15 OHIP/INF-1 - Questions and Answers: Long Term Care Eligibility for MAGI Individuals

The purpose of this informational letter is to provide answers to questions asked by local departments of social services regarding the policy described in General Information System Message (GIS) 14 MA/16, "Long Term Care Eligibility Rules and Estate Recovery Provisions for MAGI Individuals." Although individuals whose eligibility is determined under Modified Adjusted Gross Income (MAGI) rules are not subject to a resource test, several other statutory provisions apply when the individual seeks Medicaid payment for long-term care services. Pursuant to guidance provided by the Centers for Medicare and Medicaid Services (CMS), the GIS provided clarification on:

• Transfer of assets;
• Substantial home equity limit;
• Post-eligibility rules;
• Liens on real property; and
• Estate recoveries.

A list of questions asked by social services districts and answers follows

Application/Renewal for Coverage of Nursing Home Care

1. Q. When we receive notification of a recipient's admission to a nursing home, we request completion of Supplement A (DOH-4495A) by the consumer/facility in order to process coverage for nursing home care. Is the date of the request or the date on which the Supplement A is received considered the date of application?

A. The date a request for an increase in coverage is received is considered the application date. A request can be in the form of Supplement A, a telephone request, receipt of nursing home authorization on the LDSS-3559 form (Residential Health Care Facility Report of Medicaid Recipient Admission/Discharge/Readmission/Change in Status), contact from DOH regarding a transfer from New York State of Health (NYSOH) or some other form of written request.

2. Q. GIS message 14 MA/16, 'Long Term Care Eligibility Rules and Estate Recovery Provisions for MAGI Individuals," advised that MAGI individuals do not have a resource test but they are subject to transfer of assets rules. If eligibility for an institutionalized MAGI individual was determined prior to release of the GIS, must a district re-determine eligibility and review assets for the 60-month look-back period?

A. Although the effective date of GIS 14 MA/16 was January 1, 2014, to align with the implementation date of the Affordable Care Act, MAGI individuals who were determined eligible for coverage of nursing home care prior to the release of GIS 14 MA/16, are not subject to a 60-month look-back period. Such individuals will also not be subject to a 60-month look-back period if they remain institutionalized, remain eligible for Medicaid, and subsequently change to the SSI-related category of assistance.

3. Q. Are there different eligibility requirements for submitting documentation of resources for MAGI individuals renewing coverage for nursing home care?

A. Since no previous resource information is available for MAGI individuals who were authorized coverage of nursing home care prior to August 5, 2014, the release date of GIS 14 MA/16, resource documentation for the past 12 months but not prior to August 5, 2014, is required at renewal. At subsequent renewals, only current resource documentation is required.

4. Q. Is documentation of resources required at renewal for a MAGI individual who provided documentation of resources for the 60-month look-back period pursuant to the guidance provided in GIS 14 MA/16?

A. At each renewal MAGI individuals must provide documentation of current resources. This is to determine if resources may have been transferred since coverage of nursing home care was authorized or since the last renewal.

Transfer Rules

5. Q. Will there be any change in how the transfer provisions are applied when an institutionalized MAGI individual documents that assets were transferred for a purpose other than to qualify for Medicaid coverage of nursing facility services?

A. No. If a MAGI individual provides documentation that supports a claim that assets were transferred for a purpose other than to qualify for Medicaid, a transfer penalty is not imposed.

6. Q. If property is transferred in the 60-month look-back period to an ineligible relative, is a transfer penalty imposed?

A. When property is transferred to an individual, other than an individual described in the exceptions to the transfer rules, a transfer penalty may be imposed. The penalty period begins the month the individual is institutionalized and otherwise eligible for coverage of nursing home care.

7. Q. Since we do not count the community spouse's income when the institutionalized spouse is eligible under MAGI, do we do a look-back on resources that are in the community spouse's name only?

A. Yes. Any uncompensated transfer made by the MAGI individual and/or the individual's spouse may result in a period of ineligibility for Medicaid payment of nursing facility services for the institutionalized MAGI individual.

8. Q. If a person is considered "medically frail", if and when do they become an institutionalized individual and become subject to resource and transfer rules?

