It is often seen that the Medicare policy that you are having does not cover for the total bill charged for your medical treatment. Therefore it is a big concern to pay the extra bill that is not covered by the original Medicare policy. To bear the extra cost is not easy. For this reason the supplementary policy has been introduced in order to overcome the cost. This policy is stated as Medicare supplementary policy. It is also known as Medigap plan or policy. Medigap is something that fills up the gap between the original Medicare policy and the supplementary policy. The expenditure which is not paid by the original is paid by this Medigap plan. It helps you to get relieved of that extra burden of medical cost. The fact is that in the original Medicare policies there always remain several gaps for which it doesn’t pay for all the health care services that you may need. Therefore if you are the one of the beneficiaries of the original Medicare plane, you may be in the need to buy Medicare supplement insurance. Now you can understand the reason why it is called Medigap plan. This health insurance policy helps you to pay for some of the costs in the original Medicare program and also for the part that it doesn’t cover.

This policy had been standardized by Centers of Medicare and Medicaid Services (CMS) in 1992. But it is not that this policy was not present before that. It was present prior that but prior 1992 the policy holders under this scheme remains under non-standardized plan. And those plans are now no longer applicable for the newly introduced plans. It is to be mentioned that the Medigap or the Medicare supplement plans are sold by the private insurance companies and there are no government sponsorship behind them. And for that reason the insurance policies may vary from state to state. According to the law, the companies can offer only 12 Medicare supplement insurance plans. All these plans are named after the letter series of English alphabet. From A to L, all these plans are for separate benefits. You have to go through all the plans carefully and then decide what the plan is you are opted for. In 2006 it has been clearly stated that the Medigap Plans H, I, and J, cannot be sold to people with prescription to drug benefits, although there is a lax of this rule for people who already have those plans and they can keep them.

The insurance company can not change its scheme or any thing under its policy rules unless you become a defaulter. Any irregularity in your premium giving and other thins can be measured as default. So be careful about paying the premiums within the time period. However, the company can increase the insurance premium, but that too they can’t do without providing your prior notice of the increase in due time.

However, it is sure that if you are under a Medicare policy and have a Medicare supplement plan along with it you need not have to worry about the Medical costs that you may have to face any time in life.

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MEDICAID MORATORIA

Sec. 5003 – Extends or creates moratoria – through June 30, 2009 – on four Medicaid regulations for the following: 1) outpatient hospital and clinic services, 2) targeted case management, 3) provider taxes, and 4) school-based administration and transportation services. Congress also included a Sense of Congress that the Secretary of Health and Human Services should not promulgate three regulations concerning rehabilitative services, intergovernmental transfers, and Graduate Medical Education. It is hoped that this action will result in the Administration repealing these draft regulations.

FEDERAL MEDICAL ASSISTANCE PERCENTAGE

Sec. 5001 provides for an $87 billion increase to the Medical Assistance Percentage (FMAP) over the next two years (Oct. 1, 2008-Dec. 31, 2010). All states will receive an increase in their FMAP by 6.2 percentage points. In addition, some states are eligible to receive additional ?hold harmless’ and unemployment-related FMAP increases. This means that a state’s FMAP rate is equal to its current FMAP rate, plus a 6.2% base increase and ?hold harmless’ and unemployment adjustments (see below). Lastly, the FMAP increase includes ?prompt pay’ requirements and a maintenance of effort clause, which is applicable for the next two years.

>>The first two quarters of the new funding for FY 2009 (approximately $15.2 billion) was released February 25th by the U.S. Department of Health and Human Services. See map on DHHS site for allocations for each state.
Scope of Application

>>This increase applies to Medicaid, Foster Care, and Adoption Assistance

>>This increase does not apply to: 1) Temporary Assistance to Needy Families (TANF), 2) child welfare, 3) child support enforcement, 4) State Children’s Health Insurance (SCHIP), 5) Disproportionate Share Hospital (DSH) Payments, 6) items/services subject to an enhanced match, 7) individuals who become eligible as a result of income eligibility standards (expressed as a percentage of the poverty line) that are higher than those that were in effect on July 1, 2008, including standards that were proposed to be in effect under enacted state law that was not effective on July 1, 2008 or a state plan amendment or waiver request that was pending approval as of that date.

>>>In these cases, the regular state FMAP applies.

HOLD HARMLESS

>>States that would otherwise experience a drop in their federal medical assistance percentages (FMAPs) under the normal FMAP formula would be held harmless against any decline.

>>In FY09: If a state’s FY09 FMAP is less than its FY08 FMAP, the FMAP increase will be added to the FY08 FMAP. So, if a state has an FY08 FMAP of 60% and an FY09 FMAP of 58%, the 6.2% increase via the ARRA will be applied to the FY08 rate.

>>In FY10: If a state’s FY10 FMAP is less than either the levels in FY08 or FY09, the FMAP increase in FY10 will be applied to the greater of the FMAP levels for FY08 and FY09. So, if a state has an FY08 FMAP of 60%, an FY09 FMAP of 58%, and an FY10 FMAP of 59%, the 6.2% increase via the ARRA will be applied to the FY08 rate.

