September 15, 2005

LEGISLATIVE UPDATE

It’s hard to believe that the summer is just about over. The kids are back in school and our Legislators are also back to work. Here’s what’s happening this month in the Legislature.

The Committee on Health Care Financing is holding hearings on September 21, 2005 on three of the Bills that I am following.

I. ACT TO PROTECT ASSETS OF THE SPOUSE OF A NURSING HOME RESIDENT – House Bill #1500 and Senate Bill #392 - On January 1, 2003 the Commonwealth cut in half the amount of assets that a married couple may keep if one of them needs nursing home care. In round numbers, currently the spouse of a nursing home resident may keep one-half of their assets, up to about $95,000. This Bill would change this rule to go back to allowing them to keep the 1st $95,000. Under our current rules, if you have $40,000, they say that it is too much. You can only keep half. If this Bill passes, they would be able to keep all of the $40,000. In fact, they could keep up to $95,000, if they had that much.

II. AN ACT TO PREVENT HARSH ASSET TRANSFER PENALTIES - House Bill #2786 (Representative Hynes) and Senate Bill #688 (Senator Creedon) - MassHealth (Medicaid) is a federal law. The Commonwealth is seeking permission to waive certain provisions of the federal law and be allowed to make up their own rules. This Bill affects people who have paid for their grandchildren's college expenses or made gifts to family members and later need nursing home care.

III. AN ACT TO PRESERVE ASSETS OF THE SPOUSE OF A NURSING HOME RESIDENT - House Bill #3911 (Representative Peterson) and Senate Bill #702 (Senator Montigny) - Massachusetts is now an income first state. This Bill would change us back to an asset first state. This Bill affects housewives who stayed home and raised their children instead of working and have placed their husband in a nursing home. These women typically have a very small amount of social security retirement income. Prior to September 1, 2003, if one of these women had to place their spouse in a nursing home, they were allowed to keep some extra assets because their income was so low. The current rule says that they must spend down these excess assets and rely upon an allocation of their husband's income. What happens upon the husband's death? The husband's income probably ceases upon his death and the homemaker wife has now spent most of her money. We now have a housewife that no longer can afford to live in the community because she has spent most of her money and no longer receives an allocation of her husband's income because he is deceased. Many of these women will be forced to sell their home because they cannot afford to live there any longer.

On September 15, 2005 the Elder Affairs Committee will have a hearing on two other Bills that I am following. They are:

I. AN ACT TO INCREASE THE PERSONAL NEEDS ALLOWANCE - House Bill #2892 (Representative Paulson) and Senate Bill #421 (Senator Panagiotakos) - I feel very strongly about this bill. This Bill would increase the amount of money a nursing home resident can keep out of his/her monthly income from $60 to $72.80 per month. Some residents pay about that much per month for just their telephone and cable TV bills. That probably doesn't even leave enough for a haircut!

II. AN ACT TO IMPLEMENT A PROGRAM OF LONG TERM CARE EDUCATION - House Bill #2917 (Representative Balser) - This Bill would require the Executive Office of Elder Affairs to implement a program of public education about long term care, the options available to individuals, and how to plan for long term care needs.

After the hearing, the Elder Affairs Committee will hold an executive session to report out bills that were previously heard. This is not a hearing, rather a decision to report a bill as “ought to pass, ought not to pass or study”. This usually doesn’t include bills heard on the same day, but will probably include the following bill that I am following:

Ø House Bill 1493 (Representative Balser) – This bill would help primarily women, who had to place their husband in a nursing home. Generally, these are women are the ones who stayed at home and raised a family instead of working, and consequently have a low monthly income. They are entitled to an extra asset allowance called the Community Spouse Resource Allowance. Currently the state is imputing interest to the spouse at home at unrealistic interest rates. The end result is that these women are being allotted a smaller allowance.

These hearings are public hearings. I plan to go and testify at either, or both of the hearings. If there are any seniors reading this column who have been hurt by the MassHealth cuts in 2003 and 2004, and would like to accompany me to the hearings to also testify, please let me know. I’d love the company.

This article gives general information and not specific advice on individual matters. Persons wanting individualized advice on matters discussed should contact an advisor experienced in those matters. To the extent this article provides information on legal matters, it is based on law in effect in Massachusetts on the date of posting (laws in effect in other states are often quite different).

Ronald H. Surabian is a CPA and attorney who works at the Elder Law Center in Saugus, Massachusetts. He also holds masters in accounting and a masters in tax law. He currently serves on the board of directors of the Massachusetts Chapter of the National Academy of Elder Law Attorneys. If you have any questions please call me at the Elder Law Center, One Essex Street, Saugus, MA 01906 (781)233-4444. To view this or any prior article, please visit our web site at www.elderlawcenter.org

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