A. No resource test is applied to a MAGI individual. If the MAGI individual is an applicant or in receipt of Medicaid fee-for-service coverage and an admission to a nursing home is for up to 29 days of short term rehabilitation services, no 60-month look-back is applied until the 30th day of residence or when the status changes to permanent placement, whichever occurs first. If the individual is enrolled in Medicaid managed care there is no 60-month look-back until permanent placement. For MAGI individuals who may be enrolled in managed long term care, the look-back period applies effective on the 30th day of a placement for short term rehabilitation or upon permanent placement, whichever occurs first.

9. Q. How do we impose a transfer penalty if we cannot bring the MAGI individual up to the resource level? How do we determine whether the MAGI individual is otherwise eligible?

A. A MAGI individual is otherwise eligible if income is less than or equal to 138% of the Federal Poverty Level (FPL). Since there is no resource test for MAGI individuals, there is no offset to a transfer penalty.

Spousal Impoverishment Rules

10. Q. Since spousal rules (both income and resource) apply to married individuals who are expected to remain in or are admitted to a medical facility for 30 days or more, do the same rules apply to married MAGI individuals?

A. Spousal impoverishment rules do not apply to married individuals who are eligible under the MAGI category.

Home Equity Limit

11. Q. Is property owned by a MAGI individual a countable resource?

A. MAGI individuals are not subject to a resource test, so the value of any real property is not counted when determining eligibility. However, there is a substantial home equity limit for Medicaid coverage of community-based long-term care and nursing home care. This home equity limit does apply to individuals who are otherwise eligible under the MAGI category. The current home equity limit is $828,000. Individuals are not eligible for Medicaid coverage of long-term care services if their home equity exceeds this limit.

Recovery

12. Q. How is estate recovery for an individual who is eligible under MAGI rules different from estate recovery for individuals who are eligible under another category?

A. For non-MAGI individuals, a claim may be made against the estate of a deceased individual to recover the cost of Medicaid provided on or after the individual's 55th birthday. For MAGI individuals, estate recovery is limited to Medicaid costs paid for nursing home care, home and community-based services, and related hospital and prescription drug services received on or after the MAGI individual's 55th birthday.

Systems

13. Q. Since the Resource Verification Indicator (RVI) of 9 (no resource test) does not allow data entry in the Principal Provider (PP) subsystem for more than 29 days of nursing home care, if a MAGI individual is institutionalized on a temporary basis for more than 29 days, do we change the RVI code to 1 even though we have not done a 60-month review of resources?

A. RVI 9 is to be used. For RVI 9, there is no systemic edit on the number of days of nursing home coverage that can be authorized in PP subsystem.

14. Q. If a MAGI individual who is enrolled in Medicaid managed care (MMC), goes into a nursing home, do we disenroll the individual from MMC?

A. No. Since the nursing home benefit has transitioned into MMC, an individual will not be disenrolled when the status is considered permanent.

15. Q. If we do a 60-month look-back on a MAGI individual who is enrolled in MMC, do we put in the RVI 1 or keep it a 9?

A. Since the system will only allow RVI 9 for a MAGI individual, districts must continue to use RVI 9 in this situation.

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16. Q. Will Principal Provider entries be made the same way for MAGI individuals covered under Medicaid fee-for-service

A. Yes. There are no changes to the entries required to be made in Principal Provider when authorizing Medicaid payment for nursing home care for fee-for-service recipients. MAGI individuals will have a NAMI of $0 since income cannot exceed 138% of the FPL, unless there is a partial month penalty due to a prohibited transfer of assets.

17. Q. If an institutionalized individual is enrolled in a MMC or managed long term care (MLTC) plan, does the district still enter the Net Available Monthly Income (NAMI) in the Principal Provider subsystem?

A. No. Medicaid will make a managed care payment to the plan. An entry into Principal Provider is not required since the nursing home will not be submitting a claim to Medicaid. The plan is responsible for collecting the NAMI (or may delegate the responsibility to the nursing home). The NAMI will appear on the plan roster. The plan will also receive a copy of any notice that establishes or changes a NAMI.

Disability Review

18. Q. If an institutionalized MAGI individual's income exceeds 138% of the FPL, can he/she spend down (i.e. have a NAMI) or must the individual be determined SSI-related in order to qualify for nursing home coverage?

A. If the institutionalized individual is not eligible under the MAGI category (i.e., income exceeds 138% of the FPL), he/she must be found eligible under another category. If the admission is temporary, the individual may qualify under the ADC-related category (if the individual is a parent of a child under age 18, or under age 19 if in school), unless spousal impoverishment rules apply. If the admission is permanent, the individual must be SSI-related and spousal impoverishment rules may apply if there is a "community spouse".

