Medicaid & Long Term Care Planning
Since 1982, Arizona has participated in the Medicaid program through the operation of the Arizona Health Care Cost Containment System (AHCCCS) under a federal waiver allowing payment of federal Medicaid dollars into our homegrown version of a managed care program. In 1987, the state legislature added long term care services to the AHCCCS program by establishing the Arizona Long Term Care System (ALTCS) for Medicaid-eligible persons who are elderly (over age 65), or physically or developmentally disabled. As a result, ALTCS is a separate division of AHCCCS, operating under Medicaid long term care rules. Although the names are different, it is correct to say that ALTCS is Medicaid.
Benefits available under the ALTCS program range from home care services and assisted living to care rendered in an adult foster care home or skilled nursing facility. Because ALTCS is a needs-based program, a person must be both medically and financially "needy" or eligible before long term care services are rendered.
Medical eligibility is determined by a pre-admission screening (PAS) conducted by a nurse and/or social worker. The screening consists of both a functional and medical assessment. Different screening tools are used to assess medical eligibility of the elderly, or physically or developmentally disabled. The primary consideration is the individual's ability to perform his or her activities of daily living (ADLs), such as mobility, transferring, toileting, dressing, feeding, bathing and grooming. The individual's diagnosis, sensory function, orientation, emotional/cognitive behavior and necessary medical services and treatments are also considered. The overall purpose of the PAS is to determine whether the individual is at risk for institutional placement.
Financial eligibility consists of both income and resource requirements, which vary depending on whether the person who is applying for benefits is single or married. The following provides basic information concerning such requirements.
- Income Requirements:
- Single person: limited to $1,809.00 month.
- Married person: The applicant can meet the income eligibility
requirement if:
- The total income of both spouses does not exceed $3,618.00 month, or,
- The total income received by the applicant under his/her name as well as half of the income received in both names does not exceed $1,809.00 per month.
- The total income received by the applicant under his/her name does not exceed $1,809.00 per month.
- If a single applicant's income exceeds the monthly income amount, but is under $4,507.06 a month if they live in Maricopa, Pima, or Pinal county, $4,189.44 a month if they live in any other county, an "income-only" trust can be established which will still allow the individual to qualify. If the applicant is married he or she can qualify for an income only trust if the income received in the individual's name plus ½ of the joint income is less than $4,507.06 per month, or if the combined income of both spouses does not exceed $9,014.12 per month if they reside in Maricopa, Pima, or Pinal counties. In any other county of residence in Arizona the limit is $4,189.44 for the income received in the individual's name plus ½ of the joint income or $8,378.88 in combined income for both spouses.
- Resource Requirements:
- Single person: The applicant cannot have more than $2,000.00 in countable resources to qualify for ALTCS. (An applicant who is disabled and under age 65 may become eligible under certain conditions by the establishment of a trust even if countable resources exceed $2,000.00).
- Married person: The applicant's spouse may retain half of the total countable resources of both spouses, except that the half retained cannot exceed the maximum of $99,540.00, and the spouse may keep a minimum of $19,908.00 even if half is less than $19,908.00. In addition to the half that the spouse retains, the applicant is still permitted to retain $2,000.00. Under most circumstances, if both spouses in a marriage are applicants then each is limited to $2,000.00 in resources.
- Single and Married persons: Certain resources are considered
excluded and therefore may be retained in addition to the countable
resources. In general these resources include the following:
- The primary residence, if the applicant and/or his spouse have an ownership interest in the property and the applicant states its his or her intent to return home, or if a spouse or dependent relative is living in the home. Note, a primary residence held in trust is countable for ALTCS purposes.
- An automobile.
- A burial fund of $1,500.00 for each spouse set up in a bank account and labeled as such, or as part of a prepaid burial plan. If the burial plan is funded by the irrevocable assignment of proceeds of a life insurance or annuity policy, there is no value limit to the plan as long as the proceeds assigned do not exceed the fair market value of the burial plan.
- Burial plots for the applicant and spouse and members of immediate family of an unlimited value. The burial plot exclusion includes the cost of the headstone, casket, niche, burial container, opening and closing the grave and perpetual care.
- Household goods and personal effects.
- The combined cash value of all life insurance policies insuring any one individual with a combined face value that does not exceed $1,500.00
- The assets of a trust created for the benefit of a disabled
person under the age of 65 with his or her resources if the
trust is established by a parent, grandparent, guardian or
conservator, or court, and if the trust contains a provision
whereby AHCCCS is reimbursed the cost of services rendered
to the individual, which is the capitated rate, at the time
of his or her death.
- Transfers:
Single and Married persons: Any transfers or gifts made to someone other than a spouse within 36 months prior to applying for the ALTCS program must be disclosed to ALTCS, or 60 months prior to application in the case of transfers to or from a trust. ALTCS then calculates a period of ineligibility by dividing the total amount transferred by the average monthly cost of care in the county as determined by ALTCS, which is currently $4,507.06 in Maricopa, Pima, or Pinal Counties, and $4,189.44 in all other Arizona counties. The resulting figure is the number of months of ineligibility, with fractions being rounded down. The period of ineligibility runs from the date of the transfer, with the first month being the month in which the transfer was made. If a transfer is made within a period of ineligibility resulting from a prior transfer then the amount of the recent transfer is added to the prior transfer, and the ineligibility period runs from the date of the first transfer.
