Written by Carol Aragon-Montgomery (speaker at AZNHA May 2018 meeting)
Carol is the owner/founder of Montgomery & Associates, Inc. a long-term care planning firm focused on ALTCS planning, Legal Document Preparation, and Medicare Insurance. They are not affiliated/contracted/employed with: AHCCCS / ALTCS / VA / Medicare (CMS) / Federal Government.
7 out of 10 applicants are denied for ALTCS the first time they apply. With non-financial, financial, and medical reasons for denials, there is an obvious need for someone to take those applicants by the hand and help them understand why, work with them on options to prevent a denial, and help them through the process of becoming eligible.
ALTCS medical eligibility
- The eligibility is getting tougher. For example, it used to be that a dementia diagnosis in the chart was sufficient. Now, it must be documented by a neurologist. If you have a consumer with dementia or Alzheimer’s disease, make sure you encourage them to schedule and follow through on their visit to a neurologist. This is worth 20 of the 60 points needed to qualify!
- ALTCS only needs the following records: the most recent history and physical, physician progress notes for a year, documented list of medical conditions and diagnoses, prescription and OTC list, hospital or SNF discharge summaries from the past 6 months, and if residing in assisted living, the most recent monthly or quarterly needs assessment.
- Remember to request records in advance to prevent delays in processing. These can be provided to ALTCS before the actual medical assessment.
- Many of you are home-based care providers and your patients are also receiving care from family members … encourage them to begin journaling the services they are providing (date of service, time started, time ended, what service was performed). This will help show ALTCS how often the care is needed. We also can create a Caregiver Agreement for family members providing care.
- To be approved for the program, the applicant must reside in an ALTCS approvable setting. Approvable settings include home receiving or intending to receive services, or a skilled nursing facility or an assisted living home or assisted living facility with an AHCCCS provider ID number.
- Many consumers are surprised that home care is a covered service.
- The maximum number of hours one can receive is 40 hours per week.
- ALTCS does not retroactively pay for home-based care even if the application was approved retroactively. This is generally the same for ALH/ALFs.
- Family members can become the paid caregiver if an approved ALTCS home care provider hires them and they meet hiring requirements.
- If the applicant moves during the ALTCS application process, ALTCS must know about the move (date of move, name, address, and phone number of the facility).
- ALTCS cannot approve the applicant unless he/she is in an appropriate ALTCS setting.
- If he/she has a hospital stay and must go to a rehab center thereafter, please do not allow the hospital to discharge the applicant to a non-ALTCS approved rehab. If you do, ALTCS can approve the case, BUT ALTCS will not pay any unpaid bills for that rehab.
- If you wish to move the applicant to an assisted living facility/home, please make sure this home already has an AHCCCS provider ID number. If this facility/home does not, ALTCS WILL NOT approve benefits in that facility/home.
Financial eligibility – Key points that can help your consumers.
Assets (resources) include, but are not limited to, financial accounts at any institution, life insurance, annuities, investments, property, and vehicles. Countable assets do not have an “exclusion” reason.
- The asset or “resource” limit for single individuals is $2,000.
- The asset or “resource” limit for married couples is $26,720; however, some married couples can keep more. The maximum a married couple may be eligible to keep is $125,600.
- Married couples need to have their spousal share determined as soon as they are eligible to have it determined. When is that?
- When the first person needs 30+ days of institutionalization (i.e., nursing home care or hospital/nursing home care or a combination of them). OR
- 30+ days of home-based or assisted living care. Note: ALTCS makes the determination on HCBS and assisted living. They must determine if the care prevented institutionalization for it to count.
- This is called a Resource Assessment.
- Life insurance with a $1,500 face value or less is typically excluded. Policies over $1,500 are counted and many have to be surrendered BUT that is NOT the only option.
- Home property in Arizona valued less than $572,000 is typically excluded; however, if the property is in a TRUST OR over that value, it becomes a countable asset.
- Although removing it from the trust will gain excludability, it does not fix their estate planning issues and we can help with that.
- Consumers need to understand that there is Estate Recovery for ALTCS members. It used to be that this applied to folks over 55 only; however, effective May 6, 2018, there is no longer an age-related to this. Estate Recovery applies to ALL applicants. Estate Recovery means the State will go after the estate to recover the costs incurred to care for that member. Some exemptions and waivers to apply:
- Surviving spouse, surviving children under age 21, or surviving child who is blind or disabled
- Heirs who own business in that property*, heirs who reside in the residence and have for the past year and who do not own another residence
- A vehicle is typically excluded; however, it must be in use for the customer’s benefit or for the spouse.
Transfers / gifts
- It’s important to disclose gifts. Many people are fearful of doing this. ALTCS needs to know about these so they can determine if the transfers or gifts are compensated or uncompensated. Compensated transfers DO NOT affect eligibility. Uncompensated transfers can result in periods of ineligibility.
- Transfers do not result in a “denial” of benefits. Instead, if the ALTCS member meets all requirements and has a transfer, ALTCS imposes a penalty period.
- Some transfers may be excluded and some penalty periods can be waived.
- Income limit for single persons is $2,250 per month.
- Income limit for married couples is $4,500 per month. Couples have two income tests – first as a couple; then the applicant’s income as a single person.