>>For the 1st calendar quarter of FY11(through Dec. 31, 2010): If a state’s FY11 is less than the FMAP for FY08, FY09 or FY10, the FMAP increase for the first calendar quarter of FY 2011 will be applied to the greater of the FMAP level of the previous fiscal years. So, if a state has an FY08 FMAP of 60%, an FY09 FMAP of 58%, an FY10 FMAP of 59%, and an FY11 FMAP of 57%, the 6.2% increase via the ARRA will be applied to the FY08 rate.

UNEMPLOYMENT

>>$30.45 billion of the $87 billion is reserved for the unemployment provision based upon a formula for each state’s unemployment rate during the current economic recession. Under this formula, the FMAP increase and the unemployment bonus are weighted on a 65% (FMAP increase) and 35% (unemployment bonus). See the initial 2009-2011 projections for individual states.

MAINTENANCE OF EFFORT

>>A state will be ineligible for the FMAP increase if eligibility standards, methodologies, or procedures under the Medicaid state plan (including Medicaid and/or Section 1115 waivers) are more restrictive than the eligibility standards, methodologies or procedures under the state plan or waiver that was in effect on July 1, 2008 (see “Special Rule” below for exceptions).

>>States retain the flexibility to make changes in benefits and reimbursement.

>>State Reinstatement of Eligibility Permitted: A state that has restricted eligibility standards, methodologies, or procedures after July 1, 2008, will become eligible for the FMAP increase beginning with the first calendar quarter in which the state has reinstated eligibility standards, methodologies and procedures that are no more restrictive than those that were in effect on July 1, 2008.

>>>Special Rule: A state will not be ineligible for the increased FMAP under the following circumstances: 1) on the basis of a restriction that was     applied after July 1, 2008 and before the date of enactment of the ARRA and 2) on the basis of a restriction that was effective under state law as of     July 1, 2008, and would have been in effect as of that date if it weren’t for a delay (of no more than one calendar quarter) in the approval of a     request for a new waiver under section 1115 with respect to the restriction.

PROMPT PAY

>>Requires states to report monthly to HHS on the states’ compliance with the Medicaid prompt pay requirements in Medicaid Statute (42 U.S.C. 1396a(a)(37)(A)), which specifies that the state must pay 90% of clean claims within 30 days of the date of receipt of the claims and that 99% of claims are paid within 90 days of the date of receipt. States must also provide for procedures of prepayment and post-payment claims review, including review of appropriate data with respect to the recipient and provider of a service and the nature of the service for which payment is claimed, to ensure the proper and efficient payment of claims and management of the program.

>>Existing prompt payment provisions apply to practitioners, in individual or group practice, and the ARRA amendment extends its application to nursing facilities and hospitals.

>>Prevents a state from receiving the increased FMAP claims received by the state for days during any period when the state is out of compliance with the Medicaid prompt pay requirements.

>>Permits the Secretary to waive this requirement during any period in which there are exigent circumstances – including natural disasters – that prevent the timely processing of claims or the submission of required compliance reports.

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Charity care is a term used in the United States to refer to health care services rendered to patients unable to pay for some, in whole or in part.

More specifically, the term refers to a scheme used by the state of New Jersey to provide reimbursements to hospitals and other health-care institutions which provide uncompensated or undercompensated health care to patients lacking private health insurance whose income falls below a certain amount but is too high to qualify them for Medicaid and are not old enough to be eligible for Medicare (New Jersey’s situation is somewhat unique among American states in that the state has no county or municipal hospitals).

The scheme provides free health care to uninsured state residents whose income is up to 200% of the federally-designated poverty line, and provides discounts which gradually phase out at incomes between 200% and 300% of the poverty line; the patient’s liquid assets (not including the patient’s home and one automobile) must not exceed $7,500. Also, the maximum any individual qualifying for aid under the aforementioned criteria can be liable for in a single year is 30% of that patient’s gross income for that year. A special fund compensates the health-care provider – which may have furnished either inpatient or outpatient services – for the applicable difference in cost.

Some private health-care providers in other states – particularly those that are operated on a nonprofit basis (often by religious entities) – also provide free and/or low-cost health care to uninsured patients, using income thresholds similar to those observed statewide in New Jersey; but state laws vary widely as to how much, if any, reimbursement (usually in the form of tax credits) the institution receives for so doing (and in only one other state besides New Jersey – Washington – does an outright mandate exist to provide charity care). Perhaps the most famous example of such an institution is the Charity Hospital of New Orleans, founded in 1732 and now run by the Medical Center of Louisiana.

Many political moderates in the United States point to the success of the New Jersey program, and recommend its adoption at the federal level as an alternative to national health-insurance proposals advocated by many liberals, which conservatives pejoratively characterize as “socialized medicine”.

