Affordable Care Act Question

@Peter Frouman,

Peter Frouman wrote:

You stated that "[e]very time someone on Medicaid dies, the state seizes all their assets" and that "if you sign up for Medicaid, the government takes all your assets when you die." As I correctly pointed out, those statements are false.

Pretty much every person who signs up for Medicaid is going to have all their assets seized when they die.

There might be some rare exceptions, but for the most part the lower middle class in America is on the verge of annihilation.

Right now the lower middle class might be poor, but a lot of them do own their own home. A generation from now, hardly any of them will be homeowners.

Peter Frouman wrote:

Insurance companies will continue to sell plans outside the exchanges. In fact, most Americans will continue to be covered by plans purchased outside the exchanges and anyone will be able to purchase an insurance policy outside the exchange if there is an insurer willing to sell it to them and they are willing to buy it. If someone wants to avoid the exchanges completely (even when it might not always make sense for them to do so), there will be plenty of other options including purchasing a policy outside the exchange. Don't believe me? Perhaps you'll consider a few of the many other reliable sources that state the same thing. Here are a few examples:

Quote:
Many insurers will offer individual policies outside the Obamacare exchanges in 2014. Consumers can avoid the exchanges by buying plans directly from insurers or through brokers.

Source: http://money.cnn.com/2013/09/05/news/economy/obamacare-exchanges/index.html
Quote:
6. Will people still be able to buy insurance outside of the HIE?

The HIE is not intended to compete with the existing insurance marketplace. Insurers can sell
policies outside of the Exchange; consumers and employers can purchase coverage outside of the
Exchange.

Source: http://gov.idaho.gov/pdf/12-11-2012,HIE%20FAQ.pdf
Quote:
Individuals and businesses may purchase insurance both in and outside the exchange and are not required to purchase in the exchange; however, many are expected to choose the exchange to take advantage of subsidies and tax credits.

Source: http://www.bakerdonelson.com/health-insurance-exchanges-in-ppaca-06-17-2010/

This is interesting, but let's see if it actually happens. Right now all I hear is a lot of people saying that their individual plans have been cancelled. I don't hear anyone talking about being offered replacement plans outside the exchange.

2 Replies

@oralloy,

oralloy wrote:

Pretty much every person who signs up for Medicaid is going to have all their assets seized when they die.

A more accurate statement would be: "Less than 6% of Medicaid beneficiaries may have some of their assets seized when they die."

Less than 6% of people signed up for Medicaid is certainly nowhere close to "[p]retty much every person who signs up for Medicaid."

Medicaid estate recovery applies only to those who have received long-term care services funded by Medicaid or those who received certain types of Medicaid funded services or reimbursements on or after their 55th birthday. Nearly all Medicaid estate recovery collections are for long-term care services and thus the number of Medicaid beneficiaries receiving long-term care services is a reliable indicator of the number of Medicaid beneficiaries whose estates may be subject to MERP collection action. In 2010, there were 66,425,538 people signed up for Medicaid and about 3,800,000 of those people received long-term care services funded by Medicaid. As is evident, only a very small percentage (currently less than 6%) of all people who enroll in Medicaid in a given year could possibly have their estates subject to Medicaid estate recovery collection action as a result of that enrollment. Furthermore, Medicaid estate recovery is subject to a complex set of laws, regulations, policies and practices that vary significantly from state to state. All states exempt certain amounts and categories of assets from Medicaid estate recovery.

Some more information on Medicaid Estate Recovery Programs (MERP) can be found at the following links:

http://aspe.hhs.gov/daltcp/reports/estaterec.htm
Texas: http://www.dads.state.tx.us/services/estate_recovery/
California: http://www.dhcs.ca.gov/services/Pages/FederalandStateLawsGoverningEstateRecovery.aspx
Georgia: http://dch.georgia.gov/medicaid-estate-recovery

http://longtermcare.gov/ is also a good resource for general information on long-term care planning.