Certain transfers do not result in a period of ineligibility. For example, gifts by a client in a calendar month totaling less than the average monthly private pay rate for nursing home care as determined by ALTCS, currently $4,507.06 in Maricopa, Pima, or Pinal Counties, and $4,189.44 in all other Arizona counties, do not result in the imposition of a period of ineligibility. In addition, any gift made prior to 36 months before applying for ALTCS benefits will not result in the imposition of a period of ineligibility, unless the transfer was made from a revocable trust or, in most cases to an irrevocable trust, in which case the "look back period" is 60 months. Transfers to a spouse and transfers of an excluded resource other than a home, also do not result in the imposition of a period of ineligibility. There are also other limited instances in which transfers do not result in a period of ineligibility, such as transfers to/from a spouse, transfers to a disabled child or to a trust for a disabled child's benefit, transfers to a disabled under age 65 trust which is described above, and transfer of an excluded resource other than a home unless certain criteria are met. - Share of cost:
- Single person: Once the applicant qualifies for ALTCS and is receiving services, he/she may have to pay a share
of the cost of his care on a monthly basis. While living in a skilled nursing facility, he/she will only be
permitted to keep a small spending allowance, currently $90.45 per
month. He/she is able to pay non-covered medical
expenses, including the cost of Medicare and other insurance premiums.
The remaining balance of his or her monthly income will be paid to the
skilled nursing facility as "share of cost".
If the applicant resides at home or in an alternative residential setting he/she will be entitled to keep $1,809.00 as a personal needs allowance. A share of cost will not be assessed at all if the applicant receives services in the home, unless perhaps, if an income only trust has been established. - Married person: Once a married person qualifies for ALTCS he or she is entitled to keep their monthly allowance ($90.45 for persons in a skilled nursing facility/$1,809.00 for persons in other living arangements) plus enough income to cover his or her non-covered medical
expenses, including insurance premiums. In addition, the applicant's spouse
may be entitled to keep a portion of the applicant's income, known as the
community spouse monthly income allowance (CSMIA). At a minimum, a community spouse is entitled to $1,604.00
per month, plus a standard utility allowance of $283.00 (when applicable) plus the actual monthly mortgage
or rent, property taxes, insurance and homeowners association fees minus
$482.00. The resulting total cannot exceed $2,488.50 per month.
If the spouse does not have enough of his or her own income to
cover this amount, then the spouse is entitled to receive enough
money from the applicant's income to make up the difference. The rest of
the applicant's income must be paid to ALTCS
for the share of cost. Share of cost is never assessed against the spouse's income.
A share of cost will not be assessed at all if the applicant receives services in the home, unless perhaps, if an income only trust has been established.
- Single person: Once the applicant qualifies for ALTCS and is receiving services, he/she may have to pay a share
of the cost of his care on a monthly basis. While living in a skilled nursing facility, he/she will only be
permitted to keep a small spending allowance, currently $90.45 per
month. He/she is able to pay non-covered medical
expenses, including the cost of Medicare and other insurance premiums.
The remaining balance of his or her monthly income will be paid to the
skilled nursing facility as "share of cost".
- Estate Recovery:
If a person has received services through the ALTCS program after the age of 55, then AHCCCS will have a claim to recover the cost of services rendered to that individual during his or her lifetime against assets subject to probate. Note that at present ALTCS will only recover against the probate estate as defined by Arizona law and will not recover against joint tenancy property, life insurance proceeds or designated beneficiaries on pension plans or IRA's. ALTCS will not implement estate recovery if the spouse survives the ALTCS recipient or if there is a disabled child. - Liens:
Arizona may impose liens for ALTCS recipients who are age 55 or older, and who are permanently institutionalized (i.e., residing in a skilled nursing facility) for at least 90 days. AHCCCS may place a lien on the recipient's interest in real property during their lifetime, including property owned by a life estate deed and/or subject to a beneficiary deed. AHCCCS shall seek to recover the lien upon the sale or transfer of the real property subject to the lien. For example, if there is an intention to sell or transfer the real property before the death of the member, the lien must be satisfied first. However, a lien may not be imposed or a claim recovered on a member's home if any of the following individuals are lawfully residing in the home: spouse, individual's child under the age of 21 or blind or disabled child, or an individual's sibling (who had an equity interest in the home), and who was residing in such individual's home for a period of at least one year immediately before the date the individual was admitted to a medical institution. In addition, AHCCCS shall not seek to recover the lien or attempt recovery against any real property subject to the lien so long as the member is survived by the member's spouse, child under the age of 21, or disabled child. AHCCCS shall also not seek to recover a lien on an individual's home if the member is survived by a sibling who resided in the deceased member's home and who was residing in the home for at least one year before the member's institutionalization, or a child resides in the home who lived there for at least two years immediately before the admission to a nursing home and provided care to the parent, which allowed the parent to reside at home rather than in an institution.
NOTE: This is a basic general outline only and the numbers are subject to change. The numbers are effective as of 01/01/2006.
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