19. Q. Is it correct that a disability review is not required for a MAGI individual who is "medically frail" and who requires short term nursing facility services? What if the individual requires more than 29 days of short term rehabilitation, but the DOH-3559 indicates that the admission is temporary? We usually allow two temporary stay requests for up to six months. If the individual remains in the nursing home beyond the six months, we change the status to permanently absent. At this point, is a disability review required?

A. A MAGI eligible individual can qualify for both short-term and long-term nursing home care without a disability determination. In the case of long-term nursing home care, the individual is automatically considered to be "medically frail" and a disability determination is not required in order to be eligible for Medicaid payment of nursing home care. If a short-term rehabilitation stay exceeds 29 days, the individual can remain in the MAGI category; however, a review of assets for the 60-month transfer of assets look-back period is required in order to determine if the individual is eligible for Medicaid payment of nursing home care. If the MAGI individual is enrolled in Medicaid managed care, the 60-month look-back period applies when the placement is considered to be permanent. It should be noted that while the district can require periodic documentation from a nursing home that a placement continues to be temporary, there is no set six month limit for temporary nursing home placement.

20. Q. According to 10 OHIP/ADM-1 (pages 8 & 9), no coverage for permanent nursing home care is approved until an unmarried Single Individual/Childless Couple or ADC-related individual is determined certified disabled. Has the provision for a disability determination been removed for a MAGI/Medically Frail individual?

A. Permanently institutionalized MAGI individuals can categorically qualify for coverage of long-term nursing home care without a disability determination.

21. Q. A single individual is applying for coverage of long term nursing home care. He appears to meet the criteria to be eligible under MAGI rules and medically frail (adult under 65 yrs. old, no Medicare, has a LDSS-3559 showing permanent admission to the nursing home). We do a MAGI budget and his unearned income puts him over the 138% FPL. What is the correct action for the examiner to take? Does the examiner deny the application for excess income and then proceed with a disability determination? Would we require this individual to contribute the amount of his excess income toward the cost of the nursing home care?

A. In this scenario, since the individual's income is above 138% of the FPL, the individual is not eligible under the MAGI category of assistance. Since the individual is not MAGI, and the admission is permanent, a disability determination must be completed prior to taking any action on the application (the district has 90 days to make a determination of eligibility when a disability determination is required). The individual must be found eligible under the SSI-related category of assistance in order to receive coverage of long term nursing home care. Chronic care budgeting is used to determine any contribution toward the cost of care.

22. Q. If a MAGI individual is a permanent placement in a nursing home, do we do a disability referral or refer the individual to apply for Social Security Disability (SSD)?

A. An individual who is eligible under the MAGI category of assistance is not required to be certified as disabled in order to be eligible for Medicaid coverage of long-term nursing facility services. Since a MAGI individual is required to pursue all available income, a permanently institutionalized MAGI individual is required to apply for SSD.

Change in Category

23. Q. When an individual is MAGI and enters a nursing home, the individual can retain his/her eligibility under the MAGI category, despite the nursing home stay, for some period of time. At the point that the individual loses eligibility under the MAGI category (due to receipt of Medicare, or any other valid reason), what are the requirements regarding the transfer of assets look-back period? Is a full 60-month review necessary, and what are the transfer implications?

A. An individual who is eligible under the MAGI category is subject to the transfer rules when short-term rehabilitation services exceed 29 days or when the stay is permanent. This can occur prior to the individual losing eligibility under the MAGI category. If it does, and the individual subsequently loses eligibility under the MAGI category, another review of resources for the 60-month look-back period is not conducted. A review of current resources would be required under the new category as the individual would have a resource test.

24. Q. Once an individual is no longer eligible under MAGI rules (i.e., turns 65 or begins to receive Medicare), do we conduct another review of the look-back in order to determine eligibility for nursing home coverage under the new category? The individual will not be MAGI if the stay goes permanent, correct?

A. An individual can remain in the MAGI category if a nursing home stay goes permanent. If the individual becomes categorically SSI-related at age 65 or based on the receipt of Medicare, no new 60-month look-back is required.

25. Q. When an institutionalized recipient changes from MAGI to SSI-related and needs a chronic care budget, do we need to do another five-year look back?

A. No. The district would determine current resource eligibility.