New Elder Law Rules for 2017

How legislative, regulatory, and policy updates in 2016 will affect seniors in 2017

Marielle Hazen, CELA

MEDICARE

Social Security and Medicare Trust Fund 2015 Report

•49.2 million people received Old Age and Survivor Insurance benefits

•10.8 million received Disability Insurance Benefits

•55.3 million received Medicare benefits

Medicare Reform Proposals

Speaker Ryan Proposals:

–Gradually increasing the Medicare eligibility age from 65 to 67 starting in 2020;

–Provide a fixed dollar subsidy for purchasing Medicare;

 –Increase subsidies to Medicare Advantage plans and

allow them to create packages of services and benefits;

–Limit the ability of Medigap plans to offer first- dollar coverage.

Medicare Appeal Delays• Class Action - Lessler v. Burwell (now captioned

Exley v. Burwell), No. 3:14-cv-1230 (JAM) (D. Conn. June 10, 2015)

• Proposed changes to Medicare appeals process

Observation Status• Classification of hospital patients as "outpatient"

receiving observation• BAGNALL v. SEBELIUS, No. 3:11-cv-1703 (D.Conn.,

filed Nov. 3, 2011)•NOTICE Act

Medicare Quality Measures

•Nursing Home Compare •Home Health Compare•Hospital Compare•Dialysis Facility Compare• Physician Compare

MEDICAID

Genworth Cost of Care Survey•Homemaker Services - $4,099/mth/44 hrs/wk

•Home Health Aide - $4,109/mth/44 hrs/wk

• Adult Day Care - $1,300/mth/ 5 days/wk

• Assisted Living Facility. $3,600 per month

•Nursing Home Semi-Private - $9,071/mth

•Nursing Home Private - $9,733 per month

Managed Long Term Supports and Services (MLTSS)

•MLTSS is the delivery of long-term supports and services through capitated managed care programs

• Called Community Health Choices in PA

CHC Population• The CHC Program is the Commonwealth’s statewide

mandatory Medicaid managed care program.• Participants will receive Medical Assistance (MA)

physical health services and Long Term Services and Supports(LTSS) for those requiring assistance• CHC will serve the following Participants:–Adults age 21 or older who require MA because

they need the level of care provided by a nursing facility –Dual Eligibles age 21 or older whether or not they

need or receive LTSS.

CHC Objectives• Enhance opportunities for community-based living for

Participants• Strengthen coordination of LTSS, physical health and

behavioral health.• Ensure better coordination between Medicare and

Medicaid• Enhance quality and accountability.• Advance program innovation.• Promote the expansion of team-based approaches to

service delivery (e.g. patient centered medical homes).• Increase consumer access to needed services, especially

in rural and underserved areas of the Commonwealth.

CHC Components• Covered services include:– Long-term Services and Supports either a Nursing

Facility Services or Home and Community-Based Services.–Physical Health Services such as, but not limited to:• Hospital-based services• Pharmacy• Primary Care Physician and Specialist Services• Durable Medical Equipment• Transportation• Emergency Services• Hospice

CHC Components• Service Coordination Objectives:–Includes:• Coordination of services available through Medicare,

Medicaid LTSS, Medicaid Physical Health Services, and Medicaid Behavioral Health Services.• Participant assistance in accessing, locating and

coordinating needed Covered Services and non-Covered Services such as social, housing, educational and other services and supports.• Monitoring provision of services to ensure that

assessed needs are being met.