- Applicants who fail the test can use a Miller Trust (aka: Income-Only trust) to qualify. There are five major steps to completing this type of trust:
- Create the trust with the specific requirements as dictated by law;
- Sign and notarize the trust;
- Create a bank account titled to the trust;
- Deposit income received into the trust bank account; and
- Make disbursements according to the Trust’s rules.
- Many people think you need an attorney to do this. We’ve been helping folks for over 17 years and we offer the lowest cost in the state: $250 for our basic package. Even our $999 premium package is a great deal. We spend on average about 10 hours helping people with our premium package.
Other health insurance
- Medigap or Medicare Supplement Insurance
- This is health insurance which covers the “gap” between what Medicare covers (typically 80%) and what it doesn’t (typically 20%); it also helps pays deductibles (depending on the plan). This type of insurance almost always has a premium that the customer pays (sometimes retiree plans pay for this). The best time to enroll in this plan is when you turn 65 because you are guaranteed issue during that time.
- ALTCS members DO NOT have to give up this coverage. For members residing in facilities, ALTCS allows the premium as a deduction from their cost of care.
- Because ALTCS is the payer of last resort, all medical bills go through Medicare and any Medicare Supplement before any bills get paid by AHCCCS/ALTCS.
- This coverage gives people the MOST CHOICE and depending on the plan, this type of Medicare insurance typically has the MOST COVERAGE.
- Medicare Advantage Insurance
- These are private health insurance plans that combine Medicare coverage into one plan and whose members must see providers within that plan. Some plans have premiums and some are zero-premium plans. Members pay co-pays for their care and plan limits. Compared to Medicare only, this is a great option to limit maximum out-of-pocket exposure.
- ALTCS members DO NOT have to give up the plan they are already on if they are happy with their providers BUT they need to understand that if their current providers are NOT also ALTCS contracted providers, then ALTCS WILL NOT cover the unpaid portions of those bills. IF they go to providers that are contracted with both their current plan AND ALTCS, then some of their out-of-pocket costs will be covered.
- ALTCS members (and acute care AHCCCS members, too) may be eligible for extra benefits after approval by enrolling in a Dual Special Needs Plan – one that coordinates with their ALTCS program contractor (Mercy Care Plan, Banner University, or UnitedHealthCare).
- The program contractor’s each have their own Dual Special Needs Plan and they are assertive in their attempts to get ALTCS members to switch.
- Many plans have a zero dollar plan premium.
- Many have additional benefits like a health products catalog for OTC items, dental coverage, vision, hearing, some have chiropractic care, etc.
- At our firm, George is contracted with Banner and UHC and can help your residents compare plans to see if a move to this plan makes sense.
- ALTCS applicants must apply for all potential benefits.
- If the applicant has ever worked for federal, state, city, or county government OR for an employer with a pension plan, they need to check into those potential benefits. By asking these questions, we have found $59k for one customer, $70k for another, and $23k for yet another.
- If the applicant is a Veteran or widow of a Veteran who served during wartime, ALTCS requires they apply for benefits. Now, does that mean he/she has to submit a perfected application with the intent to be approved? No, they can choose to do a basic app instead.
- Can people be on ALTCS and VA benefits? YES!!! No, really, YES. Is it always a good idea? No. Sometimes it can become a headache to manage the funds because VA is not good at stopping or reducing benefits when they should or could.
- We want families to make the best decision for their loved one. Many of you promote VA as a way to fund care and many of you use VA planners to do so. That is great except when it’s not. Not everyone gets to stay at home or in assisted living their whole lives and if they need skilled care, the planning some folks do to get VA eligible can sometimes negatively impact their ALTCS eligibility. Some VA planners are not familiar with ALTCS guidelines and if they use irrevocable trusts or annuities to qualify their Veteran or widow for benefits, this can have long-term negative consequences to their ALTCS application. We are versed in both programs and can help educate folks about the pros/cons of planning to get qualified.
Processing timeframe – ALTCS is supposed to make the decision in 45 days. They RARELY meet that timeframe.
- Many people do not realize that they can file an appeal when the case goes over the due date. As long as you’ve provided everything they’ve asked for, I encourage people to file the appeal about a week after the 45th day.
- Our average processing time last year was 59 days; this year it is 54 days.
Consumers do not have to go it alone!
What are the pitfalls of consumers applying for government programs on their own?
- They may get denied by ALTCS or VA and not really understand why.
- They may have to wait until the application processing timeframes are over before they even know there’s a problem. The ALTCS application processing timeframe is at least 45 days. The VA application processing timeframe is at least 120 days. Can they afford to wait???
- They may be making life-changing decisions based on misinformation, missing information, or miscalculation.
- They may end up providing information that the programs really don’t need to make their decision.
- They may end up timing their spend down wrong and cost themselves the approval or worse yet, ineligibility for an extended period of time.
- They may be sold a product that they don’t need.
- They may buy an annuity that supposedly fixes one problem while causing another.
- They may not be told the long-term implications of planning.
- They may increase their cost of care in the long run.
- They may be doing something that is not in their best interest.
- They may be convinced that a particular product will help them but what they may not realize is that the person selling the product is more concerned about the commission they’ll make.
- They may affect the allowance they can give their spouse.