Navigating the complexities of long-term care can be overwhelming. For residents of Arizona, the Arizona Long Term Care System (ALTCS) offers one method to pay for the cost of long-term care for individuals without the means to privately pay for it. This article provides a comprehensive guide to understanding ALTCS, its benefits, and the steps to apply for it.
What is ALTCS?
The Arizona Long Term Care System (ALTCS) is part of Arizona’s Medicaid program. It is designed to provide health care and support services to individuals who need long-term care. ALTCS covers a variety of care services including those provided in a nursing home, assisted living facility, or in-home care.
ALTCS Coverage
What Does ALTCS Pay For?
ALTCS covers a wide range of services including nursing home care, in-home care, and services provided at an assisted living facility. The coverage also includes medical care, therapy services, and care to help with activities of daily living (ADLs) such as bathing, dressing, and eating. See the ALTCS handbook for more information.
Will ALTCS Decide Where I Will Live?
ALTCS allows individuals to receive care in various settings based on their needs. ALTCS does not necessarily decide on where you will live, but they do not provide coverage for all facilities or in home situations. While some may require the comprehensive care provided in a nursing home, others may receive adequate support in an assisted living facility or through in-home elder care.
If I Receive ALTCS, Will the State Take Over My Social Security and Pension?
No, receiving ALTCS benefits does not mean the state will take over your social security and pension. However, a portion of your monthly income may be allocated to cover part of your care expenses. In addition, you need to be under a certain income threshold in order to receive benefits.
How Much Will I Have to Pay for My Care While on ALTCS?
The amount you will pay depends on your income and assets. ALTCS may require a share of cost, which is the amount you contribute toward your care expenses based on your financial situation.
Qualifying for ALTCS
Who Qualifies for ALTCS Benefits?
To qualify for ALTCS, individuals must meet medical and financial eligibility requirements. This includes needing a nursing home level of care and meeting income and asset limits set by the state of Arizona.
- Elderly (65 or older), blind, or disabled;
- U.S. Citizen or lawful resident alien;
- Reside in Arizona;
- Must apply for all other potential benefits, such as pensions or VA benefits, and;
- If not at home, reside at an ALTCS participating living arrangement.
What is the Medical Criteria?
Elderly or disabled applicants must be at risk of institutionalization and require substantial assistance with activities of daily living (ADLs). Medical eligibility is determined by a pre-admission screening (PAS) conducted by AHCCCS. The PAS includes both a functional and medical assessment, focusing primarily on the applicant’s ability to perform ADLs such as mobility, transferring, toileting, dressing, feeding, bathing, and grooming.
Additionally, the assessment evaluates the applicant’s medical diagnoses, sensory function, orientation, emotional and cognitive behavior, and the medical services and treatments they require. Typically, individuals who meet ALTCS medical criteria often present with a combination of the following needs or impairments:
- Require skilled nursing care
- Require regular medical monitoring
- Need prompting, supervision, or hands-on assistance with ADLs due to cognitive impairments (e.g., Alzheimer’s disease or dementia) or physical disabilities
- Unable to perform two or more ADL’s
- Have psychosocial deficits
These factors collectively determine the applicant’s eligibility for ALTCS based on their need for substantial and ongoing care.
What are the Financial Requirements?
ALTCS applicants must meet both the income and resource criteria, which vary depending on marital status.
Income Criteria (2024)
- Single Persons: Qualify if gross monthly income is less than $2,829.
- Married Persons: Qualify if the applicant spouse’s gross monthly income is less than $2,829, or if both spouses’ combined gross monthly income is less than $5,658.
What if the income exceeds these limits? Applicants may still qualify by establishing and properly using an Income Only Trust, also known as a Miller Trust. If you need an Income Only Trust, call us for assistance.
Resource Criteria (2024)
Countable Assets: These generally include bank accounts, investment and retirement accounts, life insurance (cash value), stocks, bonds, cash on hand, and real property or land that is not the applicant’s primary residence. In other words, it’s everything you own that isn’t excluded.
- Single Applicants: Cannot have more than $2,000 in countable resources to qualify for ALTCS.