CHC Enrollment Process

IEE

Independent Enrollm

ent Entity

Assist in filling out application

Schedule clinical eligibility screening, if needed/requested

M

CO

Choice Counseling

Clinical Eligibility

W

ill be perform

ed by a conflict free entity

CAO

County Assistance O

ffice

Financial Eligibility determ

ination

Issuance of eligibility notice

MCO

M

anaged Care O

rganization

Contact new

enrollee w

ithin days of enrollm

ent

Conduct com

prehensive needs assessm

ent to begin the person centered planning process

CE

When CHC starts

• July 1, 2017 for Southwest PA (including Pittsburgh)

• January 1, 2018 for Bucks, Chester, Delaware, Montgomery & Philadelphia

• January 1, 2019 for the rest of PA

Aging Waiver Enrollment• Beginning April 1, 2016, Independent

Enrollment Broker handling Aging Waiver

•New procedure outlined in Appendix 3 of materials

Reform Bills

•HR 1361 - Medicaid HOME Improvement Act

•HR 1771 -

SPECIAL NEEDS PLANNING

ABLE Act of 2014• Achieving a Better Life Experience Act of 2014

• Signed by President Obama on 12/19/14

What is ABLE?

Achieving a Better Life Experience Act of 2014

Roughly based on the structure of 529 college savings accounts.

Type of tax-advantaged account that can be used to save funds for the disability-related expenses of the account’s designated beneficiary.

ABLE Resources•The ABLE Act – H.R. 647 of 2014

•SSA POMS SI 01130.740 - Effective 3/21/16

• IRS Interim Guidance – Notice 2015-81

•PA ABLE (SB879)–Signed by Governor

4/18/16

•PA ABLE (HB 1319) not yet passed.

ABLE Act Accounts - §529A

•Only ONE account per beneficiary

•Originally had to be established in beneficiary’s state of residence but that requirement eliminated in December, 2015

• Eligible beneficiary status:–Blindness or disability occurs before beneficiary

attains 26 (§529A(e)(1)(A))

ABLE Account $ Limits

• Total annual contributions limited to amount of federal gift tax exclusion ($14,000 in 2016) (§529A(b)(2)(B))

• Total CONTRIBUTIONS over time limited to state’s 529 max ($511,758 in PA in 2016)

• If account VALUE over $100,000, beneficiary’s SSI benefits are suspended but MA retained

ABLE Account Tax Benefits

•No federal income tax deduction on contribution but account grows tax-free•Withdrawals tax-free if for “qualified

disability expenses” -- “any expenses related to the eligible individual’s blindness or disability which are made for the benefit of an eligible individual who is the designated beneficiary, including the following expenses: education, housing, transportation, employment training and support, assistive technology and personal support services, health prevention and wellness, financial management and administrative services, legal fees, expenses for oversight and monitoring, funeral and burial expenses” and other expenses approved by IRS regulations (§529A(e)(5))

ABLE Accounts and Public Benefits

• ABLE accounts are not countable for Medicaid eligibility

• ABLE accounts with balance not exceeding $100,000 will not interfere with SSI eligibility. If balance increases above $100,000, SSI benefits will be suspended until account balance is reduced. (ABLE Act §103(a)(2))

•Distributions from ABLE accounts do not count as income for the account beneficiary for purposes of SSI or Medicaid eligibility regardless of whether the distributions are for non-housing qualified disability expenses, housing qualified disability expenses, or nonqualified expenses

• Account rollovers to a disabled sibling are permitted

ABLE Account Payback

• At beneficiary’s death, state may file claim against remaining funds (§529A(f))–State is creditor–Payback required; state claim is optional–Payback starts with date ABLE Account started

(§529A(f))

PA ENABLING LEGISLATION SAYS COMMONWEALTH WILL NOT SUBMIT CLAIM

• Payback subject to outstanding payments due for qualified disability expenses

• Payback includes 3rd party contributions

Potential Pitfalls with ABLE

• 3rd party funds exposed to payback

• Creation of multiple accounts

•Over-funding

• Lack of fiduciary accountability

When will ABLE be Attractive?