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Transfer of Assets in Medicaid Planning

There is a period of non-eligibility for Medicaid for those who have recently transferred assets. The DRA was enacted in 2006. For transfers that were made prior to the enactment, Medicaid officials will only look at any transfers that were made within 36 months of the Medicaid application. If transfers were made after the enactment of the DRA, there is a look-back period of 60 months. This period determines how long you must wait to become eligible for Medicaid after the transfer was made. The formula is based on the amount that was transferred. It takes the total amount transferred and divides it by the average monthly cost of nursing care. For example, if $100,000 was transferred and the nursing costs are $5,000 per month, the waiting period, or penalty period would be 20 months. There is another rule that is involved with the look-back period. The penalty period will not begin until the individual has moved to the nursing home, has spent down their assets to be eligible for Medicaid, has applied for coverage and has been approved for the coverage but not for the transfer.

When making transfers, it is very important to be aware of these rules and time frames. This information will help you better plan your Medicaid asset protection. Make sure that all transfers are done prior to the time of needing nursing care. It is suggested that if you are considering transferring your assets, you do so as soon as possible. This will eliminate any waiting when Medicaid coverage is needed. If transfers are made within the five year look-back period, the penalty time could actually extend past five years. This will depend on the amount of assets that were transferred.

There are many factors to consider when making transfers. You should take into consideration the estimated cost of nursing care you will need, the transfer penalty in the state in which you reside, your current and projected income and other living expenses. The main goal of the DRA was to try to eliminate any planning. The best solution is to contact an elder law expert or contact us UltraTrust.com (Estate Street Partners) to assist you with Medicaid planning and asset protection transfers.

You should also be aware that transfers could have tax consequences if not done correctly. If you transfer the assets to your children, they will be responsible for all taxes. If the value of the asset appreciates, there could be serious consequences. Your children will not receive the tax break that they would if they had received the assets through your estate. This is another reason why it is so important to carefully plan any transfers.

Another common concern is how to handle owning a home. It is possible for an individual to be in a nursing home, receive Medicaid and still own a home. However, it is much easier to transfer the home to a spouse that will not be in the nursing home or even better, an irrevocable trust. Transferring it to a spouse allows the spouse to have complete control over the asset and will allow him or her to sell the property after Medicaid has been approved for the other spouse. At this point, it is wise for the spouse to change their will, removing the nursing home spouse. This will protect the assets. Otherwise, if the spouse dies, all of the assets will go to the spouse in the nursing home. This may affect Medicaid eligibility and will force a spend-down of assets to maintain Medicaid benefits. Contact us at UltraTrust.com for further expert advice and consultation on these matters.

There are certain transfers that are exempt from the look-back period. After going into a nursing home, it is possible to transfer assets to your spouse, a child who is disabled or into a trust for the benefit of someone under the age of 65 with a permanent disability. You may also transfer your home to children under the age of 21, to a child that resided in the home for two years prior to you being placed in a nursing home or a sibling that has an equity interest in the home. The sibling must have lived in the home for one year prior to you entering the nursing home. These types of transfers are allowed and there will be no penalty regarding Medicaid eligibility.

If you have any concerns about how to transfer assets or if a transfer is your best option, contact an asset protection expert or contact us Ultratrust.com  (Estate Street Partners). They will have all the information you will need to make an informed decision. Keep in mind that transferring assets sometimes means you lose control of those assets. In rare cases, it is better to spend your own savings and wait to apply for Medicaid benefits until the transfers are all in place. Again please consult an expert.

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If you have an original Medicare plan and you are thinking that you are completely secured then you are thinking the wrong. The reason is your original Medicare plan does not cover the total expenditure of your health purpose. Some expenditure always left over by your original Medicare policy. It mainly concerns about the expenditure that you have spent over your health solely. But other spending of money such as transportation, medicine, and other subsidiary things are not covered and included in the main list provided by the original Medicare norms. Therefore you need something more which will help you to provide you with your all necessary requirements that are important fir your treatment if you have any. Now you can have all the benefits if you are applied for a Medigap policy which is introduced only for helping you to have all the benefits of your original Medicare policy. So it can be described as a bridge between the Medicare and Medicare supplementary policy which is covered or can be said joined by Medicare supplementary plan. This is for the people who are already beneficiary to original Medicare plan. It was started in the year 1992 and it is under the private organization. No government authorization associated with this policy. Though several companies are having the right to sell the policy but they have to obey the rules which are same for all.

This policy had been standardized by Centers of Medicare and Medicaid Services (CMS) in 1992. But it is not that this policy was not present before that. It was present prior that but prior 1992 the policy holders under this scheme remains under non-standardized plan. And those plans are now no longer applicable for the newly introduced plans. It is to be mentioned that the Medigap or the Medicare supplement plans are sold by the private insurance companies and there are no government sponsorship behind them. And for that reason the insurance policies may vary from state to state. According to the law, the companies can offer only 12 Medicare supplement insurance plans. All these plans are named after the letter series of English alphabet. From A to L, all these plans are for separate benefits. You have to go through all the plans carefully and then decide what the plan is you are opted for. In 2006 it has been clearly stated that the Medigap Plans H, I, and J, cannot be sold to people with prescription to drug benefits, although there is a lax of this rule for people who already have those plans and they can keep them.

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