- Married Couples: The rules are more complex. When one spouse will be institutionalized, all countable assets are added together (regardless of ownership) as of the first month the applicant spouse met medical criteria. This total is then divided in half, which is the allowable Community Spouse Resource Assessment (CSRA). The CSRA may not exceed $154,140 or be below $30,828. In addition to the half that the community spouse may retain, the applicant may also retain $2,000 in resources. If both spouses are applicants, each is limited to $2,000 in resources.
Non-countable Assets: Certain resources are excluded and may be retained in addition to the allowable countable resources. These generally include the primary residence (with the applicant’s interest not exceeding $713,000 in 2024), one automobile, certain burial funds or irrevocable burial plans, burial plots, household goods, personal effects, and a few other items.
FAQs
What Happens If My Parents Give Away or Transfer Excess Assets to Qualify for ALTCS?
Transferring assets to qualify for the ALTCS program can trigger a penalty period, delaying eligibility. It’s important to consult with an elder law attorney for proper Medicaid planning and to avoid penalties.
Will ALTCS Take My House?
AHCCCS/ALTCS has two methods to recover costs against the applicant’s home property: (1) TEFRA liens, and (2) estate recovery. Below is a general description of these methods. For specific advice, consult an experienced elder law attorney to understand how these rules may impact you and what legal steps you can take to avoid lien and/or estate recovery in your particular situation.
Liens
Arizona may impose liens on the real property of ALTCS recipients who are permanently institutionalized (i.e., residing in a skilled nursing facility) for at least 90 days. AHCCCS may place a lien on the recipient’s interest in real property during their lifetime, including property owned by a life estate deed and/or subject to a beneficiary deed. AHCCCS seeks to recover the lien upon the sale or transfer of the real property subject to the lien. However, a lien may not be imposed on a member’s home if any of the following family members are lawfully residing in the home:
- Spouse
- Individual’s child under the age of 21
- Blind or disabled child
- Sibling with an equity interest in the home who resided there for at least one year immediately before the individual’s admission to a medical institution
Additionally, AHCCCS will not seek to recover the lien or attempt recovery against any real property subject to the lien if the member is survived by the above individuals or a child who resided in the home for at least two years before the admission to a nursing home and provided care to the parent, allowing the parent to remain at home rather than in an institution.
Estate Recovery
AHCCCS has an estate recovery claim against the estate of a deceased ALTCS recipient for the value of ALTCS services rendered after the recipient’s age of 55. Assets that pass outside of the probate process (e.g., joint tenancy or direct beneficiary designation) are not generally pursued under estate recovery. Furthermore, AHCCCS will generally not impose estate recovery if the ALTCS recipient is survived by a spouse or a disabled child of any age.
For detailed legal guidance, it’s crucial to seek advice from an experienced elder law attorney to navigate these rules and protect your assets effectively.
When Do I Need an Attorney?
Legal advice is crucial when dealing with complex Medicaid rules, ALTCS planning, and protecting assets. An attorney can assist with creating Miller Trusts, handling probate, and providing guidance on long-term care planning. You will also want a Phoenix elder law attorney for estate planning, conservatorships, and guardianships.
Stated another way, it is crucial to consult an elder law attorney in the following circumstances:
- Income Only Trust: You need to set up an Income Only Trust (Miller Trust).
- Real Property Ownership: You own real estate.
- Excess Resources: You have “excess” countable resources.
- Asset Transfers: You are planning to gift or transfer assets, or the ALTCS applicant has done so within the last five years.
- Application Denial: Your ALTCS application has been denied.
- Spousal Asset Preservation: The ALTCS applicant is married, and you want to preserve assets for the well-spouse.
- Avoiding Liens and Estate Recovery: You aim to prevent AHCCCS liens and/or estate recovery against your home or other assets.
- Expediting Application Approval: You want to ensure your ALTCS application is approved as quickly as possible.
In these situations, an experienced elder law attorney can provide the necessary guidance to navigate the complex rules and protect your assets effectively.
What is “Spend-Down”?
“Spend-down” refers to the process of reducing countable assets to meet ALTCS resource limits. For instance, the countable asset limit for a single person is $2,000. If a single ALTCS applicant has $80,000 in countable assets, they need to reduce their assets by $78,000 to qualify.