Medicare and most (if not all) health insurance policies provide very limited or no coverage for the types of services that are the primary focus of state Medicaid estate recovery programs.

Someone who is eligible for Medicaid and concerned about Medicaid estate recovery should consider getting a long-term care insurance policy as well as seeking professional legal advice to devise a plan to shelter any assets they may have. Long-term care insurance policies do have limits on benefits but in some states those who have purchased such policies and then received Medicaid funded services after exhausting their benefits will have more of their assets exempted from Medicaid estate recovery.

2 Replies

@Peter Frouman,

Peter Frouman wrote:

Medicaid estate recovery applies only to those who have received long-term care services funded by Medicaid or those who received certain types of Medicaid funded services or reimbursements on or after their 55th birthday.

I think it's likely that a good number of poor people will live to reach age 55.

And "certain" types of services means any Medicaid service that a state legislature authorizes as falling under their estate recovery program.

Peter Frouman wrote:

Nearly all Medicaid estate recovery collections are for long-term care services

I doubt that. And I expect the problem will grow worse as Medicaid is expanded to cover people who have slightly more money.

But it won't be my house that gets seized, and none of the victims will be able to say I didn't warn them.

Meanwhile I've now looked over a sample of what the exchange offers and I'm not too impressed, but maybe that complaint will be a better fit over on Glitchgov's thread.

0 Replies

@footballman,

Just a few points to clarify for my answer: you want to keep the plan you have at the price you are paying; when the Affordable Healthcare Act goes into effect, your plan cost will go up, is my understanding. Unfortunately, the price of health insurance is always going up, for many reasons and the insurance company being forced to cover more preventative services and benefits is just a part of that. If you bought your plan before ACA was made into law (March 23,2010) it could be grandfathered in, i.e. does not have to comply with the law. If this could be the case for you, check with your agent and tell him/her about your concerns.

0 Replies

@oralloy,

oralloy wrote:

Peter Frouman wrote:
Insurance companies will continue to sell plans outside the exchanges. In fact, most Americans will continue to be covered by plans purchased outside the exchanges and anyone will be able to purchase an insurance policy outside the exchange if there is an insurer willing to sell it to them and they are willing to buy it. If someone wants to avoid the exchanges completely (even when it might not always make sense for them to do so), there will be plenty of other options including purchasing a policy outside the exchange. Don't believe me? Perhaps you'll consider a few of the many other reliable sources that state the same thing. Here are a few examples:

Quote:
Many insurers will offer individual policies outside the Obamacare exchanges in 2014. Consumers can avoid the exchanges by buying plans directly from insurers or through brokers.

Source: http://money.cnn.com/2013/09/05/news/economy/obamacare-exchanges/index.html
Quote:
6. Will people still be able to buy insurance outside of the HIE?

The HIE is not intended to compete with the existing insurance marketplace. Insurers can sell
policies outside of the Exchange; consumers and employers can purchase coverage outside of the
Exchange.

Source: http://gov.idaho.gov/pdf/12-11-2012,HIE%20FAQ.pdf
Quote:
Individuals and businesses may purchase insurance both in and outside the exchange and are not required to purchase in the exchange; however, many are expected to choose the exchange to take advantage of subsidies and tax credits.

Source: http://www.bakerdonelson.com/health-insurance-exchanges-in-ppaca-06-17-2010/

This is interesting, but let's see if it actually happens. Right now all I hear is a lot of people saying that their individual plans have been cancelled. I don't hear anyone talking about being offered replacement plans outside the exchange.

OK, I concede that you are right on that one. People who are denied access to the exchange because they are "not rich enough" can still buy the same plans directly from the insurance companies.

This was on the PBS NewsHour last week:

Quote:

GWEN IFILL: But what happens if you lose your -- if you lose -- you get your a cancellation notice today, and you want to go online to get the new insurance, but you can't because of the problems with the system, with the website, and you are not covered in January or whenever this kicks in?

JONATHAN GRUBER: Well, I completely agree that's a problem if the website not working by the end of November.

