The Bench & Bar magazine is published to provide members of the KBA with information that will increase their knowledge of the law, improve the practice of law, and assist in improving the quality of legal services for the citizenry.
Issue link: https://kentuckybenchandbar.epubxp.com/i/132126
Medicare coverage is similar to that provided through private insurance, in that it covers a portion of the cost of medical care. There may be deductibles and co-payments required of the participant. There are two substantive coverage components in Medicare coverage, referenced as Part A and Part B. Part A provides coverage for inpatient hospital care, hospice care, inpatient care in a skilled nursing facility, and some home health services. Part B is optional and covers doctor provided medical services, durable medical equipment, and some outpatient care and home health services. Part A is largely funded by federal payroll taxes paid into Social Security by employers and employees and Part B is funded through monthly premiums paid by participants and by general revenues from the federal government. Participants also share costs through the deductibles and co-pays required for many services under Parts A and B. Many people use their own funds to purchase Medicare supplement policies through private insurance companies, which provide additional insurance to cover the costs of the deductibles and co-pays. Medicare should not be confused with Medicaid, as a person's income and assets are not a consideration in determining eligibility or benefit amount. Medicare is a national program and procedures should not vary significantly from state to state. The Medicare skilled nursing care/nursing home benefit has a maximum coverage period of 100 days. If coverage requirements are met, the person is entitled to full coverage for the first 20 days of a nursing home stay and for days 21-100 the person pays a daily co-pay amount that is adjusted annually. Generally, the Medicare home health benefit requires the patient to be homebound and need skilled nursing care on an intermittent basis. The physician must sign a care plan and the care must be provided by a Medicare certified provider. The homebound requirement can be met if leaving home requires considerable effort, as for example, the needing of personal assistance or the use of a wheelchair. Attendance at an adult day care center will not be an automatic bar to meeting the requirement. There is no co-pay or deductible and home health services may include part-time or intermittent nursing care and physical, occupational or speech therapy. LONG TERM CARE INSURANCE Long Term Care Insurance is privately contracted health insurance for long term care expenses. The coverage is generally activated when the insured needs assistance with certain activities of daily living as defined by the particular terms of the policy. A long term care policy generally will provide coverage for home health care (not covered by Medicare), care offered where one resides in assisted living, memory care, or personal care facilities, and nursing home care. Additionally, a policy may provide coverage benefits for adult day care, respite care, and hospice care (not covered by Medicare). This type of private insurance first began gaining popularity in the late 1980s. Unfortunately, these early plans often offered limited coverage by generally only covering skilled nursing care, i.e. nursing homes. Also, there were often low daily benefit rates and there were even exclusions for dementia. These early policies may have been more affordable than those presently available, but they were certainly not always appropriate. A good long term care policy today will offer the insured better choices by not limiting coverage to skilled nursing care and will provide coverage benefits in your home, in an assisted living setting, etc. A long term care policy can be helpful by enhancing one's options and choice of providers and facilities. Such a policy may result in one preserving assets and avoiding the Medicaid process. When analyzing a long term care policy, factors to be considered would include: 1) whether family members can be paid for services; 2) the number of days of disability required before benefits will begin; 3) how facilities and ADLs are defined; 4) the amount of the daily benefit rate and whether there is a cost of living increase built in the policy benefit; 5) whether there is a waiver of premium when benefits are being paid out; 6) annual cost and what the forfeiture provisions are in the policy; 7) what is the total maximum benefit amount that will be paid out under the policy, i.e. the maximum benefit period, and 8) what services are covered? The limits of long term care insurance include its affordability and age restrictions, as this option becomes less affordable the longer one waits to purchase coverage. Additionally, persons may be excluded due to certain pre-existing conditions and, such policies may be oversold to those who may otherwise qualify or very easily qualify for Medicaid benefits. When considering long term care insurance, one should be aware of Kentucky's Long Term Care Partnership Program.5 Anyone purchasing a long term care policy would be well advised to make sure it is a partnership policy. A partnership qualified long term care policy allows you to apply for Medicaid under modified eligibility rules that include a feature called an "asset disregard." This allows one to keep assets that they otherwise would not be allowed to keep in order to qualify for Medicaid. The basic concept of the Partnership Program is that one purchases a partnership policy, and then when they use it and, then at a later date need to apply for Medicaid, the person may retain one dollar for every dollar actually paid out under their policy, and those funds also will not be subject to Medicaid estate recovery after death. In other words, the amount of assets Medicaid will "disregard" is equal to the amount of benefits one actually has received under their long term care partnership policy prior to applying for Medicaid. Kentucky's Partnership Program will allow conversion of existing long term care policies to partnership policies as long as certain requirements are met. Generally, it is recommended that a policyholder convert to a partnership policy, if given the option to do so. Before a decision to purchase any long term care insurance is reached, there needs to be a careful analysis of multiple factors, beyond the person's age and health, including the person's assets, expected sources of income and the expected daily cost of care when it is needed. It may be appropriate to purchase a limited period of coverage, such as for a period of three (3) to five (5) years as part of an overall plan for care. VETERAN'S BENEFITS There are numerous VA programs and benefits available to veterans and their family members that can help cover the cost of long-term care. This article will focus on VA healthcare, but will also mention or briefly touch other benefits and programs.6 The first program to discuss is VA health care. To be eligible for VA health care benefits generally the veteran must be enrolled in the VA health system, unless they meet certain requirements relating to VA disability or VA pension benefits. Aside from the traditional health care coverage one thinks of, VA health benefits can include Adult Day Health Care, which is an outpatient day program for veterans needing assistance with ADLs. Respite Care is a program that provides short term services to the veteran, in order to give a caregiver time off from B&B; • 05.13 23 Medicare, but who are over age 65, may purchase coverage by paying a monthly premium. 4