Please refer to the instructions emailed to registrants for additional information. If you have any questions, please contact Customer Service at 1-800-926-7926 ext. 10 .
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November 29, 2011 Medicaid Estate Recovery Medicaid Estate Recovery Medicaid Estate Recovery Medicaid Estate Recovery By: Philip A Di Giorgio Esq & By: Philip A. Di Giorgio, Esq. & Louis W. Pierro, Esq. 43 British American Blvd., Albany, NY 12110 100 Park Ave., 20 th Floor, New York, NY 10017 Toll Free: 866-951-PLAN
Long-Term Care Crisis • 78 million Baby Boomers begin turning 65 in • 78 million Baby Boomers begin turning 65 in 2010 • Two in Five reaching age 65 will need some • Two in Five reaching age 65 will need some type of Long-Term Care in their lifetime • By 2020, 12 million older Americans will • By 2020 12 million older Americans will need Long-Term Care • People are living longer (people living past • People are living longer (people living past age 85 have increased 80%) • Increase in dementia and Alzheimer’s • Increase in dementia and Alzheimer s Disease 6
Long-Term Care Costs New York New York • Institutional Costs - $90,000 – 180,000 • Home Care Costs - $0 – 200,000 (Informal Care vs. 24-hour Formal Care) 7
Medicaid • Medicaid is the only government program that pays for LTC Medicaid is the only government program that pays for LTC • Medicaid is viewed as the “payor of last resort” for medical care, nursing homes and in some states home health care • Two-thirds of Medicaid funds are for persons over 55yrs old T thi d f M di id f d f 55 ld • Under current law, spending on Medicaid is expected to substantially outpace the rate of growth in the U.S. economy over the next decade (grow at an annual average rate of 7.9% over the next 10 years, reaching $674 billion by 2017) • States report they are struggling to meet their share of States report they are struggling to meet their share of expanding Medicaid costs (35-50%) • Medicaid is under attack by federal, state and local governments governments 8
Medicaid Recovery History • Twelve states report having had an estate • Twelve states report having had an estate recovery program in effect before 1990 that was based on the original 1965 Medicaid law was based on the original 1965 Medicaid law • 1982 Tax Equity and Fiscal Responsibility A t (TEFRA) Act (TEFRA) – First federal estate recovery law – Not mandatory – Some states refused to implement 9
OBRA 93 • Mandatory Recovery concept based off results in • Mandatory Recovery concept based off results in Oregon in 1940s – estate recovery was implemented as part of a estate recovery was implemented as part of a comprehensive program to help senior citizens keep enough money to meet their own needs and protect their assets from unscrupulous uses by others assets from unscrupulous uses by others • OBRA 93 Required states to implement a Medicaid estate recovery program estate recovery program • States who failed to implement an estate recovery program were to lose federal funds (Upheld in West program were to lose federal funds (Upheld in West Virginia v. United States) 10
Medicaid Recovery • All States now have a Medicaid Recovery Program All States now have a Medicaid Recovery Program • At a minimum, states must recover from assets that pass through probate (which is governed by state p g p ( g y law). • At a maximum, states may recover any assets in which the deceased recipient had an interest in at hi h th d d i i t h d i t t i t time of death. • One-third of recipients of Medicaid qualify for estate One third of recipients of Medicaid qualify for estate recovery • Much-vaunted savings have not become a reality g y 11
Estates Subject to Recovery • Deceased recipients who were 55 or older • Deceased recipients who were 55 or older when they received Medicaid benefits or who regardless of age were permanently who, regardless of age, were permanently institutionalized. • May impose liens on property of Medicaid M i li t f M di id recipients of any age if they are permanent residents of a nursing home or other medical id t f i h th di l institution, and if they are expected to pay a share of the cost of institutional care. h f th t f i tit ti l 12
Definition of Estate • 42 USC 1396p(b) • 42 USC 1396p(b) • Mandates that the term “estate” contains all real and personal property and all other l d l t d ll th assets included in the individual’s estate under state probate law. d t t b t l • The order of payment of debt is established under state law. – ability to recover from probate estates depends on Medicaid’s standing vis-à-vis other claimants 13
Expanded Definition of Estate • Some States have chosen to define “estate” • Some States have chosen to define estate in a broader context, which enables them to recover from some or all property that recover from some or all property that bypasses probate. – Such property includes assets that pass directly S ch propert incl des assets that pass directl to a survivor, heir or assignee through joint tenancy rights of survivorship life estates living tenancy, rights of survivorship, life estates, living trusts, or annuity remainder payments. 14
How Much is Subject to Recovery • At a minimum, states must recover amounts spent At a minimum, states must recover amounts spent by Medicaid for long-term care and related drug and hospital benefits, including Medicaid payments for Medicare cost sharing related to these services for Medicare cost sharing related to these services. • Option of recovering the costs of all Medicaid services paid on the recipient’s behalf. • The majority of states recover spending for more than the minimum of long-term care and related expenses. p • May not exceed the amount remaining in the estate after the claims of other creditors having a higher priority against the estate have been satisfied priority against the estate have been satisfied. 15
Interest • Some states authorize interest on Medicaid • Some states authorize interest on Medicaid Estate Recovery claims accrual of which will begin a certain period of time after death begin a certain period of time after death depending on the state – E.g. Oregon 9%, six months after date of death E g Oregon 9% si months after date of death • Interest may also accrue on spousal support obligations from date of Medicaid services bli ti f d t f M di id i 16
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