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The three primary versions of Medicaid Long Term Care (LTC)

This week in Crisis Corner: The three primary versions of Medicaid Long Term Care (LTC).

There are many flavors of Medicaid benefits available to Washington residents, especially once you get into all of the medical only benefits. When it comes to LTC benefits for a person who is “aging, blind, or disabled” there are at least five or six programs, but in most cases clients are looking at one of three. Those three are: 1) Classic Medicaid; 2) Community Options Program Entry System (COPES); and 3) Community First Choice (CFC). They share many similarities but each is also unique both in its rules and its benefits. Much of the confusion that I have to help my clients sort through is created when they do their research before coming to me, but they research the wrong program for their needs.

Similarities across the board. About the only thing that is the same across the board for these three programs is the resource limit for a single person. In all three, a single person can own a home with up to $603,000.00 in equity, a car of any value, and up to $2,000.00 in other countable resources. For all three, a “well spouse” can have a house of any value and a car of any value (not separate from the ones owned by the applicant), and an unlimited income. The rest varies from program to program.

Classic Medicaid.

Classic Medicaid is what most people think of when they talk about Medicaid. It is the Federal program that is, relatively, universal across the states. This program is only available in a Skilled Nursing Facility (SNF) and nowhere else. When a married person applies for Classic Medicaid, their spouse can have up to $130,380.00 worth of “other countable resources.” This is not a fixed amount and has to be calculated on a case by case basis. The formula is that you add up the total value of resources (other than the house and car) that the couple owned on the first day of the month in which the applicant received care at the SNF and divide that number by two. The well spouse can have that amount of resources with a minimum of $58,075.00 and a maximum of $130,380.00.

Some examples:

  • John moves into a SNF on January 5th. On the 1st he and Jane owned their home, one car and $100,000.00 in other countable resources. Jane should get to keep $50,000.00, except the minimum is $58,075, so that is the amount she can keep.
  • John moves into a SNF on January 5th. On the 1st he and Jane owned their home, one car and $300,000.00 in other countable resources. Jane should get to keep $150,000.00, except that exceeds the maximum, so she is limited to $130,380.00.
  • John moves into a SNF on January 5th. On the 1st he and Jane owned their home, one car and $150,000.00 in other countable resources. Jane gets to keep $75,000.00.

The other big difference between Classic Medicaid and the other programs is that there is no functional assessment required. Medicaid assumes that you would not choose to live in a SNF if you did not have to do so because of your care needs.

Once on Classic Medicaid, the applicant can keep a $71.21 personal needs allowance (PNA), enough money to pay for their supplemental insurance premiums, and maybe give some to their spouse (if the spouse’s income is low enough). The rest of their income is paid to the SNF and then Medicaid pays the rest.

If any gifts are made within five years of applying for benefits, benefits may be denied for a period that is determined based upon the size of the gifts. The penalty is approximately equal to a month of penalty for every $10,500.00 given away.

COPES.

COPES is the rough equivalent to Classic Medicaid when the applicant lives anywhere other than a SNF. The Well spouse of a COPES applicant is allowed to have $58,075.00 in other countable resources. COPES does have a functional requirement in addition to the financial requirements. A State social worker will perform an assessment of the applicant’s care needs and assign a value to those needs. If benefits will be received at home, the assessment is used to determine how many hours per month Medicaid will approve (rarely over 180) and in any other setting it is used to determine how many dollars per day the care community will be paid.

Once on COPES, the applicant can keep a $71.21 PNA (outside of the home), $794.00 or $1,064.00 PNA (in the home married or single), enough money to pay for their supplemental insurance premiums, and maybe give some to their spouse (if the spouse’s income is low enough). The rest of their income is paid to the care provider and then Medicaid pays the remainder of the approved care cost.

If any gifts are made within five years of applying for benefits, benefits may be denied for a period that is determined based upon the size of the gifts. The penalty is approximately equal to a month of penalty for every $10,500.00 given away.

CFC.

The requirements for CFC are nearly identical to COPES, as are the benefits. It is easier to point out the differences in this program than it is to start from the beginning.

CFC is only available to those who are outside of the home but not in a SNF and whose gross income is less than $2,382.00 per month, or those who are in the home with gross income below $794.00 per month.

CFC only allows for the PNA and not for supplemental insurance premiums, which could mean that the applicant will need to change to a free supplemental insurance or their loved ones may need to cover the cost of the insurance premiums.

CFC benefits are not delayed by gifts made within five years of applying. However, the penalty period is still calculated and the applicant is not eligible to transition to COPES or Classic Medicaid during that period. The penalty period for all three programs is limitless. This means that a person who qualifies for CFC benefits but gives away $700,000.00 (just a random example) will not be able to move to a SNF with Medicaid coverage for over five and half years. This makes it important to ensure that the care community where they are living is one that will be able to handle their care needs for a long time.

Summary. It is not important for you to decide which program is right for you, which is the job of elder law attorneys like myself. However, understanding the differences between the programs can help you understand the advice you are given or even dissolve some misconceptions that have kept you from reaching out for help in the first place.