Knowing Your Benefits  

by Jamie Talan

Kathleen Torelli was 59 years old when her husband and children began noticing she was repeating herself in the space of a few minutes.

She had worked herself up to management in a bank’s mortgage division and now this determined woman was shrinking into herself. She was growing quieter by the day.

She forgot to pay bills. She couldn’t keep on task at work. A family doctor said she was depressed, but no medicines lifted her up and out of her sofa. She spoke only when nudged to interact. The medicines didn’t work. The diagnosis didn’t fit.

Finally, her husband brought her to a neurologist who asked her to complete the battery of tests used to point in the direction of Alzheimer’s. That was his suspicion after listening to her story. He put her on the standard therapies — Aricept and Namenda — and every three months the neurologist would repeat the cognitive tests. Sadly, he was right because Kathleen Torelli soon forgot what season it was and whether she had just taken an elevator to get to her appointment.

Then, whatever was ripping through her brain cells accelerated its course. She became agitated and angry. She screamed at her reflection, wherever she was. Her words no longer made sense. Her family took down the mirrors and the screaming continued. By 65, she no longer remembered how to use a fork. Walking up stairs was an exercise in itself. Her family would find her on the toilet fully clothed. She resisted showers. She fell. And despite the round-the-clock care of her husband and grown children, regardless of the fact that her brain was sick, Kathleen did not qualify for acute home medical care under her Medicare policy. One after another, employees of the federal insurance policy said that it was not a medical necessity.

The neurologist did what he could to quell her angry outbursts. The day after her husband mashed up an anti-psychotic into her pureed food, she leaned to one side like a felled tree and her armed curled like a broken branch. Her husband thought maybe she had a stroke and called an ambulance. This turn of events — the emergency room doctors took her off all medications and she was left in a bed for 36-hours waiting for a brain scan that finally, unsurprisingly, showed no evidence of a stroke — was the beginning of the journey through a maze of mirrors as her family navigated the insurance world to get her the help she so desperately needed.

Since this is a story about the minefield of the insurance world, telling the stories of patients and their families and opening the back door to this complex system should help families begin planning early enough to save the stress and pain of a system that is not intuitive at all. But there are lots of people out there — professionals at organizations like the Alzheimer’s Association and social services and legal agencies who work with families every day. Their insights into this process will prove invaluable as you begin to think about what your needs are and perhaps what you might not be able to see coming down the road as your disease or your family member progresses.

Kathleen’s family understood they no longer had a choice to keep her home. She would try to eat anything in her reach. Napkins. A rose. Towels. Her anger was still hot like burned coal. Memories of her family seemed lost. A neurologist recommended she be sent to a psychiatric hospital so doctors could safely figure out the mix of medicine that might help. Six weeks later, the medical bill was reaching $100,000 and she was no better. And now, because she had spent the better part of the day and night in bed, Kathleen could no longer walk.

Social workers at the psychiatric hospital told the family she needed a nursing home. But when the family began visiting facilities one of the first questions was whether Kathleen had Medicaid. If not, they said, the family was looking at paying around $12,000 a month. While people who pay taxes are entitled to Medicare at 65, this federal insurance plan covers a lot of medical care but does not reimburse for long-term nursing care. Medicaid, on the other hand, is a program for people who don’t make enough money to pay for medical care and this system also has provisions in place for long-term care. There is a complicated formula and people have to meet specific financial requirements or have high enough medical bills that could not possibly be paid for with their savings.

One of Kathleen’s daughters was handed the name of a Medicaid consultant at Senior Solutions in Jericho, Long Island. To qualify for an institutional Medicaid benefit, the family was required to make copies of every monthly banking statement for the last five years and provide detailed financial information on their home mortgage, pension and life insurance policies. That Kathleen has a husband adds a significant layer of complexity, as you will see. While the family was maneuvering through the obstacle course of Medicaid applications, they still had to find a nursing home that would take her. Now, Kathleen was even more agitated. Dementia and aggression — and the stint on a psych ward — were a tough sell for nursing homes. A dozen places turned her down. They were told it was hard placing her directly from a psychiatric hospital but if they brought her home, even for a few days, finding a bed in a nursing home would be downright impossible.