Spend-down can involve paying off valid debts and expenses, purchasing desirable non-countable assets, making gifts or transfers of assets, or a combination of these strategies. The specific approach to spend-down will depend on various factors, including marital status, income, expenses, type and value of assets, medical needs, living arrangements, and personal goals. Consulting with an experienced elder law attorney can help tailor a spend-down strategy to your unique situation.
If I Receive ALTCS, Will the State Take Over My Social Security and Pension?
No, but a portion of your income may be used to contribute to your care costs.
How Much Will I Have to Pay for My Care While on ALTCS?
Your out of pocket cost will depend on your financial situation, including your monthly income and allowable expenses.
Difference Between ALTCS and Medicare
ALTCS is part of Arizona’s Medicaid program, primarily focused on long-term care, while Medicare is a federal health insurance program for those over 65 or with certain disabilities. Medicare does not cover long-term care extensively, whereas ALTCS is designed specifically for this purpose.
How to Apply for ALTCS
The application process involves completing the ALTCS application, providing documentation of income and assets, and undergoing a medical assessment (pre-admission screen). It is advisable to work with an elder law attorney to ensure accuracy and completeness.
Cost of Applying for ALTCS
There are no fees to apply for ALTCS, but legal and planning services from an elder law attorney may incur costs. These services are valuable for navigating the complex application process and ensuring eligibility.
What is the Long-Term Care Partnership Program?
Congress recognized the need to limit access to Medicaid long-term care insurance benefits due to misuse of tax dollars. To address this, they implemented stringent rules that make qualifying for Medicaid more difficult. Additionally, Congress aimed to encourage Americans to purchase private long-term care insurance.
This led to the creation of the Long-Term Care Partnership Program, which received initial funding from the Robert Wood Johnson Foundation for a pilot study. In 1992, Connecticut became the first state to offer the program. By 2008, Arizona joined as the seventeenth state to implement the Long-Term Care Partnership Program.
Currently, over 40 states have approved the Long-Term Care Partnership Program, and all except California have reciprocity agreements. This means that if you move to a new state, your long-term care insurance benefits will still be honored.
How Does the Long-Term Care Partnership Program Help with ALTCS?
The Long-Term Care Partnership Program encourages residents to purchase long-term care insurance instead of relying solely on the Arizona Long Term Care System (ALTCS). By doing so, individuals can protect more of their assets while still qualifying for Medicaid if their care needs exceed their insurance coverage. This program provides a valuable layer of financial security and flexibility, ensuring that your long-term care needs are met without depleting your estate.
Why Buy a Long-term Care Insurance Policy if You Can Qualify for ALTCS?
Firstly, not all ALTCS-approved assisted living facilities or certified ALTCS group homes are the same. Some require you to private pay with your own money for up to three years before ALTCS can become the payor for your care. A long-term care insurance policy can help cover this private pay period, granting access to better-quality ALTCS-assisted living facilities and group homes in your area.
Secondly, a Long-Term Care Partnership Program Insurance plan allows you to have up to $300,000 in countable assets while still qualifying for ALTCS long-term care benefits. Normally, you would need to reduce your countable assets to $2000 to qualify. With this insurance plan, you can protect up to $300,000 for your heirs, as your personal assets will be protected up to the amount of your insurance benefits.
It’s important to note that you must be in good health to qualify for a Long-Term Care Partnership Program insurance plan. Therefore, the best time to purchase this coverage is before age or health issues make it difficult to qualify for long-term care insurance. In other words, having the financial means is not enough; you must also meet the health requirements.
Conclusion
Understanding the Arizona Long Term Care System (ALTCS) can help you and your loved ones manage long-term care needs effectively. For personalized legal advice and assistance with your ALTCS application, call us today. Consulting with a law firm specializing in elder law can provide peace of mind and ensure you meet all eligibility requirements for this crucial health insurance program. Remember, proper Medicaid planning and long-term care planning are essential to protect your estate and secure the necessary care services.
Disclaimer
This article is for informational purposes only and does not constitute legal advice or create an attorney-client relationship. For specific legal advice, consult with an experienced elder law attorney.
