PACE (LIFE) Program Regulations Being Updated

PACE is a Medicare and Medicaid funded program that provides comprehensive medical and social services to enable older adults to live in the community instead of a nursing home. Pennsylvania has been a national leader in promoting the PACE concept.

On a national level, the program is referred to as PACE (Program of All-inclusive Care for the Elderly). But that name was changed in Pennsylvania to avoid confusion with our state pharmaceutical assistance program. In Pennsylvania PACE programs are generally referred to as LIFE (Living Independently For Elders).

Despite being in existence for decades the PACE concept has been relatively slow to grow. Currently about 38,000 older adults are enrolled in 120 PACE organizations in 31 states. Legislators have been encouraging the Centers for Medicare & Medicaid Services (CMS) to update the program in order to increase the use of what is seen as more cost effective and desirable home based care. See Lawmakers Push for Sweeping Changes to PACE Program.  

Now, CMS is proposing a rule to update and modernize the PACE program. It is the first update in ten years. The rule was published today (August 16, 2016) in the Federal Register.

The proposed rule is intended to modernize the program, improve care to beneficiaries, and expand the program. In order to expand access to PACE, CMS is proposing a number flexibilities including allowing non-physician primary care practitioners to provide some services in the place of primary care physicians.

For more information on the PACE (LIFE) program in Pennsylvania see my prior article Frail older adults can stay at home with LIFE program’s help.

I have reproduced a list of the LIFE programs currently operating in Pennsylvania below. In you live in another state to find a PACE program near you visit the PACE Program Finder here.

Pennsylvania PACE (LIFE) programs:  

Albright LIFE Lancaster
417 W. Frederick St.
Lancaster, Pennsylvania
+1 717 381 4320

Albright LIFE Lebanon
113 S. Ninth Street
Lebanon, Pennsylvania
+1 717 376 1133

Albright LIFE Williamsport
901 Memorial Avenue
Williamsport, Pennsylvania
+1 570 322 5433

Community LIFE
2400 Ardmore Blvd.
Suite 700
Pittsburgh, Pennsylvania
+1 412 436 1320

LIFE - NWPA
Erie, Pennsylvania

LIFE - Pittsburgh
681 Andersen Drive
Pittsburgh, Pennsylvania
+1 412 388 8042

LIFE Beaver County
Aliquippa, Pennsylvania
+1 724 378 5400

LIFE Butler County
Butler, Pennsylvania
+1 724 287 5433

LIFE Geisinger - IHM Center
Scranton, Pennsylvania
+1 800 395 8759
mchastie@geisinger.edu

LIFE Geisinger - Roosevelt Court Center
Kulpmont, Pennsylvania
+1 866 230 6465
dpcarr@geisinger.edu

LIFE Lawrence County
New Castle, Pennsylvania
+1 724 657 8800

LIFE Lutheran Services, Inc.
Chambersburg, Pennsylvania
+1 717 264 5433
info@lifelutheranservices.org

LIFE St. Mary
Trevose, Pennsylvania
+1 267 991 7600
MLeib@stmaryhealthcare.org

Mercy LIFE
Philadelphia, Pennsylvania
+1 215 339 4747

Mercy LIFE - West Philadelphia
Philadelphia, Pennsylvania
+1 215 573 7200

Mercy LIFE Sharon Hill
Sharon Hill, Pennsylvania
+1 215 339 4747

Mercy LIFE Valley View
Elwyn, Pennsylvania
+1 215 339 4747

NewCourtland LIFE
Philadelphia, Pennsylvania
+1 267 335 1500

PACE Armstrong County
115 Nolte Drive Extension
Kittanning, Pennsylvania
+1 724 545 8000
Julie.pella@lutheranseniorlife.org

Senior LIFE Ebensburg
429 Manor Drive
Edensburg, Pennsylvania
+1 814 472 6060
info@seniorlifepa.com

Senior LIFE Johnstown
401 Broad St.
Johnstown, Pennsylvania
+1 877 998 5433
info@seniorLIFEpa.com

Senior LIFE Uniontown
89 West Fayette St.
Uniontown, Pennsylvania
+1 877 998 5433
info@seniorlifepa.com

Senior LIFE Washington
2114 North Franklin Drive
Washington, Pennsylvania
+1 877 998 5433
info@seniorlifepa.com

Senior LIFE York
1500 Memory Lane Ext.
York, Pennsylvania
+1 877 998 5433
info@seniorlifepa.com

SeniorLIFE Greensburg
123 Triangle Drive
Greensburg, Pennsylvania
+1 724 838 8300
info@seniorlifepa.com

SeniorLIFE Lehigh Valley
Bethlehem, Pennsylvania
+1 610 954 5433

SpiriTrust Luthern LIFE
840 Fifth Avenue
Chambersburg, Pennsylvania
+1 800 840 9081

Medicaid Estate Recovery and How to Avoid it

It is a reality of aging. If we live long enough most of us will eventually have a chronic condition or illness that limits our ability to do some basic tasks. We may need help with household chores, shopping, money management, medications or transportation. Or we may need assistance with so-called "activities of daily living" such as eating, bathing, dressing, toileting, and walking.

