Core Supports for Aging in Place
By Mark Olshaker, Previously published by Reverse Mortgage magazine Sept/Oct 2019
Are your clients taking advantage of what is available?
There are many components to aging in place successfully and it is a good idea to be familiar with the core supports that can give older adults of all income levels and with varying health situations the best chance to enjoy the years they remain in their homes.
The following information comes from Kelli Vasquez, chief operating officer and chief population health officer of Square Care Managed Services Organization of New York. She holds both MBA and MSW (Master of Social Work) degrees and has extensive experience on both the clinical and administrative levels of care. She stresses the importance of advocacy for seniors, especially those with ongoing health concerns, saying, “If they had an advocate, they’d be in much better shape.”
The objectives for the interested party are to: become familiar with the various medical and financial benefits available to seniors and disabled elderly people; understand where to go and how to apply for benefits; be able to apply the use of these benefits to real world scenarios; and to understand the interaction of aging in place services with other medical benefits.
Aging in Place Considerations
For efficiency, we will use gender pronouns interchangeably, rather than having to specify “his or her” each time. In evaluating the practicality of aging in place for a particular individual or couple, the first consideration is whether that person is still able to do normal things on his own. These are referred to as Activities of Daily Living, and include ability to wash and dress oneself, move around, take care of food and medication, use the bathroom and perform all other actions that get us through the day.
Drilling down one level further, assessment should include potential for falls, depression, alcohol and drug misuse screening, pain, memory and dementia assessment and home safety, all to make sure the client is safe in his home setting.
Once this is determined, then comes the financial details, such as evaluating the client’s current benefit structure and coverage, any gaps or additional needs in that coverage and income and other financial resources.
Types of income to consider include wages if either spouse is still working, pension, VA benefits, IRA distribution, savings accounts, sale of property and reverse mortgage proceeds.
Finally, what is the advocacy and support structure? Who is advocating for her? Who is her emotional support and are they close by? Does she need help managing medication dosing and/or meal preparation? Does she have easily accessible ways of getting to and from doctor visits and other appointments?
Social Security is available at retirement age and is based on how much was contributed during the individual’s working life. This is determined by a “work credits” formula.
Supplemental Security Income (SSI) provides for low-income persons regardless of work credits and is intended to bring the monthly income closer to normal Social Security payments. SSI is currently $750 per month for an individual and $1,125 for a couple.
Social Security Disability Income (SSDI) is available at any time a long-term disability occurs, as long as the individual has worked at least five years.
Paying for Care
Paying for care is one of the most important issues and greatest challenges facing many seniors, so we will break services and benefits down into their components.
Commercial Health Insurance is available through many employers but may or may not continue as part of a retirement plan. If it has to be paid for individually out-of-pocket, it can be quite expensive, often well over $1,000 per month. That is why Medicare is such a critical component of the lives of the vast majority of seniors.
Long-Term Care Insurance is growing increasingly expensive and difficult to obtain but can pick up coverage on certain items and services not covered by government benefits. A specific plan may not be accepted by all service providers.
Medicare is available at age 65, or if a person is blind, disabled or has end-stage renal disease.
Medicare Part A covers hospital care and is free if the user has accumulated ten or more work credits. It covers hospital care, a skilled nursing facility up to 100 days, hospice care, skilled home nursing care, and home care – physical therapy, occupational therapy speech therapy, a home health aide or social worker, as medically necessary.
Medicare Part B covers physician services; outpatient physical, occupational and speech therapy; inpatient, outpatient and partial mental health services; durable medical equipment; and ambulance services. It normally costs $134 per month, plus an annual deductible, which generally covers 80 percent of allowable charges. If the individual continues to work and earn money, the monthly cost can be higher. Once he begins receiving Social Security payments, the monthly premium is usually deducted directly before payment.
Medicare Part C is an alternative to Parts B and D, in which the individual signs up for a managed care plan, similar to an HMO. Premiums vary based on the plan chosen.
Medicare Part D covers prescription drugs. Premiums vary based on the plan chosen and require copays and deductibles.
Medicare Supplements are private insurance plans that cover the 20 percent that Medicare does not cover, rather than having to pay out-of-pocket. Plans generally range from $100 to $300 per month.
If commercial insurance is maintained as part of a post-employment retirement package, it can act as the Medicare Supplemental. A coordination of benefits must be conducted, and may be carried out by the company’s human resources department or other benefits coordinator.
It can be difficult to figure out which is the best plan for any given individual or situation, whether we are talking about Part D or supplemental coverage. The Medicare website, www.medicare.gov can be helpful in determining the best coverage available for each person’s situation, organized by geographical area.
What doesn’t Medicare pay for? Custodial care, transportation, most dental care and dentures, day programs, acupuncture, cosmetic surgery, hearing aids, routine foot care, eye exams and prescription eyeglasses.
