How does the process work when paying for a nursing home?

Joyce - I'm assuming that everybody is on the same page that FIL needs a NH and can't live at home; he owns his home and has "income" over your state's limit for Medicaid and he is a widow (no community spouse issues). My answer is based on that, it's going to be long so get that coffee....

My experience is with Medicaid in TX & LA: moved my mom from IL to NH; mom still has her modest home; I am her DPOA, MPOA and all legal done ages ago. My mom makes just under her state's ceiling for Medicaid income. I will highly suggest that 1 person be the point person for all things NH for FIL and that family is totally in agreement and kum-ba-ya in what is going to be done and by whom.

NH (aka skilled nursing facility/SNF or long term care/LTC) is paid for 3 ways: 1) private pay by either the elder or their family; 2) from LTC insurance; or 3) by qualifying for Medicaid.

Medicaid NH rules set by each state & are state specific even though is a joint federal & state program. Qualification both financial & medical. Medicaid is a needs - based program. You are fully expected to spend down your assets first & foremost before the state will pay. There are things that can be done with assets in advance but imho need to be done by someone qualified who understands your state’s Medicaid. Usually a certified elder law attorney or qualified financial planner. If you are looking at an imminent placement in a NH, you're limited on what you can do now without a Medicaid transfer penalty.

For NH Medicaid eligibility, an individual must show that:
1) are 65+ (can be younger if qualified disability),
2) medical condition requires SKILLED level of nursing care,
3) monthly income at or below their states max (varies, about 2K),
This is the “income test”– how much $ do you make.
4) all countable assets are at or below 2K (higher if community spouse). This is the “asset test” – how much $ do you own.
Assets are savings, IRA, stocks, insurance, real estate, etc.
5) have not gifted away anything of value during 5yr look-back.

If you do, could be a “transfer penalty” for gifting. Penalty based on each state’s NH daily reimbursement rate. For Texas $ 142.92. So Blue Book value car of 10K = 70 days penalty in which you have to private pay NH although they are accepted in Medicaid. Transfer penalty is totally odd because they are accepted into the Medicaid program for NH BUT are ineligible for payment by Medicaid for the NH till the transfer penalty is paid or worked-out.

Financial look-back is up to 5 yrs. Most states require 3 – 6 mo. of all financials, plus property ownership documents with initial application. The NH will likely give you a sheet of paper with a list of documents wanted. For my mom, it was 1 page BUT for my MIL it was 2 pages and both NH were in the same state - so go figure. The documents needed list are pretty specific: bank statements, property owned; income details, all insurance policies, etc. For car or home, that is current tax assessor statement. You sign off for state’s ability to access any & all records. State can require add’l documentation if something pique’s interest, like paperwork to establish if insurance is term or whole life.

My mom's documents ran slightly over 100 pages mainly due to her old-school style life and funeral policies. You want to do the items needed and submit them as a total dump - everything needed all at once. Not piecemeal. You want it so that the caseworker has all he needs to review the application in 1 sitting. My mom's financials were for 3 years and 6 months.

INCOME: Exact income max is set by each state. Most states have “income” at $ 2,022 per mo but it can be more or less. TX is $ 2,094. Income is whatever $ they get monthly – retirement, SS, annuity, etc. If they get something that pays annually – like a dividend – it can be sticky if the amount of the dividend takes them over the income max for that mo. & you likely will have to do a specialized form to have it amoritized evenly by 12. Yeah lots of fun there.

MILLER TRUST: If every month they are over the states income limit BUT not enough to pay NH in full & qualify for NH in every other Medicaid way, then they can see an elder care attorney to do a "Miller Trust" or a "Qualified Income Trust". Mom gets 1K SS & 1,500K from retirement. Income = $2,500. Income is $ 500 over monthly ceiling income. No matter what is always $500 over. Mom cannot do anything to reduce the amount as it is fixed and guaranteed. So the excess $ 500 is what funds the Miller trust & therefore mom’s income is now 2K and within the states income ceiling. Beneficiary of the trust is state's Medicaid program and upon death, trust reverts to the state. Miller really has to be done by an attorney who does elder law as it needs to be flexible / adaptable and meet the criteria of each state's law on probate (death laws) & Medicaid rules & MERP (estate recovery). The key with Miller is that it belongs to the state, family does not get any of this Miller Trust $ no matter how long dad lives or what the final figure is in it.