When that happens, we will need help to accomplish the tasks. That type of personal assistance is commonly referred to as “long-term care” (or as “long-term services as supports”).

Alzheimer’s disease is one of the main culprits. According to the Alzheimer’s Association, one in nine people age 65 and older (11 percent) has Alzheimer’s disease, and nearly one-third of people age 85 and older (32 percent) have Alzheimer’s. The likelihood of developing Alzheimer’s doubles about every five years after age 65. “Because Alzheimer’s disease is underdiagnosed, half of the estimated 5.3 million Americans with Alzheimer’s may not have been told by a physician that they have it.”

Of course, Alzheimer’s is only one of the reasons that a majority of older adults eventually need long term care. According to the U.S. Department of Health and Human Services two-thirds of people 65 or older will someday need long-term care assistance either at home, in an assisted living type facility, or in a skilled nursing home. Over 40 percent will need care in an expensive nursing home for at least some period of time. Currently the average monthly cost of a semi-private nursing home room in PA is over $9,000. Care at home is also expensive – with a $4,109 average monthly cost for a home health aide.    

Despite the likelihood that we will need long term care someday, older adults typically fail to plan for it. This failure to plan in advance can be devastating when a care crisis does arise. It can place an unnecessary extra financial, physical, and emotional burden on our families.

Have you planned for the likelihood that you will need long term care someday?  

One of the factors to consider when you do plan is a program called Medicaid Estate Recovery. Estate recovery is one of the problems that can be minimized or totally avoided by adequate advance planning. In the remainder of this article, I want to discuss how this can work.

The Medicaid Estate Recovery Problem

Many of us will be unable to afford to pay for the long term care we are likely to need as we age. Certainly few families can pay $100,000 a year or more to a nursing home. Fortunately, when you run out of money to pay for nursing home care, the government Medicaid program will usually pay. 

Since both nursing homes and home care are so expensive, many care recipients do eventually run out of money and end up relying on Medicaid benefits. But, when you die, Medicaid expects to be repaid for the money it spent on your nursing home or other long term care. This repayment requirement is enforced through the Medicaid Estate Recovery program.

Medicaid Estate Recovery is real and it’s a serious problem. In 2015 the Pennsylvania Department of Human Services opened 7,148 Medicaid Estate Recovery cases against the assets of deceased Pennsylvania residents.  The Government recovered tens of millions of dollars, most of it from the sale of homes.

Most people want their home to go to their children or other family when they die, not to the government. But Medicaid Estate Recovery can force your home to be sold to pay the government back.

Is there anything you can do to protect your home from being lost if you end up needing long term care?

Finally, I have some good news: with expert planning, especially if you plan in advance, seniors can ensure that their homes will stay in the family after their deaths and not be lost to estate recovery.

There are a number of different planning options that people are using to protect their homes from the Medicaid Estate Recovery Program. This article will discuss an option that is available to people who have the wisdom to plan in advance. It can be used to protect your home and other assets, including investments, for your spouse, children or other heirs after your death. Let’s call this planning option The Home Protection Trust.

Trust has Advantages over Giving your Home to your Children

Medicaid Estate Recovery forces the sale of things, like your home, that you own when you die. So one way people try to avoid the recovery program is to give things away before they die.For example, parents sometimes try to protect their homes from nursing home costs and estate recovery by giving the home outright to their children. They plan to rely on their children to “do the right thing.”

While this strategy may ultimately protect the home from Medicaid Estate Recovery, it carries many risks. It’s not as simple as it seems. One problem is that deeding your home to your children will make you ineligible for Medicaid for a long period of time. You may have no way to pay for the care that you need during the penalty period. And in Pennsylvania, under our State’s filial responsibility laws, a nursing home, hospital or other care provider can then sue your children. You children can become personally responsible to pay for the costs of your care. (For more on how this works see my prior article: Law can require children to pay support for aging parents.)

