Patient Liability Change
Temporary Suspension of Patient Liability Increases
Under normal Medicaid rules, certain members must pay a monthly patient liability to their nursing home for their long-term care. In response to the COVID-19 pandemic, the Wisconsin Department of Health Services (DHS) temporarily changed Medicaid program rules to suspend patient liability increases from April 2020 through January 2021. The temporary change is based on provisions in the federal Families First Coronavirus Response Act.
As a result of the change, one of the following applies to members subject to paying a patient liability:
- From April 2020 through January 2021, they paid the lowest patient liability calculated for them since April 1, 2020.
- They did not have any patient liability from April 2020 through January 2021.
Whether or not members had a patient liability was based on when they were enrolled in a program and when they became subject to paying patient liability.
Reinstatement of Increases
Starting February 1, 2021, DHS is reinstating normal Medicaid rules for patient liability calculations and increases. As a result, members subject to a patient liability may have an increased or newly established patient liability. The purpose of this reinstatement is to minimize disruption to enrollment at the end of the public health emergency. As detailed below, members who have a reduced patient liability may accumulate assets that can put them over the program’s asset limit.
Members will be sent a letter the week of December 28, 2020, as notification of the suspension and reinstatement of patient liability increases:
In mid-January 2021, members who will have an increased or newly established patient liability starting in February 2021 will be sent another letter titled “About Your Benefits” indicating the amount they must pay.
Member Refunds
Members who were newly subject to patient liability or had an increase in patient liability on or after April 1, 2020, and have already paid the amount, must be refunded. Nursing homes must refund members within 30 days of their Medicaid claim being reprocessed. DHS will be providing nursing homes with a report that identifies impacted members.
Member Impacts
Asset Limit Considerations
Since patient liability increases were suspended from April 2020 through January 2021, members may accumulate additional monthly income that would have been paid toward their monthly patient liability. This may cause some members to go over the Medicaid asset limit. For Medicaid, income is considered an asset if members have not spent the income by the month after they received it. To be eligible for Medicaid, members must have assets within the Medicaid asset limit.
As a reminder, Medicaid rules have been temporarily changed so members do not lose eligibility during the federal public health emergency unless they move out of state or ask to be disenrolled.
To remain eligible for Medicaid after the public health emergency ends, members need to spend the additional monthly income to be within the Medicaid asset limit by that time. If they do not, they will be disenrolled from Medicaid after the public health emergency ends and will need to pay for their long-term care services privately until they spend enough assets to be within the Medicaid asset limit. Once their assets are within the Medicaid asset limit, they can reapply for Medicaid.
For patient liability refunds only, members have nine months to spend the refund before it is counted as an asset.
Member Options
To keep from going over the Medicaid asset limit before the public health emergency ends, members may be able to do the following, depending on their situation:
- Give the additional income to their spouse.
- Buy things they need for themselves or their home.
- If they are younger than age 55, make a payment to Medicaid. To do this, members should contact their income maintenance or tribal agency.
- If they are age 55 or older, make a voluntary recovery payment to the Estate Recovery Program. To do this, members should contact their income maintenance or tribal agency.
Members are encouraged to consult with an attorney or financial planner about these and other options, such as putting the additional income in a special trust or account. The options available to them are dependent on their age and whether or not they have a disability determination.
Members do need to be careful to not spend the income in a way that would be considered divestment. One form of divestment is giving away or transferring income and/or assets without receiving that same value in return. As an example, it would be considered divestment if a member were to gift the additional income to their grandchild.
If members spend the income in a way considered to be divestment, they are subject to a divestment penalty period after the public health emergency ends. During the divestment penalty period, members who live in a nursing home would need to pay for their long-term care services privately. Medicaid will cover other services, such as health care services, that do not include long-term care.
Nursing Home Obligation
Nursing homes must proactively address potential eligibility impacts with residents or their representatives, orally and in writing, in a language that the resident or resident representative understands.
Nursing homes are encouraged to assist residents in staying under the Medicaid asset limit by purchasing items that the member needs.
Resources
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Aging and disability resource centers. Members can be directed to their local aging and disability resource center to discuss their long-term care options and to receive assistance applying or reapplying for Medicaid.
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Income maintenance or tribal agencies. Members can be directed to their income maintenance or tribal agency for reporting changes in assets, assistance with applying or reapplying for Medicaid, making payments to Medicaid or the Estate Recovery Program, or other eligibility-related questions.
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Divestment information.
- COVID-19:
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