PNA - For an individual in NH on Medicaid, all their income has to be paid to the NH less whatever your state has as a “personal needs allowance”. PNA varies by state. My mom’s is $60 mo & enough to cover cable, phone or hair salon. Realistically if they have a home or car (exempt assets) there will be no real $ for elder to maintain them (insurance, taxes, etc).

If they have a home, then family needs to have a come to Jesus meeting on whether to keep the house for whatever length of time Dad lives and family has to pay for all. If the house is sold, the $ from the sale will disqualify Dad for Medicaid. All this get's super sticky.

My mom has her home. I & another family member pay for all on the empty, not producing income home. House still in her name and homestead exemption done. Mom does an annual want to return home letter too (done by her attorney initially and I just re-do it each year). MERP in TX allows for exemptions to be done for all normal expenses on the empty home and paid by family. The house is merely maintained - no upgrades or making it look cute - you really don't want to do anything that could lead to an increase in apprisal or assessment on the home. Upon my mom's death, we will be filing with MERP to the penny on the costs of the home and it will be a summary claim against her estate. For us, this works and her home is modest with no mortgage so not a strain financially and mom has great neighbors who look out. TX is a level of claim probate state. How your state does probate & death laws, will make a HUGE butt difference (like claim or lein). For TX MERP is a class 7 claim so all other classes 1 - 6 get paid first. That decreases the ability of MERP to recoup the whole amount but it still can happen.

ASSETS: All assets are counted, unless the assets fall within the short list of "noncountable" assets:
- personal possessions,
- a vehicle (some states have a limit on the value)
- a principal residence, provided it is in the same state in which the individual is applying & the house may be kept with no equity limit if the "community spouse" lives there; otherwise the equity limit is about 500K (750K in some states)
- prepaid funeral (irrevocable, NCV, usually 10K max)
- small term life insurance (usually $1,500 & NCV)
All other assets must “spend down” to states max to qualify.

The financials are what most folks focus on. But remember that they also need to medically qualify for skilled care for Medicaid.

MEDICALLY NEEDED:
Most NH admissions come from a hospital discharge. If an individual covered by MediCARE is discharge from a hospital to a nursing home for continued care (aka "rehabilitation") after an inpatient stay of at least 3 days, Medicare will cover 100% of the first 20 days and MAY pay up to 100 days, subject to a co-payment by the patient of $141.50 per day for days 21 to 100 (for 2011).

Medicare does not pay for the many months/years that some people reside in a NH for long-term custodial care. In general, Medicare is limited to short-term acute care.But this MediCARE paid period of time in the NH is when you need to get the documents together to apply for MedicAID.

ISSUES IF MOVING FROM HOME TO a NH: If they are living at home or in IL, and need to move to a NH, you will need to work with their MD to get the criteria in their medical history to show they need skilled nursing care. Just because they are old, or have dementia or incontinent, or forget stuff, etc. is not enough. They have to have documented need for skilled nursing. My mom went from IL to NH and bypassed going to AL. She was able to do this as she had a critical weight loss (more than 10% in 30 days), critical H & H and some other conditions. Sometimes the MD will need to change their meds – like go from Exelon pill to Exelon patch (more “skill” to apply); or change a med to one that needs to be compounded daily which you can’t do at home. Each state has it’s own criteria for admission under Medicaid. They will be evaluated at the NH and often are denied because they don’t have enough “critical” conditions because there is no history when living@ home (unlike coming from a hospitalization). You will have to work with NH and your parents MD’s to get whatever done to establish the need for NH if they are coming from being at home or IL. There is a whole Medicaid medical appeals process in each state for this and separate from the financial appeals. For those still living at home without a huge disease history, becoming a patient of the MD who is the medical director of the NH is good as they will know how to create & write up the health history chart so that it passes Medicaid medical review.