Even with the help of a consultant, Louis Torelli, Kathleen’s husband, would come face to face with a federal formula that basically excavated the family finances. To qualify for Medicaid meant the couple needed to get their life savings down below $109,000. If an Alzheimer’s patient no longer has a living spouse, the family savings takes an even bigger hit.

Sidney Schmukler is 96-years-old and has survived three heart attacks, triple bypass and angioplasty.

Sidney and his wife Rose moved from New York to Florida. But it was only when his mind started slipping in 2007 that his children decided their parents should move back to New York. Two years later, his wife died and their children decided to apply for Medicaid home care so they could pay for an aide to assist him with daily activities. Betty Shaffer, Sidney’s daughter, followed the instructions of the Community Medicaid application and the government insurance program sent a nurse to the home. The visit was to determine the needs of the patient to see whether he would qualify for Medicaid assistance.

Sid told the nurse he did not like to shower, that the water felt too cold. Then, the nurse took an alternative course and started asking him whether he was afraid because there were snakes in the shower. “It was bizarre,” Betty recalled. The siblings listened but stopped trying to make a case for their father because they did not want to antagonize her. A few weeks later, they heard their father did fit the profile for home care assistance but he was denied because of a $25,000 insurance policy. This was a Veteran’s insurance policy he received following his service in World War II.

Sid’s grown children pooled family resources to pay the $1,000 weekly cost of part-time help at home. He cashed in his insurance policy and the family waited out the 30-day window and reapplied for Community Medicaid coverage. But it was within this waiting period in April 2010 that Sid was hospitalized with an infection in the tissue surrounding his pacemaker. His cognitive problems were getting worse by the day. The family decided he was too ill to be at home and applied for a different Medicaid program, specific for long-term nursing home care. This time, they hired an attorney who specialized in elder care law. To qualify, they would have to get Sid’s total assets down to $13,800. But before they could even apply for the Medicaid program they had to pay down $30,000 for two months at the nursing home.

In November, with his life savings now well under the $13,800, the nursing home accepted him into a new fold: that of someone who is Medicaid pending. His Social Security check — $1,700 a month — would be handed over to the nursing home. Medicare pays part of the cost — the first 100 days of rehabilitation. When he is Medicaid approved, which could take six months or longer, the nursing home will get paid in full for his care. And Sid Schmukler, a man who owned a successful company that made and sold leather craft kits, gets to keep $50 a month from his Social Security check.

“There were potholes all along the way,” said his daughter, Betty. “If we hadn’t gone to an elder care attorney it would have delayed things even more.”

So What Is a Family To Do?

“The key to long-term planning for your loved one with Alzheimer’s disease is to understand what your needs are today and five years from now,” said Matt Kudish, LMSW, vice president and director of education, outreach and caregiver services at the New York City Chapter of the Alzheimer’s Association. “There is so much to know, even for professionals navigating this system. The Alzheimer’s Association has programs in place to help families get the care they need. Families are often dealing with the emotional burden of an Alzheimer’s diagnosis and the legal/financial end of things adds a lot more stress to the situation. The New York City Chapter has social workers on staff to help identify the individual’s needs and advise people how to proceed with filing the right applications. Oftentimes, families need support groups before they can take on the legal and financial issues,” Kudish explained. Probably one of the first things families need to do on the heels of a diagnosis of Alzheimer’s disease is to have an open,honest and yes, difficult talk with their family member about how he or she wants to live once the disease robs them of their ability to make their own choices. This talk can be guided by the three most important documents that a person of any age should have: Advance Directives include a Power of Attorney, a Living Will and a Health Care Proxy. With this specific information in place, a family will know for certain what they can medically and legally do to protect a loved one, said Kudish.

It is extremely costly to care for a person with Alzheimer’s disease and as you can see the system is such that the family must often take a financial hit to qualify for federal assistance. Many people believe Medicare will pick up the tab for nursing assistance at home or in a long-term care facility but that is not the case. If the family wants to apply for long-term home care services they often have to look to the Medicaid programs for help. Qualifying for long-term care at home is tricky. Medicaid will pay for aides to help take care of someone with medical issues, but generally speaking, the program does not recognize cognitive problems as a reason to approve paying for home health aides.

Alzheimer’s experts recommend hiring a geriatric care manager to meet with the patient in their home to get to know their specific needs, well before the call to Medicaid. The care managers can also be present during the Medicaid evaluation. The care manager will know what to tell the evaluator to increase the chances of the application going through.

