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Hearing focuses on Medicaid health-care 'penalty' rules

July 11, 2006|by KAREN HANNA

HAGERSTOWN - At a hearing Monday on Medicaid changes, a 67-year-old Boonsboro man said he had heard that new rules would penalize older Americans who give away some of their wealth before requiring medical care.

For Bob Sweeney, speakers' arguments in favor of long-term health-care insurance made sense, though he admitted that he is not shopping for a policy.

"No, we haven't worried about that. The time comes, you go," Sweeney said, as he and his wife, Sara, left a panel discussion about changes to Medicaid rules.

According to U.S. Rep. Roscoe Bartlett, R-Md., the vice chairman of the hearing, some people have tried to cheat the system by spending down their wealth, making themselves "artificially impoverished" to qualify for Medicaid funding for services they might otherwise be able to afford.

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The program costs $300 billion and is increasing 8 percent every year, Bartlett said.

"Clearly, this will just consume us if it continues. Right now, it is just increasing a debt that we pass on to our kids and our grandkids," said Bartlett, 80. He said he believes the explosive increase would be contained if insurance companies included long-term care benefits in their policies.

"If that was an invariable part of the health-care plan, it would cost literally pennies," he said.

According to information provided by Stephen A. Moses, president of the Center for Long-Term Care Reform Inc., the Deficit Reduction Act of 2005 closed some of the loopholes by extending to five years a "look back" at asset transfers. People who transfer assets at less than their market value for the purpose of qualifying for Medicaid can incur penalties and delays in getting benefits.

People who have made a practice of giving money to charities or family members would not be penalized, and nobody would be denied essential care, Bartlett said.

Bartlett said he is concerned that the people who most need help would not get services if Medicaid is not reformed.

A Bartlett opponent and a woman who said she was representing a candidate for U.S. Congress both criticized Bartlett's assertions that private insurance coverage would hold down Medicaid costs.

"What they're doing is chipping around the edges instead of dealing with the real meat of the problem," said Andrew Duck, a Democratic contender for Bartlett's job.

Duck said the country is facing a "health-care crisis."

Maldo Schmidt, who is coordinating Democrat Barry Kissin's campaign for the Sixth District, said including long-term care coverage in insurance policies would only increase the number of uninsured Americans. She said Kissin supports single-payer national health-care coverage.

Bartlett said he has met senior citizens who are depressed that their health-care costs will drain their estates, making it impossible for them to leave anything to their heirs. If they had long-term care coverage, they would have been able to support themselves and leave an inheritance, he said.

"I have talked to a lot of seniors. They worked hard all their lives, and they love their kids and grandkids, and they wanted to pass their home down to them, and now it is being consumed by them being in a nursing home," Bartlett said.

The reforms will not help them, but the new rules will encourage younger people to better prepare for their future health costs, Bartlett said.




Rules prevent hiding assets


According to information provided by Stephen A. Mose, president of the Center for Long-Term Care Reform Inc., in Seattle, the Deficit Reduction Act of 2005 included new rules to prevent people from trying to hide their assets to qualify for Medicaid benefits.

The law extends from three years to five years a "look back" at asset transfers when considering a person's Medicaid eligibility. Mose said he supports a window of at least eight years - the average amount of time between onset of Alzheimer's disease and death.

The rules provide for penalties for people who have transferred funds at less than their market value for the purpose of qualifying for Medicaid. Under the 2005 changes, the penalties begin when the person involved applies for Medicaid services. If a penalty would deny medical care, food, shelter or other essentials, the applicant or nursing-care facility can apply for a waiver.

Gifts to families and charities are allowable under the law.

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