and last................you need to keep all documents in an organized way from here on out. So whomever is FIL's point person needs to be this from the get go. I have to do an annual recertification for my mom's Medicaid for NH. State sends out an questionnaire and MERP acknowledgement and then requires the current month and last 3 months before that of my mom's banking and again wants documentation that was submitted with her initial application (like the value of her prepaid funeral plan and her life insurance policy). For even more fun, the letter states all must be done within 13 days from date of letter. Since it's the state there is no postmark either, so who know just if it goes into the mail that day. Every year by the time I get it (I live in another state) it is always, always right at the due date.
So you have to be and stay organized to respond to whatever Medicaid throws at you in short order and quick turn-around.
Good luck, stay organized and keep a sense of humor - you'll need it.

Igloo, if your parent has the means to pay for NH for many, many years out of pocket, are they more likely to be admitted? Do they have to meet the same criteria as a Medicaid patient? You are very knowledgable and I just wondered if you know how that works? In other words if you have the money to pay, is it just easier to get into a NH?

I am thinking it will probably be.......

Madge1 - my experience is yes and there is a whole subterranean NH system out there that just skirts the edge of compliance. The sort of situation where YES the skilled nursing facility has Medicaid beds but NO there are never any open beds. They are always full. No matter when you call or do a visit they are always taken, occupied, full, no room at the inn. It is only from within the existing long-paying privately residents that those Medicaid beds ever get filled from a waiting list made up from existing residents. So if you want to have your elder's name on the list, well yes you can but you will already be on page 2. So you don't because you really need to find another facility that has a bed right now available. It's a way of keeping the great unwashed out of the facility and reward the tiny group from within imho and still comply with regulations. There's other stuff too - when I was looking for IL for my mom, I went to see the place where my grandmother had been NH and my aunt was there in IL.....well as Mrs. Smith's relative, they would waive the application fee and the deposit. I highly doubt they did this routinely. It's a way of ensuring self selection and limiting diversity of residents. Where I live, there is a wonderful tiered facility that has a endowment that supports charitable grants to residents who cannot pay. Now you have to know this to apply and benefit from it, so the average person isn't going to know about it or benefit. Existing residents - who by & large are private pay - will get the benefit. Fair? not really but within compliance. Personally I foresee a huge problem when the flood of baby boomers will need skilled nursing and just will not have the ability to pay.

Thanks. I assumed because of the way we do things in this country, the person with money will take first priority. Mom and Dad saved all of their lives, never had any fun, small old house, never paid for anything they could get out of paying. No college for their kids, no weddings paid for, no vacations, stopped visiting the grandkids years ago, never a five dollar bill to charity and at the end of the day mom has almost one million in assets and it is earmarked to go to a nursing home, according to her.

I am glad in one sense that we will not have to worry about her being able to get into a facility (no one can stand her) and sad that we all sacrificed so much for this to happen.

madge1, your parents spending habits are similar to my ILs spending habits. NO visits to grandkids, wouldn't even bother to attend graduations or weddings - always saving money. My MIL used to talk about the things she would do to their home after my FIL passed away. They never replaced a single item, no new drapes, flooring, paint, etc - except appliances that broke down. When the hall bathtub plumbing stopped working, they just didn't use that tub anymore. FIL passed away last June, MIL just started hospice in the nursing home where she lives. He was older than her and I suspect she once assumed she would outlive him by many years. I don't mention it, but I do wonder if she regrets not having spent her money on her home. They lived in that home for the entire 25 years of their retirement and she talked about her dreams for it frequently. She just couldn't bring herself to spend the money. While I am glad that they had the money to cover their nursing home life - they could afford curtains for their room, sodas, snacks, refrigerator, clothing, nail and hair care, and really whatever they needed equipment wise. But still wouldn't she have preferred to enjoy that money more earlier in her life?

