LTC Bullet: New York LTC
Executive Speaks Out
Friday June 19, 1998
Seattle--
Carl Young, President of the New York Association of Homes and
Services for the Aging, replied to our most recent LTC Bullet
regarding the chilling effect of Medicaid asset transfers on private
LTC insurance. Mr. Young's provocative response is quoted below
verbatim:
"In New York, you don't know the half of it. If we assume
that there is only one resident per nursing facility who is on
Medicaid by virtue of accelerated asset divestiture per year,
the cost to the taxpayers is at least $28 million per year (630
nursing homes X $45,000 average annual
Medicaid cost). You could fit into the average phone booth the
number of facility operators who believe that there is ONLY one
per facility. If we assume only one per cent of residents abusing
the system (more accurately, their families and their lawyers),
the number jumps up to over $50 million (115,000 beds X .01 X
$45,000) There is not a single week in the Albany area when there
is not AT LEAST one "seminar" going on. The bureaucrats
are a poor source of information on this issue. They have no way
of knowing. Nursing home administrators who have face-to-face
interaction with the families and the residents have a better
fix on the magnitude of this activity. My counterparts from a
number of states tell me that there is more activity than officials
think."
The previous LTC Bullet to which Mr. Young is responding is reprinted
below:
LTC Bullet: States Put LTC Puzzle Pieces Together
In the current issue of the prestigious journal "Health Affairs,"
Josh Wiener and David Stevenson of the Urban Institute confirm:
"state officials believe that reducing [Medicaid] asset transfer
is a critical prerequisite to motivating citizens to purchase
long-term care insurance policies and, more generally, to viewing
long-term care as a private responsibility."
The complete quotation follows: "Over the past several years
policy-makers and the media have focused attention on middle-class
and wealthy elderly persons who transfer, shelter, and
underreport assets--so-called Medicaid estate planning--to appear
poor enough to qualify for Medicaid-financed nursing home care.
Congress has legislated against these practices on numerous occasions
(most recently in the Balanced Budget Act [BBA] of 1997), but
some argue that the legislative prohibitions are easy to circumvent....
Although the rhetoric surrounding the issue is passionate and
all states acknowledge it as somewhat of a problem, Massachusetts,
New Jersey and New York were the only ANF [Assessing the New Federalism
study] states in which asset transfer was thought to be a major
public policy issue. It is of particular concern in New York,
where there are approximately 1,200 elder-law attorneys and where
newspaper and magazine advertisements relating to asset transfer
are said to be ubiquitous. The litigious culture and the hostility
of the state courts to rules requiring middle-class citizens to
impoverish themselves make cracking down on asset transfer difficult.
Nonetheless, state officials believe that reducing asset transfer
is a critical prerequisite to motivating citizens to purchase
long-term care insurance policies and, more generally, to viewing
long-term care as a private responsibility." (Joshua M. Wiener
and David G. Stevenson, "State Policy on Long-Term Care for
the Elderly," Health Affairs, Vol. 17, No. 3, May/June 1998,
p. 86.)
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