• Insufficient funds to create 1st party SNT–Where earned income accumulates over time–Where 21 year old has UTMA account–Small inheritance•Desire to give control to competent

beneficiaries• Saving for specific expenditure – car or home•Disability has potential to resolve•Over-65 beneficiary with lifetime disability

ABLE Expansion Bills(Federal)

•H.R. 4813 – would increase eligibility age from 26 to 46

•H.R. 4794 – would allow for rollovers between 529 and ABLE accounts

•H.R. 4795 – would permit account beneficiaries who work to save additional funds above the current $14,000 maximum

1st Party SNTs

•SSA Emergency Guidance on Excess Resource Notices

•Special Needs Trust Fairness Act

Disabled Military Child Protection Act

• Enacted December 12, 2014

• Amends Title 10 of the United States Code to allow for monthly annuities under the Survivor Benefit Plan (SBP) to be made to a supplemental or special needs trust established for the sole benefit of a disabled dependent child of a participant in the SBP.

•December 2015 – Implementation Policy issued

HUD Housing and SNTs•DeCambre v. Brookline Housing Authority•Payments from a special needs trust not

income when determining the beneficiary’s eligibility for a housing voucher

VETERANS BENEFITSVA Proposed Rulemaking

•Proposed rulemaking published January 2015

•Net Worth, Asset Transfers and Income Exclusions for Needs-Based Benefits

ESTATE AND TAX PLANNING

Power of Attorney Changes

SB 1104 – Now Act 79 of 2016 •Signed by the Governor July 8, 2016•Provisions include:–Health Care Powers–Relationship of Agent to Guardian–Gifting–Additional short form powers

HB 665 of 2015

Basis Reporting Requirements

• Surface Transportation and Veterans Health Care Choice Improvement Act of 2015 – Signed by President Obama July 31, 2015

• Intended to improve consistency between adjusted basis and estate tax values

• IRS guidance published in Federal Register March 4, 2016

Fiduciary Rules•Department of Labor Final Rules published

April 6, 2016• Compliance Requirements begin April 10, 2017

ELDER LAW

Guardianships•SB 568–Currently in House Judiciary Committee

–Expected to move next session

CARE Act• Caregiver Advise, Record and Enable Act

• Approved by the Governor April 20, 2016

• Effective April 2017

Caregiver Designation•Hospitals must provide each patient (or legal

guardian) opportunity to designate lay caregiver

• For minor children, custodial parent has authority to designate

• If patient designates lay caregiver, hospital must promptly request written consent of the patient to release medical information to the lay caregiver.

Role of Lay Caregiver

• Lay caregivers are not obligated to perform services

•Hospital must notify lay caregiver of any discharge order, actual discharge or transfer to another facility

Hospital Discharge Plan

• Prior to discharge, hospital must consult with lay caregiver and issue a discharge plan that describes the patient’s after-care assistance plan

• If hospital is not able to contact lay caregiver, this shall not interfere with medical care or appropriate discharge. Nothing in the act shall be construed to delay discharge or transfer of patient

Hospital Discharge Plan

•Must include:–Name and contact info for lay caregiver–Description of all after-care assistance necessary

to maintain ability to reside at home–Contact information for any health care,

community resources, long-term care and support services needed for the discharge plan–Contact information for hospital employee who

can respond to questions about discharge plan

Instructions for Lay Caregivers

•Hospital must provide lay caregiver instructions for after-care.

• Training and instructions may be conducted in person or through video at discretion of lay caregiver

• Instructions must include live or recorded demonstration of tasks to be performed and an opportunity for questions

Advance Directives and CARE Act

• Patient may designate lay caregiver in an Advance Directive

•Nothing in this Act shall be construed to interfere with rights of an agent under a valid advance directive

Hospital Liability and CARE Act

•Nothing in the act shall be construed to create a private right of action against a hospital, hospital employee or any consultants or contractors

Orphan’s Court Rules• Rescinded and replaced:–Rules 1.1 through 13.3 and Rule 17–Rule 1.5 - effective 8/1/2016 • Amended effective 9/1/2016–Rules 14.1 through 16.12

• Additional Proposed Rule Changes Pending