TOP 10 MYTHS IN ELDER LAW (2003)
I. BASIC PRINCIPLES
A. Introduction
The average cost of nursing home care in New Jersey is approximately $7,500 per month. Obviously, private payment can rapidly deplete the average family's financial resources. Federal law provides that nursing home care is not covered by Medicare or a Medicare HMO if it is deemed to be "custodial" rather than "skilled" in nature. Medicare will pay only for "skilled" nursing care or rehabilitation needed as the result of a hospitalization, and then only for a limited amount of time. Long term care insurance is offered in the marketplace, but it is often cost-prohibitive or simply unavailable for seniors or others with any significant medical history.
Thus, Medicaid has become the primary program available for the third-party payment of long-term custodial care in a nursing home. Medicaid is a program of medical assistance funded by both Federal and State governments for low-income individuals who are aged, blind, or disabled. If eligible, Medicaid will cover most costs associated with long-term custodial nursing home care. To be eligible, an applicant must demonstrate a medical need for institutional care and meet basic financial criteria relating to income, assets, and asset transfer penalties.
B. Income
1. Treatment of Income
The fixed income of a Medicaid beneficiary is used to determine which Medicaid program, if any, will be available to the individual. N.J.A.C. 10:71-5.1(b). This includes the beneficiary's Social Security Retirement or Disability Income, Supplemental Security Income ("SSI"), and private pension or retirement benefits, as well as Veteran's Benefits, insurance annuity payments, maintenance in kind, or any other payments that can be used to meet that individual's needs for food, clothing, and shelter. Once eligible for Medicaid, an institutionalized individual will be required to pay his or her income to the nursing home, less an amount set aside to cover certain unreimbursed medical expenses, supplemental health insurance premiums, spousal maintenance (as discussed below), and a $35/month Personal Needs Allowance.
2. Two Medicaid Programs for Nursing Home Care in New Jersey
New Jersey has two Medicaid programs covering nursing home care, denominated "Medicaid Only" (also referred to as "Categorically Needy") and "Medically Needy." There is a monthly income cap for the Medicaid Only program which is set at 300% of the Federal Supplemental Security Income benefit. For 2003, the Medicaid Only income cap is $1,658 per month.
The income cap for the Medically Needy program is 30 times the Medicaid daily reimbursement rate for the facility in question, which is currently approximately $150 to $160 per day. If an individual's income exceeds this amount, he or she may "spend down" his or her income on medical expenses, including nursing home charges, to the extent necessary to reduce his or her income to a level that is under the cap.
The Medically Needy program provides fewer benefits than Medicaid Only. The following coverages are not available to those persons whose income exceeds the Medicaid Only income cap: Assisted Living care, home-health care, in-patient hospital care, payment of Medicare Part B premiums, pharmaceuticals outside of the institution, and chiropractic services.
3. Special Income Rules for Married Persons
For married couples, the incomes of the institutionalized individual (the "institutionalized spouse") and his or her spouse living in the community (the "community spouse") are treated separately for eligibility purposes. Both the Federal and New Jersey State Medicaid laws were revised in 1989 to address, among other things, the issue of "spousal impoverishment" experienced by the community spouse as a result of the Medicaid eligibility process for the institutionalized spouse. The spousal impoverishment legislation provides that the community spouse is entitled to a minimum monthly income (called the "Minimum Monthly Maintenance Needs Allowance" or "MMMNA") with which to pay certain allowable monthly expenses (food, shelter, basic utilities, etc.), as determined by the Medicaid caseworker. If the community spouse's own income is insufficient to meet the MMMNA, then he or she may be awarded a share of the institutionalized spouse's income to make up the difference.
C. Asset Value
1. Countable, Available Assets
Only "countable" assets are considered in determining Medicaid eligibility. In New Jersey, non-countable assets include the family home, certain life insurance policies, certain funds set aside for funeral, cemetery plots, certain property used in business, and personal effects and household goods up to a pre-established maximum amount. N.J.A.C. 10:71-4.4. For an individual, the maximum Medicaid Only countable asset amount is $2,000 and the maximum Medically Needy countable asset level is $4,000.
An asset must be "available" to be countable. N.J.A.C. 10:71-4.1(b). An asset is considered to be available to the institutionalized individual when either he or she has the "right, authority, or power" to liquidate his or her interest in the property or the asset is "deemed available" by operation of law. For example, assets can be "deemed available" to a Medicaid beneficiary when he or she is married or transfers assets for less than fair market value (both concepts are discussed below). N.J.A.C. 10:71-4.6.