Many families caring for Alzheimer’s patients at home bear the burden of the costs for nursing help. There are also many community programs that offer high-level care for
Alzheimer’s patients and also provide a respite for round-the-clock care, which can be exhausting. “Many people benefit from community-based programs,” said Rebecca Carel, a licensed social worker and executive director of Riverstone Senior Life Services. The organization offers a range of programs for Alzheimer’s patients, from a Memory Club for people in the early stages of the disease to community care giving programs that provide exercise and activities to keep people active and focused. The Memory Club is a flat daily fee of $40.00 while the community care giving programs can range from $30 to $80 for a five-hour day, depending on the financial resources of the individual. “We think it’s important to keep people engaged,” said Carel.

As the disease progresses and the needs of the patient increase, many families are faced with the issue of a longterm placement. Amy Torres, the residential care specialist at the New York City Chapter of the Alzheimer’s Association, works with individuals and families to figure out what their needs are. She sees everyday how life for the Alzheimer’s patient can dramatically change and leave caregivers unprepared to take the next and often final step of placing their family member in a long-term care facility. “You don’t stop being a caregiver after a relative goes in to a nursing facility,” she said. Torres advises people to choose a nursing home close enough to make the commute easier. Also, find a nursing home that specializes in dementia care.

Each step along the way, organizations like the Alzheimer’s Association can help overcome the legal and financial hurdles. “It’s hard work to figure out what a person can qualify for,” said Laura Federico, a licensed social worker and care consultant who works with Torres and Kudish at the New York City Chapter. “There are ways to transfer assets and help people become eligible but it takes long-term planning and should be done early in the disease process.” The Chapter provides courses facilitated by several elder law attorneys. The lawyers go over the income and asset liabilities and talk about how to transfer money out of the individual’s name to qualify for Medicaid programs. Sometimes, long-term care insurance policies will cover such home care but each policy is different so families need to know precisely what the insurance will cover. “A lot of people are shocked when they hear how much it costs to get care for their loved one,” Laura explained. “The costs are prohibitive.”

Navigating Nursing Home Placement

If a family has not done their financial and legal homework and the patient has assets and needs longterm nursing home placement there could be a hefty penalty. There is no penalty for transferring assets when applying for community Medicaid programs. But for nursing home placement, Medicaid requires a lookback at the last five years of banking statements. There is a transfer penalty for an individual who turned over their assets to relatives during this five-year window. For example, a nursing home will require that the family add up the individual’s assets that were transferred in the last five years and divide by roughly $10,000 (about the average monthly cost of the nursing home) and that will provide a number for how many months the individual has to pay privately for their care before Medicaid will cover the cost of the care. If it is 10 months that would mean that the person had transferred $100,000 in assets. Once they have passed this point, and their $100,000 is spent on care at the facility, the person is eligible to fill out the Medicaid institutional forms. The patient will no longer have to pay, no matter how long it takes for the application to be approved. The nursing home will reclaim their costs retroactive to the month that the personal checks stop.

In New York, Medicaid policy includes a provision for couples called Spousal Refusal. This allows a patient to apply for Medicaid and protects the spouse up to a certain amount, around $109,000. This might not be enough for healthy people to continue supporting themselves for the rest of their lives, and this is another critical reason why people have to get assets out of their names early enough to protect their loved ones. Spousal Refusal is exactly what it sounds like: A spouse is saying they can’t afford to pay for their loved one’s care. By legal mandate, Medicaid must adhere to this but the agency can revisit this decision and say that the spouse must contribute something to the care of their loved one.

A patient without a spouse can keep around $13,000 of his/ her life savings.

Lisa Giordano, Katherine’s daughter, is relieved the family has made it through the financial minefield and can focus on the main goal of making her mother comfortable. The families shared their stories with hopes that their struggles with the complex and fragmented system can lend insight into what to do to ease your journey. The Alzheimer’s Association New York City Chapter 24-hour Helpline, where families can get help with emotional, legal and financial issues around the clock 365 days a year, can be reached at 800-272-3900. Families can also make an appointment with a care consultant who can walk with you through the process. “It is so important to plan for the expected and the unexpected,” Giordano said. “Now, we can just be with mom and not worry about these other issues.”