Now whatever is left over will be split between the kids according to her will. And the really, really sad thing is that she wants to see her other two sons to say goodbye. They are not coming. Neither has any plans on granting their mom her last wish. Neither has seen her since she was diagnosed with vascular dementia. All those years that they wouldn't spend the money to go visit their kids and grandkids - and even worse- when their kids brought the grandkids to their house for a visit my ILs would make sure their house was totally- and I do mean totally- empty of food and drink. They didn't want to have to pay a dime to feed anyone. One year one of the grandsons went through the house at the end of the visit and collected all the food his parents had bought - he didn't want to leave anything for his selfish grandparents.

And now on one will come to see MIL just like no one came to see FIL when he was dying last year. It is sad that a mother won't be able to say goodbye to her children and just look at them one last time. She asks me each day if anyone is coming to see her.

OncehatedDIL, Wow, this is my parents all over. I moved when my daughters were 3 (twins) and 5. Mom and Dad would drive down twice a year and we would go up in the summer......for a while. Then the grandkids got older, my parents got nastier about the drive (they would not fly) and when my oldest was about 15, they just refused to come anymore. They didn't come for graduations (and my oldest was valedictorian of her class of 500+), no college graduations, no wedding. They just forgot them. And when I went up to visit, I was allowed to stay 2 or 3 days. If I made the mistake of staying longer, mom was really mad at me. They were so stingy, we couldn't eat out except to a buffet, so you could get your money's worth. And mom never did anything "nice" to make you feel welcomed. Dad has since died and Mom complained for 3 years about how much the funeral cost.

She would never get a cell phone plan so she could call. My brother added her to his and she won't use it in case it costs something. She buys books at the Dollar Tree because, well they are a dollar. I have a Kindle. She let me know under no circumstances was I to give her a Kindle, it cost money to buy those books! And she doesn't have the internet or a computer, just doesn't care anything about it. She has her hair done at the cheapest place in town, never does the nails (you could get something from those places!).

My oldest is pregnant and expecting in August. Mom has not called her once to congratulate her, it might cost something. My oldest was on Boylston Street, where she works, when the bombs went off in Boston. It was very disturbing. Mom hasn;t called once to tell her she is glad she is OK, might cost something.

I could go on and on forever but i won't. You just have to be balanced in life. Save for the future but have a little fun too. And for God's sake don't be stingy with those you are suppose to love. Like with your IL's, my kids have forgotten about mom. Now she whines how no one cares about her. But that is subject for another site.......yikes.

Also, OncehatedDIL, since my father's death five years ago, we have had to force mom to keep her house in good repair. The roof went and the house was so faded from lack of paint it was embarrassing. It took her 4 years to call a plumber to fix her only bathroom drain. She has a really cheap lawn man who is elderly. He comes out and cuts the grass but that is all. Her bushes need trimming and the yard needs work. She will not hire a lawn service and my brother is too busy with his own life to do her yard work.

However, she shops almost daily. Buys shoes (cheap ones) or returns stuff she bought the day before. The stores know her by name. And of course she only shops the discount stores.

Have you ever seen that TV show about the cheapest people alive? Now they are real head cases. I think I would have to kill someone like that if I lived with them. Just saying.......

YES! They are sooo alike. My MIL shopped daily at a local super cheap discount store. She would bring home the oddest, cheapest trinkets. She would also buy herself several bags of salty snacks each day, mix them together and eat them all the same evening. That was her main sustenance for years. The odd trinkets were not nice enough to give to a charity. When we emptied out their house we put the trinkets out on the curb. The neighbor kids came on the run to carry the stuff off to their homes. We were afraid their moms would make them bring the junk back.

At least yours did call a plumber eventually. We were so worried about what we have to do to sell their house- it was unlivable and filthy. What no discount cleaning products? The real estate agent told us not to worry there was an investment market for homes that needed complete overhauls. Thank goodness!