2. Special Rules for Married Persons
For married couples, the assets of the institutionalized individual and the community spouse are pooled for purposes of determining Medicaid eligibility. N.J.A.C. 10:71-4.6(c) & -4.8. Before the "spousal impoverishment" rules were implemented in 1989, the Medicaid program would have allowed the community spouse to retain assets in his or her name alone, and the Medicaid eligibility analysis would have focused only on their joint assets and the institutionalized spouse's sole assets.
However, now, all of the spousal resources are considered initially and the Medicaid caseworker will determine the amount of their combined assets that the community spouse may keep. N.J.A.C. 10:71-4.8. The amount to be awarded to the community spouse is known as the Community Spouse Resource Allowance ("CSRA"). The CSRA is determined by computing the value of the couple's total combined assets as of the first day of the first month of institutionalization. As of January 1, 2003, the Community Spouse can keep the greater of $18,132 or one-half (½) of the couple's total countable assets, up to a maximum of $90,660. The assets that make up the CSRA must be transferred to the community spouse within 90 days of Medicaid eligibility.
D. Transfer Penalty
1. Asset Transfers
Assets are valued for Medicaid eligibility purposes at its fair market value-"the price that the resource can reasonably be expected to sell for on the open market in the particular geographic area minus any encumbrances." N.J.A.C. 10:71-4.7(b)1, -4.10 & -4.1(d). If an individual transfers any assets for less than fair market value within the applicable "look back period," then a period of ineligibility for an institutional level of services will be assessed based upon the amount given away. N.J.A.C. 10:71-4.10(c).
2. Look-back Period
The applicable "look-back period" is the 36-month period next preceding the date on which the individual became institutionalized or applied for Medicaid benefits, whichever is later. For transfers to certain trusts, the applicable look-back period is 60 months. N.J.A.C. 10:71-4.10(b)9.
3. Period if Ineligibility
The calculation of the period of ineligibility is based on the "uncompensated value" of the transfer and the average cost of nursing facility care. The uncompensated value of the transfer is the difference between the asset's fair market value and the compensation received. N.J.A.C. 10:71-4.7(b)2 & -4.10(b)7. Thus, transfers for fair market value do not result in a transfer penalty. N.J.A.C. 10:71-4.10(g). Also, by regulation, transfers that are made to a spouse, to another person for the sole benefit of a spouse, to a minor child, to a disabled child, or to a trust solely for the benefit of a disabled individual under age 65 (a statutory "Special Needs Trust") also do not result in a transfer penalty. N.J.A.C. 10:71-4.10(e).
The effect of the transfer penalty is that the uncompensated value of any assets transferred is deemed available to the individual during the time it would take to spend such amount on nursing home care. The calculation is based upon the average monthly cost of nursing home care in New Jersey, which is currently set at $5,540. N.J.A.C. 10:71-4.10(m)1.i. Thus, the length of a Medicaid penalty period is calculated by dividing the amount transferred by $5,540. Please note that the $5,540 penalty divisor is expected to be raised to $6,050 within the next few months.
Current New Jersey law provides that he penalty period begins on the first day of the month in which the transfer was made and that any fractional period of ineligibility is rounded down to the next whole number. For example, if a $11,000 transfer is made on November 30, 2003, the resulting penalty is calculated by dividing $11,000 by $5,540. This equals 1.9 months of ineligibility, which is then rounded down to one (1) month. The one-month penalty begins on November 1, 2003 and ends on November 30, 2003.
Current New Jersey law also provides that when assets are transferred in amounts and intervals that make the calculated penalty periods overlap, the value of all the transfers are added together and divided by the average cost of nursing home care, which results in a single penalty period, beginning on the first day of the month in which the first transfer was made. When assets have been transferred in such a way that the penalty periods do not overlap, then each transfer is treated as a separate event, each with its own penalty period.
It is critical to remember that, even though the look-back period is only 36 months for transfers to individuals, a transfer penalty can be unlimited. For example, a transfer of $554,000 will trigger a penalty period of 100 months ($554,000 $5,540 = 100). If the Medicaid application is made 35 months after the transfer, the penalty period will be 100 months from the date of transfer. If the Medicaid application is made 37 months after the transfer, the applicant will truthfully state that "no transfers have been made within the past 36 months" and the 100 month penalty will not be applied.
