ElderLaw News

ElderLaw News is a weekly e-newsletter that brings you reports of legal developments and other trends of vital interest to seniors and their advocates. This newsletter is brought to you by The Estate Planning & Elder Law Firm, P.C., William S. Fralin, Esq., President.

NEW LAW, NEW OPPORTUNITIES

The Estate Planning and Elder Law Firm has reviewed Transmittal #84 from the Department of Medical Assistance Services. Although many of the new Medicaid Manual sections parallel the provisions of the Deficit Reduction Act of 2005 (DRA), several provisions are new. We will highlight the key aspects of Transmittal #84 in this and future editions of the Elder Law News.

The first non-DRA Medicaid Manual change pertains to the release of confidential applicant information. Medicaid Manual section M0110.100 (C)(3)(c) now provides that:

[I]ndividuals not determined to be incapacitated by a court can designate whomever they choose to be their authorized representatives, including a provider or a provider's contractor (such as an application assistance company). The designation must be in writing, with the applicant or recipient specifying the information to be released to the authorized representative. It is not sufficient to indicate that any information in the case record may be released; the designation must state the specific information to be released (i.e. notices, the ability to make application or provide information necessary to determine eligibility, and what, if any, other information can be released to the authorized representative). The authorized representative designation is valid for the life of the application.

An applicant must provide specific written authorization for another individual or law firm to receive information about the applicant or the application. Such authorization includes a release or a power of attorney.

The most significant non-DRA change to the Medicaid Manual as a result of Transmittal #84 pertained to life estates, otherwise known as life rights. These changes have been superceded by the Virginia Department of Social Services on July 12, 2006 by Broadcast 3822, and will be reflected in Transmittal #85. Medicaid Manual section M1110.515 (A)(2)(a) defines a life estate as certain rights in a property conferred upon one or more persons for his/her/their lifetimes or the life of some other person by deed, will or operation of law. Paragraph (B)(1)(a) provides that the owner of a life estate has the right to and to sell his or her life estate interest. Prior to Transmittal #84, a life estate (life rights) in real property was not counted as a resource. Transmittal #84 changed this policy and stated that a life estate (life rights) in real property would not be counted as a resource when it was obtained prior to February 8, 2006. For a life estate obtained on or after February 8, 2006, the life rights would not be counted as a resource when the property serves as the individual's principal place of residence, but life rights would be counted as a resource when the property no longer served as the individual's principal place of residence. Under Transmittal #84, these new rules were reiterated in Medicaid Manual section M1140.110 (A)(6). Fortunately, Broadcast 3822 and Transmittal #85 reverse this policy and restores the original policy that a life estate (life rights) in real property does not count as a resource to applicants or recipients, except for persons in the Qualified Working Disabled Individuals (QDWI) covered group, regardless of when the life estate was obtained.

Broadcast 3822 also incorporates the DRA provision that funds used to purchase a life estate in another individual's home after February 8, 2006 must be evaluated as an uncompensated transfer, unless the purchaser resides in the home for at least 12 consecutive months. If the purchaser resides in the home for less than 12 consecutive months, the entire amount of the purchase will be considered a transfer for less than fair market value. Transmittal #85 will include further guidance on implementation of this policy.

Broadcast 3822 also clarifies the documentation requirements for citizenship and identity, pursuant to guidance from the Centers for Medicare and Medicaid Services (CMS). The new policy states that Medicaid applicants and recipients who declare that they are U.S. citizens and who are enrolled in Medicare or who receive Supplemental Security Income (SSI) have already met the DRAs citizenship and identity requirements. This includes individuals whose SSI has been terminated. Transmittal #85 will contain further guidance on implementation of this change. This is a major change from the DRA and the policies outlined in Transmittal #84 regarding documentation of citizenship and identity.

These are a few of the new changes in the law that highlight the need for people to continue to plan carefully for their long-term care needs. The attorneys at The Estate Planning and Elder Law Firm can help plan for the payment of these expenses and the protection of assets.

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The Estate Planning & Elder Law Firm, P.C.

The Estate Planning & Elder Law Firm, P.C. is an elder law firm. We represent older persons, disabled persons, their families, and their advocates. The practice of elder law includes estate planning, estate and trust administration, powers of attorney, advance medical directives, titling of assets and designations of beneficiaries, guardianships, conservatorships, and public entitlements such as Medicaid, Medicare, Social Security, and SSI, disability planning, income tax planning and preparation, care management, and fiduciary services. For more information about The Estate Planning & Elder Law Firm, P.C., please visit our website at http://www.chroniccareadvocacy.com.

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This newsletter is not intended as a substitute for legal counsel. While every precaution has been taken to make this newsletter accurate, we assume no responsibility for errors, omissions, or damages resulting from the use of the information in this newsletter. The Estate Planning & Elder Law Firm, P.C. thanks the law firm of Hook Law Center for their input to this newsletter.

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