The primary source of funding for care in the home is private funds. Unlike some other states such as New York, New Jersey has no governmental program that provides 24/7 home health aide or companionship care. For a person with limited savings and low income, this creates an obvious problem if they wish to remain in their home (as most people do).
Since it is very likely that an elder who requires 24/7 care will eventually need to apply for Medicaid, and there is a 5-year look-back for eligibility, all elder care planning needs to take into account potential issues under that program, which are in three primary categories: income, resources, and transfer penalties.
Medicaid can pay for home care under the Home and Community Services waiver program. The available assets (not counting the house) must be below $2,000. However, this Medicaid program does not provide 24/7 services. In a nursing home, 24/7 care is paid by Medicaid. You apply for benefits once care giving is in place in the home, or once you are already occupying a bed in a nursing home.
Monthly Income Eligibility
If income exceeds $2,199 (2015 level), it must be routed through a Qualified Income Trust.
The applicant can only have $2,000.
As of the date for which eligibility is sought, the spouse can have:
Half of the total combined assets that the couple had on the 1st day of the 1st month in which the applicant became an institutionalized person (nursing home or Medicaid), or began to pay for care in the home. This half is called the Community Spouse Resource Allowance (CSRA). The CSRA need not be less than $23,844 and cannot exceed $119,220.
The marital home is not counted, regardless of value, as long as the person or spouse lives there.
One car for the applicant or community spouse is not counted.
Irrevocable funeral trust, the spouse's funeral trust, and the family burial vaults or plots are not counted.
Real estate that cannot be sold or which is on the market will not be counted.
Generally, all other assets are counted.
Lien after Death
There will generally be a Medicaid lien against any assets in the applicant's estate after he or she dies except for certain limitations (such as if there is a surviving spouse).
Filing of Application
The Application is filed at the County Board of Social Services after the assets have been "spent down" to the levels above. Five years of records must be submitted for the look-back, which is a 5-year review of all financial transactions to distinguish between (a) gifts and (b) payments for goods and services.
Impact of gifts on eligibility
Uncompensated transfers that were made during the look-back generally result in ineligibility for a calculated period of time, called a transfer penalty.
Some gifts are exempt, such as:
Transfers to the spouse
Transfer of the house to the "caregiver child" or sibling if they meet certain requirements
Transfer of assets to a disabled child
Transfers to a trust for a disabled person under 65
Transfers to the applicant's own Special Needs Trust (SNT) are exempt if the transfers occur when the applicant is under 65 years old and the SNT meets all of the requirements.
Transfers shown to have been made exclusively for some other purpose can avoid a transfer penalty period.
After the person becomes eligible for Medicaid in a nursing home, all of their income except specific deductions must be turned over to the facility as a cost share. So they cannot use any of their income to pay real estate taxes, insurance or water/utility bills while the house is on the market. For just the first 6 months after entering the facility, it is presumed they could return home. So for that brief time, they can apply up to $150/month toward these home expenses.
Medicaid Home and Community Based Services(HCBS) under Medicaid Long Term Services and Supports
Medicaid has several community-based programs to provide assistance to people who are otherwise eligible for Medicaid, but who can still live in the community, whether in their own homes or apartments, in assisted living facilities, or in other settings. These programs are called Medicaid Waiver Programs, authorized by Congress in section 1915(c) of the Social Security Act. See 42 U.S.C. 1396n(c). The New Jersey Division of Medical Assistance and Health Services (DMAHS) regulates these programs, which are administered by the office of Aging and Community Services (a division currently relocating from DHSS to DHS).
Applications are filed with the County Board of Social Services once the person meets the financial eligibility criteria. There is no retroactive coverage if the person is to receive home-based services, but there can be in an assisted living facility if the clinical eligibility was also determined. If a person is receiving Medicaid benefits in a nursing home and can now return home, he or she can request HCBS. A case manager coordinates community services and supports. The income of the spouse is not counted. The house is considered an exempt asset. The gift, trust, and transfer rules that apply to institutional Medicaid also apply to this program. There should not be a waiting list for services, but some counties will not have as many participating providers as other counties.
The Medicaid participant can use his/her monthly income in whatever way s/he wants. There is no "co-pay" or contribution to Medicaid from the income. All participants who receive care in the community will get their Medicaid state plan services through a Managed Care Organization overseen by a care manager.
The programs pay for a broad array of services in a private home, rooming house, boarding home, residential health care facility or residential hotel. These services are not available in a nursing home or hospital. The care plan must be designed for restorative or rehabilitative care, or to provide supportive care for a person in declining health. The available services must include case management and may include certified home health aides, adult medical day care, visiting nurse, housekeeping, home health services that are geared toward restoration and rehabilitation, usually after a hospitalization (such as speech therapy, occupational and physical therapy); medical supplies; specialized medical equipment; non-emergency medical transportation to health care providers; respite care (for family care-givers) in a nursing home or by means of extra home health aide services at home. The services must be provided by a home health care agency approved to participate in Medicaid.
Typically, a set budget that cannot be exceeded is provided to the program participant for the services needed. There is no actual hourly cap on home health aide services but the cost must fall within the state's specific guidelines. Many participants get few hours. You can apply to the state to exceed the limit based on special circumstances that place the participant at risk for nursing home placement without the extra assistance. An assessment is done by a nurse for the Department of Health, utilizing an assessment protocol or tool that the state has designed for this purpose. If live-in care is required, and there is no capable family member providing the rest of the care needed around the clock, the family could contract with an agency which also participates in Medicaid, and the agency will split the bill by billing Medicaid for whatever Medicaid will pay, and billing the family for the balance. A non-spouse, non-guardian family member can also be paid by Medicaid as the "Participant Employed Provider."
There are a few non-Medicaid programs in New Jersey also, for people who are NOT eligible for Medicaid because they have too much money. Jersey Assistance for Community Care (JACC) is for people over 60 who have up to $3,580/month income ($4,845 for married couple) and $40,000 in liquid resources ($60,000 for a married couple). This program has a long waiting list and a limited benefit. It provides up to $7,200/year of subsidies per person. Individual counties may have home care programs of their own funded with county monies.