LTC Bullet:  Medicaid and Long-Term Care Financing in Georgia

Friday, August 30, 2013

Lillian, Alabama—

LTC Comment:  We’ve just completed the field work for our third state-level study this summer.  Preliminary findings on Georgia follow the ***news.***

*** TODAY'S LTC BULLET is sponsored by Claude Thau, a GA whose insight into sex-based pricing can help you secure referrals. His proprietary sales tools enable clients to make informed final decisions about buying LTCi in 15-20 minutes, let you test a client's interest in a combo product immediately, and change work-site LTCi from a proposal-delivery process to interactive consultation. The lead author of the Milliman Broker World LTCi Survey, Claude was named one of Senior Market Advisor’s 10 "Power People" in LTCi in 2007 and Chaired the Center for Long-Term Care Financing. Test Claude by calling 800-999-3026, x2241 or email him at to ask questions or get references. ***

*** R&R for SAM:  As explained below, Steve’s been on the road for four months and he has four major reports to write in September.  So he’s hunkering down on the Labor Day weekend for a much needed rest.  Then all this coming month will be devoted full time (and then some, he says) to preparing our Virginia, New Jersey, Georgia and “Index of LTC Vulnerability” reports for publication.  While Steve’s locked inside his “cave of composition,” Damon will fill in to do most of our clippings service notices, LTC E-Alerts, and LTC Bullets during the month of September.  Thanks, Damon, for taking on the extra workload. ***

*** ANNOUNCING:  CLTCR Premium Membership  --  Center for Long-Term Care Reform premium members receive our full suite of individual membership benefits including:  our LTC Bullets and E-Alerts; access to our Members-Only Zone website and Almanac of Long-Term Care; subscription to our Clipping Service; and email/phone access to Steve Moses for 24-hour turnaround queries.  Our Premium Membership is designed to give you a competitive advantage in your long-term care profession. Your increased knowledge of the critical issues and challenges we face in the field of long-term care service delivery and financing equals improved professional success for you and better LTC services for your clients and for those who have no choice but to rely on scarce public resources.  Premium Membership is $250 per year, paid up front or monthly by automatically recurring credit card payments.  Contact Damon at 206-283-7036 / to start your Premium Membership immediately or go directly to our secure online subscription page and sign up for as little as $21 per month. ***



LTC Comment:  Steve Moses has been on the road in the Silver Bullet of Long-Term Care since May 1 conducting studies of Medicaid and long-term care financing in Virginia, New Jersey and Georgia.  He’s headed home now with the huge task to write reports on all three studies before the end of September.  As if that’s not enough, he’s decided to add a fourth report on what we plan to call “The Index of Long-Term Care Affordability.”  See “LTC Bullet:  The Index of Long-Term Care Vulnerability” for more on that new method to measure states’ potential to sustain their existing LTC service and financing systems.  For now, however, here’s a quick overview of our findings regarding Georgia’s Medicaid and long-term care financing system.  We’ll have much more to come about all three states as the final reports are written and published.


Preliminary findings of “How to Reduce Medicaid Expenditures and Improve Long-Term Care,” a project conducted for the Georgia Public Policy Foundation by The Center for Long-Term Care Reform, August 29, 2013

Georgia has one of the tighter Medicaid long-term care financial eligibility systems in the country, when enforced.  For example, it operates an “income cap” system meaning people with incomes over $2,130 do not qualify for Medicaid-financed nursing home care.  They cannot deduct their medical and LTC expenses to “spend down” to the Medicaid income eligibility limit as in more liberal “medically needy” income eligibility systems.  Georgians, however, can achieve the same purpose by setting up Miller income diversion trusts or “Qualified Income Trusts” (QIT).  QITs allow people with excess income to qualify for Medicaid LTC benefits by diverting the excess income into a special trust designed for that purpose.  We will explain how, why and how often this is done in the final report. 

Georgia has already implemented a managed care system for most of its recipients (poor women and children) and intends to implement managed care for the aged, blind and disabled.  People eligible for both Medicaid and Medicare (dual eligibles) may in time be included in the managed care program, although there has been some political push back from that objective.  Georgia has already “rebalanced” its Medicaid long-term care program from mostly nursing home care to nearly half home and community-based care.  It has made Medicaid long-term care more attractive as a long-term care funding source and delivery system and is continuing to do more of the same.  Less planning has been done to prepare for the reality that a huge new older generation will soon flood the state’s social programs, of which Medicaid long-term care is one of the most expensive.  Our final report will develop this theme and suggest corrective actions.

Georgia, like most states, runs the risk of Medicaid long-term care crowding out other key state services, especially education.  Certain measures can be taken, however, to reduce this risk.  One such measure we’ll recommend is to enhance DCH’s [the Department of Community Health contains Georgia’s Medicaid program] estate recovery efforts both to generate non-tax revenue but also and especially to awaken citizens that Medicaid LTC expenditures must be repaid after death.  Currently Georgia exempts the first $25,000 of deceased recipients’ estates from recovery.  As average recoveries in successful estate recovery programs are much lower than that, Georgia is leaving a large amount of potential non-tax revenue unrecovered.  Unless and until Medicaid eligibility spend down requirements become much stronger, failure to enforce estate recoveries aggressively turns the program into free inheritance insurance for baby-boomer heirs who should instead be getting the message that LTC is a personal responsibility for which they should prepare.

Unsurprisingly, Georgia’s inconsistent enforcement of Medicaid financial eligibility “spend down” rules, numerous Medicaid planning firms helping affluent Georgians qualify, and lax estate recovery enforcement seriously discourage early and responsible long-term care planning.  The state’s Long-Term Care Partnership program, which allows purchasers of the product forgiveness of their Medicaid spend down liability to the extent of the private coverage they actually use, goes unpromoted.  The state is moving toward a much more expensive Medicaid LTC program in the future because of the approaching baby-boomer Age Wave at the same time as it is making the program more attractive and private-financing alternatives less likely to succeed.  Georgia’s current intention to avoid Medicaid expansion under the Affordable Care Act may mitigate this risk somewhat, but some of our respondents indicated that the state may choose to expand Medicaid after all following the Gubernatorial election.

I believe our findings will be on point and very timely.  As Senator Renee Unterman told us in an interview “it is imperative to do self analysis like your study” and this is a “sensitive issue but a good time to deal with it.”