You don't have to sign up today to be covered by January. It's nice to be able to shop today, but you need to be signed up by mid-December. So, if the website is not working by the end of January, then I think that is an issue.

(CROSSTALK)

ROBERT LASZEWSKI: This is a huge issue, and I would just...

(CROSSTALK)

GWEN IFILL: Mr. Laszewski, go ahead.

ROBERT LASZEWSKI: To just help your audience, any of the people who have gotten the cancellation letters, I have renewed my policy by calling my insurance company directly and doing it and going around the site.

Now, the bad news is, I really wasn't able to shop because I went to one carrier. And the other thing is, if I need subsidies, I can't get a subsidy from my carrier because they can't get into the subsidy system either. But, as a fallback temporarily, I would encourage people to call their incumbent carrier and get the best situation they can, so they don't have a lapse in coverage.

http://www.pbs.org/newshour/bb/government_programs/july-dec13/healthcare_10-29.html

0 Replies

@Peter Frouman,

"Someone who is eligible for Medicaid and concerned about Medicaid estate recovery should consider getting a long-term care insurance policy as well as seeking professional legal advice to devise a plan to shelter any assets they may have".

I'm a bit confused by this response. If a person is eligible for Medicaid, why would you expect that individual to have a significant "estate" or even any "estate" at all?

Along the same lines, if a person is poor enough to be on medicaid, how could they possibly afford to buy and pay for a long-term insurance policy?

I thought that only those with limited income and assets could qualify for medicaid.

INTERNET: For Medicaid... "Currently, your income has to be at 100% of the poverty level. In the next few months, that percentage will increase to 133% of the poverty level".

Medicaid qualification is based on current income, and has nothing to do with net assets ( which could be easily converted to cash if necessary ). Thus, you could look very poor on paper, and yet be very, very wealthy...

2 Replies

@Miller,

I've answered one of my own questions.

A individual, poor enough to be on Medicaid, may still have assets ( non-cash) which may be seized upon death ( if the Government knows about these assets).

0 Replies

@footballman,

I have two problems with the original post.

1. Any plan that costs $92/month, even for a young healthy person, is not going to cover very much. That is a ridiculously low price. This sounds like one of those garbage plans that the ACA now prohibits. The claim that it is the "exact same plan" sounds a little fishy to me.

2. The point about not wanting government assistance is ridiculous. If the poster drives on roads, counts on police to help him when he needs it, attended public schools or uses the Internet, he is using government assistance.

Insurance is a pool. Everyone pays into it, and then you take out of it when you need it. It works the same under Obamacare that it did before (accept now it is a little more helpful to people making $20,500 a year).

Just take the damn subsidy! I am not eligible for the subsidy.. in fact I pay the taxes that will pay for your subsidy. I don't mind at all because if you have insurance then I don't have to pay for you emergency room visits.

It is better for all of us if you just take the subsidy and stop bellyaching about it.

1 Reply

@maxdancona,

I'd really like to see the cheap policies people reference here (and elsewhere). The ones I've been able to look at have had crap coverage and exclusions out the wazoo.

0 Replies

@Miller,

While the ACA eliminated Medicaid asset tests for some people, there are still many groups still subject to asset tests and limits. This includes the elderly (the group most likely to use the long-term care services that consume the bulk of Medicaid's funding) and those in states that have rejected the ACA Medicaid expansion.

Medicaid planning is a rapidly growing part of elder law legal practices and there is a huge group of lawyers, accountants, financial planners, insurance companies and financial institutions that offer a broad array of products and services designed to protect and shelter assets (often to preserve them not only for the benefit of their heirs but for their surviving spouse) and maximize eligibility and use of Medicaid long-term care services. In some cases, those who need and use these type of services are very wealthy and their Medicaid planning starts long before they enroll in Medicaid or need its long-term care service benefits. Just like tax and estate planning, Medicaid planning is very complex and constantly evolving in response to legal and regulatory changes and challenges.

0 Replies

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