Medicaid is medical insurance for low-income persons. It covers long-term care, transportation, supplies, home health aides and other items. It is half-funded by the federal government, so eligibility and benefits vary by state. Income guidelines for eligibility have changed with the expansion of the program through the Affordable Care Act (ACA, or “Obamacare”). Like the ACA, it has also become something of a political hot button, with politicians and commentators regularly debating how extensive and inclusive it should be.
Medicaid can also pay the 20 percent of Part B expenses that Medicare doesn’t cover.
In New York State, for example, about 6,400,000 people receive coverage through the Medicaid program, and adults with incomes up to 137 percent above the federal poverty level are eligible. Children whose families have incomes up to 400 percent above the poverty level are eligible for the Children’s Health Insurance Program.
Each state has its own procedures, but in New York, individuals or couples without children must apply through the New York State Health Marketplace: www.healthbenefitexchange.ny.gov.
Individuals who are blind, disabled, chronically ill, institutionalized and applying for nursing home care or age 65 or older, must apply to their local Department of Social Services, for which they will fill out Supplement A (or have filled out for them), a paper application packet: www.health.ny.gov/forms/doh-4220all.pdf. The application will cover demographics; all other persons living in the home; current income from Social Security and any other sources; total housing expenses; water expenses; health insurance expenses; and unpaid medical bills. The application requires proofs of residence, date of birth, citizenship, income, housing and water expenses, unpaid bills and copies of health insurance cards.
Though it may be mailed, Vasquez strongly suggests bringing the completed packet directly to the DSS office.
A Medicaid case worker is assigned, and the packet is reviewed, which usually takes between one and three months. Once an eligibility determination is made (through a formula) the patient receives a letter in the mail. If the application is denied, there is an appeal process available.
It is also possible that the application will be approved with a “spend down,” also known as excess income or surplus. This means the patient is over the Medicaid income guideline, but still has a need for Medicaid due to disability, age or high medical bills. The spend down amount is calculated as monthly income minus $842. The patient can pay the spend-down amount directly to Medicaid, show receipts for care to prove this amount is being spent on healthcare or, if she has proof of disability, she can apply for a Pooled Income Trust.
In these trusts, money equal to the spend-down amount is typically deposited monthly in shared accounts. The patient then submits her bill to the trust, which pays them as a third party. Reports are provided to Medicaid annually for recertification. The trust may also charge a monthly or annual service fee. Any remaining funds are donated to a designated charity when the patient passes away.
“This essentially hides your money, so the spend-down is gone,” Vasquez explains. “It may seem like a trick, but it’s actually designed to allow people who have high medical needs to use their Medicare.”
Managed Long-Term Care programs have been created to manage the care of elderly or disabled persons in their homes rather than having to send them to nursing homes. These programs pay for services Medicare doesn’t cover, including transportation, medical supplies, assistance with medication cost, podiatry, dentistry, hearing aids and case management. To be eligible, the patient must qualify for Medicaid and require 120 days or more of skilled help. For New York, the assessment document can be found at: www.health.ny.gov/health_care/medicaid/redesign/docs/mltc_guide_e.pdf.
In addition, there are a number of ancillary benefits available to those in need, such as housing subsidies for rent and utilities. For those not receiving proper nutrition, there is SNAP – the Supplementary Nutritional Assistance Program, commonly known as food stamps. If the individual is Medicaid-eligible, he will automatically qualify for SNAP, but may be eligible even without Medicaid.
Social Determinants of Health
“Case management is where someone is working with you one-on-one to make sure your healthcare needs are met,” Vasquez states. “It’s really crucial for people who want to age at home, because it coordinates all the things we’ve been talking about.”
There are several components to the case management process that should work in sequence. They all relate to the social determinants of health, a wide-ranging set of facts, circumstances, personal, family and community dynamics and means of achieving certain ends.
What About a Reverse Mortgage?
For a senior with home equity and the capacity to remain in her home, a reverse mortgage fits in well to an overall retirement plan and the ability to age in place successfully. It can pay for home upgrades or modifications, home care, regular expenses and lifestyle enhancement.
If the client considering a reverse mortgage is on Medicaid, the situation must be analyzed carefully.
Medicaid looks at both monthly income, which can be managed through a pooled income trust, and financial assets and resources, such as cash in the bank. So, if a reverse mortgage offers a new source of income for a recipient, it is important to understand how that impacts Medicaid eligibility.
Reverse mortgages are considered unearned income. Under Aid to Dependent Children, for low-income families and singles or childless couples, a reverse mortgage is disregarded as both income and assets or resources. For SSI recipients, however, the reverse mortgage is disregarded as income but counts as an asset or resource. So, if the reverse mortgage is a reverse annuity mortgage, it is counted as income in the month it is received and a resource thereafter.
For all other categories of Medicaid, it is necessary to consider how the reverse mortgage is written with regard to monthly income. In some cases, the spend-down requirement might apply.