liens

The Centers for Medicare and Medicaid Services has clarified that most of the rules of when liens are asserted by the government to recover the money spent on Medicaid health care for long-term care will apply to people who are getting Medicaid under the Affordable Care Act expansion, The Southern reports. States are entitled to asset recovery for all health care benefits, but CMS hopes that states will only impose liens and try to recover from estates for nursing home cases, The Southern also reports.

Separately, NJ.com reports that the "Affordable Care Act encourages states to expand their Medicaid rolls so single people and childless couples can now qualify if poor enough. That means thousands of newcomers to Medicaid may not realize that ultimately they may have to repay the piper."

Many more people are eligible for Medicaid under the Obamacare expansion: adults with incomes under 133 percent of the poverty level. Can the government recover the expenses paid out for these new Medicaid enrollees through liens on their properties and recoveries from their estates?

The Health Affairs blog reports on how the Centers on Medicare and Medicaid Services is advising states on applying liens to consumers who are getting Medicaid under the new expansion. Elderly Americans often get their long-term care paid through Medicaid, but there has been a concern that people "would voluntarily impoverish themselves, transferring assets to their children or to others to make themselves eligible for Medicaid," the blog reports. Medicaid can impose liens on people's houses and other assets to get that long-term care paid back. Now the questions is how the rules about liens should be applied to people who are newly eligible for Medicaid under the Obamacare expansion.

The first upshot, the blog reports, is that liens can't be placed on the property of new Medicaid enrolees. The second upshot is that CMS advises states to try to recover from the estates of new Medicaid receipients who receive long-term care, but not other types of care: "In sum, most of the rules that apply to traditional Medicaid recipients with respect to [long-term care services and supplies] LTSS (except for lien requirements) are likely to apply to [modified-adjusted gross income] MAGI-eligible individuals who receive LTSS.  CMS intends, however, to take steps to avoid applying estate-recovery rules to [modified-adjusted gross income] MAGI-eligible individuals who do not receive LTSS to keep this from becoming a barrier to Medicaid expansion eligibility."

The Chicago Tribune reports on how a "little-known" provision in the Medicaid health-insurance expansion is going to increase the practice of the government asserting liens on patients' assets to recoup expenditures on medical costs: "The issue arises because of a provision in the long-standing laws governing Medicaid that compel states to recoup certain medical costs after a person dies, either via liens placed on an individual's home or claims on their assets." Liens are not asserted in private insurance policies bought on state-based insurance exchange.

The Tribune reports that new Medicaid patients could face liens even if they don't seek medical care: "In another twist, all new Medicaid patients in Illinois were placed into so-called managed-care programs, in which the state pays insurers on a per-member per-month basis. That means people like Rosato will be racking up health care costs even if they don't seek any medical care. In theory, that money could all come out of their estates once they die."

Some states, included Oregon and Washington, have tweaked their regulations to apply recovery efforts only to long-term care, The Tribune further reports. However, Illinois has not.

The Centers for Medicaire & Medicaid Services said it will provide guidance to states sometime soon.

As health-care expands in an effort to cover all Americans, the Medicaid expansion could mean that more people over the age of 55 will face liens being placed on their assets for their care, according to a report in BenefitsPro. "Washington and many other states, including California, Florida and New York, interpret the [federal] regulations to mean that they should use liens to try to recover any money spent by Medicaid on any care for people ages 55 and older, not just for long-term care specifically," BenefitsPro also reports. But regulators in Washington issued an emergency rule to limit lien recoveries only to Medicaid funds spent on long-term care in order to reduce a disincentive for people to sign up for health-care coverage, BenefitsPro concludes