II. TOP 10 MYTHS IN ELDER LAW
A. Myth No. 10: Only Half of a Joint Account Will Be Considered "Available"
to a Medicaid Applicant.
1. Rules Governing Joint Accounts
a. Pro Rata Ownership
"When a savings or checking account is held by the eligible individual with other parties, all funds in the account are assets to the individual so long as he or she has unrestricted access to the funds (that is, an "or" account) regardless of their source. When the individual's access to the account is restricted (that is, an "and" account), the CBOSS [County Board of Social Services] shall consider a pro rata share of the account toward the appropriate asset maximum, unless the client and the other owner demonstrate that actual ownership of the funds is in a different proportion. If it can be demonstrated that the funds are totally inaccessible to the client, such funds shall not be counted toward the asset maximum." N.J.A.C. 10:71-4.1(d)2 (emphasis added).
b. Restricting Account Control Is a Transfer
"When an asset is held by an individual in common with another person or persons via joint tenancy, tenancy in common, joint ownership, or similar arrangements, the asset (or the affected share of the asset) shall be considered to be transferred by the individual when any action is taken, either by the individual or any other person, that reduces or eliminates the individual's ownership or control of the asset . . ." N.J.A.C. 10:71-4.10(o).
c. Ownership Change Is a Transfer
"If the addition of another name to the ownership of an asset restricts the individual's access, right to sell or otherwise dispose of the asset . . . the addition of the name shall constitute a transfer of assets." N.J.A.C. 10:71-4.10(o).
d. Funds Withdrawn by Another Constitutes a Transfer
"Any portion [of a joint account] belonging to the individual that is withdrawn by another owner shall be considered a transfer of assets. If the individual can satisfactorily establish that the withdrawn funds were, in fact, the sole property of, and were contributed to the account by the other owner, and thus never belonged to the individual, the withdrawal of those funds shall not result in the imposition of an asset transfer penalty." N.J.A.C. 10:71-4.10(o).
2. Result
Changing ownership of an account from individual to joint is a transfer of assets for less than fair market value which could trigger a period of Medicaid ineligibility if it occurs with the look-back period. All funds in a joint "or" account are attributable to the individual unless proven otherwise. Half of the amount of an individual's funds deposited into a joint "and" bank account will be considered transferred for less than fair market value upon deposit, which could result in a period of Medicaid ineligibility if the deposit occurs with the look-back period. Withdrawals from a joint account are subject to transfer penalty rules unless it can be shown that the funds were the sole property of another owner.
B. Myth No. 9: Married Couples Should Transfer Residence to Children to "Protect" It
1. Lifetime Transfer Could Create Negative Medicaid Consequences
A period of Medicaid ineligibility will be assessed for any transfer for less than fair market value to a person other than a spouse, another for the sole benefit of a spouse, a minor child, a disabled child, or a qualified statutory Special Needs Trust. Therefore, transferring ownership of the parents' residence to their children will result a penalty based upon the value of the house at the time of the transfer if a Medicaid application is filed within the 36 month period following the transfer. If both spouses are living, and as long as one spouse is living in the residence, the residence is exempt for Medicaid purposes. Thus, transfer of an otherwise exempt resource (the residence) would create a period of disqualification.
2. Lifetime Transfer May Result in Capital Gain Recognition
Carryover basis to children and loss of Section 121 exclusion are often overlooked by attorneys and families who choose to simply "deed the house for a dollar" and thus protect it. Some believe that a retained life estate will solve the capital gain problem; many times, however, the house is sold during the senior's lifetime.
C. Myth No. 8: IRAs Are Considered Exempt for Medicaid Purposes
1. Rules Governing IRAs
a. New Jersey Law
The community spouse's IRA is an includable resource for purposes of determining the institutionalized spouse's Medicaid eligibility. Mistrick v. Division of Medical Assistance & Health Services, 154 N.J. 158 (1998); S.M. v. Division of Medical Assistance and Health Services and Passaic County Board of Social Services, 96 N.J.A.R.2d (DMA) 37; see N.J.A.C. 10:71-4.4 (Excludable Resources). Different results obtain in other states, however (cf. Pennsylvania and Florida).
