Benefit Bulletin: January 2013
Can You Be Held Responsible For Parent’s Nursing Home Tab?
Although much of the recent debate is focused on Medicare, seniors and their adult children have almost as much at stake in the future of Medicaid. Medicaid is a joint federal and state program that is the primary payer of long-term care services, needed by seniors, and disabled adults, to live independently in their own homes, and for institutional care like nursing homes.
Faced with rapidly rising Medicaid costs and budget deficits, some states are seeking more flexibility in setting minimum eligibility, standards of care, and changing federal rules that now protect adult children from being billed for their parent’s Medicaid care. Today, 29 states have “filial support” laws that could be used by states to seek payment for unpaid long-term care bills from patients’ adult children. Enforcement of the laws is rare, but in Pennsylvania, nursing homes have started using the law to get families to pay their parents’ bills or to complete required Medicaid paperwork on their behalf.
Unlike Medicare, which is earned through years of payroll tax withholding, Medicaid is provided from general revenues and is a payer of last resort. Individuals only qualify after they have exhausted almost all of their income and savings. Paying for long-term care services can quickly drain lifetime savings of even middle income patients and their families who provide a great deal of un-reimbursed care. Nursing homes average $74,800 per year, assisted living can average $39,500, and home health services average $21 per hour.
Although stronger enforcement of filial support laws still remains uncommon, many states are looking into new ways to cut spending on long-term care. Twenty-six states have plans to move about 2 million low-income senior and disabled dual eligibles — patients who receive both Medicare and Medicaid — into a new types of managed care health plans.
Most of the plans will be reimbursed a single payment to provide all services, or they will have to achieve targets established to lower state and Medicare spending. States will be allowed to “passively enroll” beneficiaries, meaning low-income seniors and disabled adults would be assigned to a managed care plan unless they or their family take action to disenroll.
The idea is to cut costs while providing better quality care. Although the new plans hold potential; low - income senior patients are among the sickest and poorest and the most vulnerable when care is disrupted. It remains unclear how states will notify and educate patients and their families about the transition, how the programs intend to cut costs, and how beneficiaries will be ensured access to medically necessary services.
TSCL encourages those of you with family members receiving long-term care to learn whether there are prospective plans to transfer low-income seniors in your area to new managed care plans. Contact your local Medicaid department, or your Area Agency on Aging.
Sources: “Are You On The Hook For Mom’s Nursing Home Bill?” Kelly Greene, The Wall Street Journal, June 22, 2012. Medicaid and Long-Term Care Services and Supports, Kaiser Family Foundation, June 2012.