D. Myth No. 7: Transfer to Trust Creates 5 Year Ineligibility Period; Other Transfers Create 3 Year Ineligibility Period
Asset transfers for fair market value do not result in a transfer penalty. N.J.A.C. 10:71-4.10(c). Transfers that are made to a spouse, another for the sole benefit of a spouse, a minor or disabled child, or a trust solely for the benefit of a disabled individual under age 65 (a "Special Needs Trust) also do not result in a transfer penalty. N.J.A.C. 10:71-4.10(e).
A transfer for less than fair market value to an irrevocable trust other than a Special Needs Trust creates 5 year look-back period. N.J.A.C. 10:71-4.10(b)9. A transfer for less than fair market value to an individual other than a spouse, another for the sole benefit of a spouse, a minor child, or a disabled child creates a 3 year look back period. N.J.A.C. 10:71-4.10(b)9.
Thus, if a non-exempt transfer is made to a non-exempt recipient, the length of the period of ineligibility will depend on the amount of transfer and whether the transfer occurred during the applicable look-back period.
E. Myth No. 6: Annuities Can Be Used to Shelter Assets
1. Rules Governing Annuities
a. "Any annuity purchase in which the entity issuing the annuity is not a commercial financial institution shall be considered to be a transfer of an asset in order to qualify for Medicaid benefits, regardless of the terms of the annuity payout. The entire amount transferred into such an annuity shall be the amount considered in determining eligibility." N.J.A.C. 10:71-4.10(p)1.
b. "Any commercial annuity purchased which is not actuarially sound, based on the life expectancy of the individual . . . or term certain . . . shall be considered to be a transfer of an asset in order to qualify for Medicaid benefits. In the event that an annuity is not actuarially sound at the time of purchase, the amount that shall be considered to have been transferred at less than fair market value shall be that proportion of the annuity purchase price which is not actuarially sound." N.J.A.C. 10:71-4.10(p)2.
c. Commercial annuities purchased that are actuarially sound, based on the life expectancy of the individual, and a term certain must name the State of New Jersey as the first remainder beneficiary. N.J.A.C. 10:71-4.10(f); see A.B. v. Division of Medical Assistance and Health Services and Passaic County Dept. of Human Services, OAL Docket Nos. HMA 3280-01 & 3925-02 (DMAHS 2003) (Final Agency Decision).
d. "If an annuity is purchased for a community spouse with any portion of the couple's funds and the annuity purchase price exceeds the amount of the protective share of the community spouse . . . the amount in excess of the community spouse's protected share shall be counted in determining the applicant's eligibility." N.J.A.C. 10:71-4.10(p)2.i.
e. "Payments received in an annuity . . . shall be included as unearned income." N.J.A.C. 10:71-5.4.
f. Both the interest and the principal of community spouse's monthly annuity payments constitute income for purposes of determining minimum monthly maintenance allowance. J.M. and E.M. v. Division of Medical Assistance and Health Services, 96 N.J.A.R.2d (DMA) 86.
F. Myth No. 5: Guardians and Attorneys-in-fact (POA) Can Make Transfers of
Assets for Ward/Principal
1. Express Authority to Gift Required in POA
"A power of attorney shall not be construed to authorize the attorney-in-fact to gratuitously transfer property of the principal to the attorney-in-fact or to others except to the extent that the power of attorney expressly and specifically so authorizes. An authorization in a power of attorney to generally perform all acts which the principal could perform if personally present and capable of acting, or words of like effect or meaning, is not an express or specific authorization to make gifts." N.J.S.A. 46:2B-8.13a., effective date January 27, 2004.
2. Guardian's Authority to Gift Highly Restricted
a. In the Matter of Mildred Keri, 356 N.J. Super. 170 (App. Div. 2002), cert. granted, 175 N.J. 549 (February 28, 2003). In this case the Appellate Division held that "when the incompetent has not indicated a preference for Medicaid planning while competent, we will not prematurely force enrollment on the public dole at the guardian's request for the benefit of the incompetent's self sufficient children. A purely subjective standard is called for in this context to protect the incompetent's right to self determination."
b. According to the Keri Court, a court-appointed guardian will not be authorized to make gifts for Medicaid planning purposes unless the ward had previously manifested a subjective intention to do so.
c. On February 28, 2003, the New Jersey Supreme Court agreed to hear this case on appeal. Oral arguments were held on October 20, 2003. The Court's decision is pending.
G. Myth No. 4: Medicaid Will Pay for Only Nursing Home Care, Not Assisted Living or Home Care
Prior to 1981, Medicaid provided for long-term care benefits primarily through institutionalization in a nursing home. The Omnibus Budge Reconciliation Act of 1981 (P.L. 97-35) ("OBRA '81") amended the federal Medicaid statute to allow states to request the Federal government to "waive" certain Medicaid requirements in order to allow long-term care services in settings in the home or in the community. This waiver, known as the "Section 1915(c) waiver," permits home and community based services for those who would be institutionalized in a nursing facility but for the provision of waiver services. See 42 U.S.C. §1396n(c), Social Security Act § 1915(c). In New Jersey, pursuant to the ECO (Enhanced Community Options) Waiver, Medicaid may pay for Assisted Living and community-based (home care, adult medical day care, respite care) services for individuals eligible for the Medicaid Only program (i.e. having fixed monthly income below $1658 and resources at or below $2,000).
1. Home Health Waiver: "Community Care Program for the Elderly
and Disabled ("CCPED")
a. CCPED Program Description
In October, 1983, the New Jersey Division of Medical Assistance and Health Services ("DMAHS") requested a § 1915(c) waiver pursuant to OBRA '81. The New Jersey Community Care Program for the Elderly and Disabled ("CCPED") is the Medicaid Waiver program which pays for home-based and community (e.g., Adult Medical Day Care) services to eligible persons who might otherwise require nursing home level of care. Specifically, CCPED may pay for case management, home health services, homemaker services, adult medical day-care, non emergency medical transportation, respite care, and social day care and prescribed drugs.
b. CCPED Program Coverage Limitations
Statewide, there are only approximately 3,500 "slots" available, which are allocated to the various counties by DMAHS. In some counties, clients may have to wait before receiving necessary services.
There is also a cost cap on each individual's service package. Full-time at-home services (24/hour a day, 7 day a week care) is rarely, if ever, provided under the CCPED program.
2. Assisted Living Waiver Program
In 1996, the DMAHS requested a section 1915(c) waiver pursuant to OBRA '81 to provide assisted living services.
a. Assisted Living Waiver Program Description
The Assisted Living and Alternate Family Care ("AL/AFC") Waiver was approved by the Federal Health Care Financing Administration ("HCFA") in 1996. Medicaid providers of assisted living services must be licensed by the New Jersey Department of Health and Senior Services ("DHSS"). AL/AFC is available statewide to eligible New Jersey residents. The availability of AL/AFC services is determined by the location of providers licensed by the DHSS and by the availability of openings in the program. The waiver allows for a total of 2,250 slots statewide. Distribution of these slots is managed through the DHSS Office of Waiver and Program Administration.
b. Room and Board; Cost Share
All participants are required to pay for the "room and board" portion of the monthly charge, currently $620.55/month for residents of an Assisted Living Residence or Comprehensive Personal Care Home. Participants retain $85.00 per month for personal needs ("personal needs allowance or PNA"). If a participant's monthly exceeds the room and board amount plus PNA plus the cost of his or her supplemental health insurance premiums, the participant is required to pay the remaining income to the provider as a "cost share" in addition to the room and board charge. The cost share is calculated by the Case Manager who is assigned by DHSS.
3. Waiting Lists for Home-Health and Assisted Living Programs.
The availability of Medicaid waiver program services is limited as the total number of "slots" for each program is fixed, and a waiting list often applies.
a. CCPED Wait List
There are approximately 3500 "slots" available statewide, which are allotted to the various counties by New Jersey Department of Health and Senior Services on the basis of county population. Historically, in many counties, clients often must wait several months after financial eligibility is determined before receiving necessary services. Such delays force some applicants to move into a nursing home because the applicant cannot afford to private pay for services for several months. The State will not reimburse the applicant for services provided prior to enrollment in the program.
b. Assisted Living Wait List
AL/AFC is available statewide to eligible New Jersey residents. The availability of AL/AFC services is determined by the location of licensed providers and by the availability of openings in the program. The waiver currently allows for a total of 2,250 slots statewide. Current information regarding New Jersey legislative planning for the AL/AFC Waiver program indicates that an additional 375 slots may be made available in July of 2004. A similar potential increase is planned for 2005. Currently, there is a waiting list of approximately 100 applicants. This number will likely rise significantly before the next allocation of slots is made. Again, these delays force some applicants to move into a nursing home because he or she cannot afford to private pay for services for several months.
H. Myth No. 3: Special Needs Trusts Are Necessary to Protect the Proceeds of a Personal Injury Lawsuit or Inherited Funds for a Disabled Person
1. Special Needs Trusts.
Generally, statutory (42 U.S.C.A. 1396p (d)(4)(A)) "Special Needs Trusts" are advisable when a recipient of funds from a medical malpractice or personal injury award or inheritance demonstrates need for lifelong specialized and costly services, which services would not be paid by any source other than Medicaid. Such a "Special Needs Trust" would preserve the recipient's eligibility for SSI cash benefits and Medicaid.
a. SSI and Medicaid
SSI is available to individuals with disabilities that commence prior to age 22 if the disability impacts significantly on employment and the individual meets the asset and income limitations of the SSI program. An individual who is eligible for SSI will also be eligible for Medicaid benefits.
b. SNT Limitations
A Special Needs Trust allows the recipient's settlement funds to be used only to supplement any government benefits her or she may receive during his or her lifetime and would thus not be considered "available" to the recipient for purposes of qualifying for government programs such as SSI and Medicaid, which employ economic means testing for program eligibility. N.J.A.C. 10:71-4.11(g).
However, Federal law requires that a "Special Needs Trust" conform to the following requirements:
(1) it must be established prior to the time the recipient attains the age of 65 years;
(2) it must be established for the "sole benefit of" the recipient by a parent, grandparent, legal guardian, or a court; and
(3) it must specifically provide that, following the recipient's death, the State will be repaid all amounts remaining in the trust up to the total value of all Medicaid benefits paid on the recipient's behalf during her lifetime. N.J.A.C. 10:71-4.11(g).
2. Irrevocable Support Trust.
As mentioned above, a statutory "Special Needs Trust" would generally be advisable when a disabled individual demonstrates need for lifelong specialized and costly services, which services would not be paid by any other source than Medicaid. But, in a case where the recipient does not appear to require any medical or residential/custodial care which is not currently paid by commercial insurance, nor education which is not paid by the recipient's school district, it may not be advisable for the settlement funds to be held in a statutory "Special Needs Trust." Rather, an irrevocable "Support Trust" might allow better use of the funds for the recipient's benefit.
a. An irrevocable "Support Trust" does not have the "sole benefit" requirement of a statutory SNT. It can therefore strike a balance between the recipient's needs and the needs of the family, recognizing that the parents have an obligation to support their child financially, but acknowledging as well the parents' significant caregiving responsibilities.
b. An irrevocable "Support Trust" does not have the "state payback" requirement of a statutory SNT. It can therefore avoid the risk of foreclosure on trust property (such as the family's residence) by the State if the recipient dies prematurely.
c. Because an irrevocable "Support Trust" is not a statutory "Special Needs Trust," the recipient will not be entitled to receive SSI benefits, nor will he or she be eligible for Medicaid benefits as long as the Trust remains in its present form. Accordingly, the trust agreement should provide that, if at any time the Trustee determines that the recipient would benefit from services which are not covered by available health insurance or school district programs but would be covered under the Medicaid program, the Trustee is specifically authorized to distribute any part or all of the remaining principal to a "Special Needs Trust" as defined by 42 U.S.C. 1396p(d)(4)(A) and 42 U.S.C. 1382b(e)(5), for the recipient's sole benefit.
I. Myth No. 2: Quality of Nursing Home Care Will Deteriorate after Client Becomes Eligible for Medicaid
J. Myth No. 1: Gifts to Children Should Be Made in Accordance with Gift Tax Annual Exclusion
Many clients make gifts in the amount of $10,000 per person (most are unaware of the increase in the annual exclusion to $11,000) at the end of one calendar year and the beginning of another, as they are "allowed." The Medicaid transfer rules ignore the number of donees receiving the transferred funds, and simply divide the total amount(s) gifted in any calendar month by the average cost of care ($6,050 in New Jersey, eff. 11/1/03).
If the purpose of the transfer is long term care planning, clients should be advised that annual exclusion gift tax limits are irrelevant. Further, Medicaid transfer rules do not recognize the tuition or medical expense exception (unless a client could show a consistent pattern of gifting prior to the incapacity, such that the transfer(s) were not made "for the purpose of qualifying for Medicaid."
|