Deeding your home to your children can also have significant tax disadvantages, and can put you at risk of losing your home in the event your child predeceases you or runs into financial or marital problems. More than once I’ve been consulted by a client who regretted having given their home to their child and ending up with their son-in-law or daughter-in-law as their landlord.      

Usually, a better option is to deed the home so that it is owned by a trust rather than being owned by a child. [The term “trust” describes the holding of title to a property by a trustee (one or more individuals or a trust company) in accordance with the provisions you create in a written trust instrument.] 

Using a special kind of trust, your property can be protected from estate recovery when you die, even if you have a long stay in the nursing home. And since your child is not the owner of the property it is protected from any bad things that may happen in your child’s life as well.  

A trust allows you to protect your real estate (and other assets if you wish) from long term care costs while avoiding the risks and negative consequences of outright transfers to children. By transferring your home and other assets into a properly designed trust, you can still reserve an interest in and some control over the transferred assets – advantages that are not available when transfers are made outright to a child.

For example, the trust can provide that you have the right to reside in the home for the rest of your lifetime.  No one can throw you out or ask you to pay rent.  You still own the home for tax purposes, so you can still deduct the taxes, and claim any property tax rebates. You can claim the residential exclusion from income tax if the property is sold during your lifetime. And your heirs can get a step up in tax basis if the property is sold after you die (which can limit or avoid any income taxes they might otherwise have to pay). 

The Trust Can Protect More than just your Home

Investments, such as stocks, bonds, bank accounts, and life insurance policies are also commonly protected through the use of this special form of trust. Because more than just your home can be protected this type of trust is given different names. You will hear elder law lawyers sometimes refer to it as a “Family Asset Protection Trust,” or as an “Irrevocable Income only Trust (IIOT),” or as a “Medicaid Trust.”

Who Can Be Trustee?

People often name one or more of their children as trustees - this is kind of like naming someone in a power of attorney or an executor in a Will - the trustee doesn’t personally own the assets of the trust, they just manage them according to the terms you set up in the trust. 

While most people name one or more family members as the trustee, you can also name a professional trustee like a bank. A professional trustee can offer professional management of the investments held by the trust. In any event, you can include a provision in your trust that allows you to fire the trustee and appoint a new one at any time.

This is Not your standard Revocable Living Trust

It’s important to note that a Home Protection Trust is very different than the standard revocable “living trust” that many people hear about. A revocable living trust does not protect your assets from nursing home and other long term care costs. The Home Protection Trust is an irrevocable trust specifically designed to protect its holdings from loss if you ever have to apply for Medicaid to pay for your long term care costs.   

When you transfer the things you want to protect to the trust you don’t have to sell them. You don’t have to change your investments.  What you own now is merely moved under the protective umbrella of the trust.  The trust can sell things held by it, and buy new things. If your home is held under the trust, and you need to move, the trust can sell it and buy a new one.

I created many of these trusts for my clients, including some members of my own family, over more than twenty years. Most people don’t even notice the trust once it has been set up.  It changes things just enough to protect your assets from nursing home costs, from issues with your children, and from the risks involved when a surviving spouse remarries.  

Planning in Advance. 

Because the Home Protection Trust involves the transfer of property for Medicaid purposes, Medicaid’s five year look back period rule on transfers applies. This means that it is best if you can create and fund your trust at least five years before either you or your spouse are likely to need to apply for Medicaid.

In general, you have many more options if you plan well ahead of any illness. Don’t wait for a crisis to happen.  With expert advice you can still plan and protect some assets even after a crisis has hit. But because of the Medicaid five year rule regarding transfers of assets, many more options are available when you plan well in advance of any need for Medicaid.  The time to plan is now!

The Home Protection Trust is only one of several techniques experienced elder law attorneys use to help their clients keep the home in the family and out of the hands of the government. Other strategies include transfers between spouses, life estate deeds, and transfers to a caregiver child.

Don’t Try this without Expert Help from an Elder Law Attorney who knows the laws in your State

The planning that will work best for you will depend upon your particular situation and the laws of your state. If you are concerned that your family home will be lost because of the overwhelming costs associated with Alzheimer’s, other dementia, Parkinson’s, stroke or another disabling condition, see an experienced elder law attorney in your state soon. The laws regarding Medicaid and Estate Recovery differ from state to state – you need to get expert advice from a lawyer who knows the laws of the state where you live.  

If you live in Pennsylvania, you can meet with one of the Medicaid Estate Recovery experts at the law firm of Marshall, Parker and Weber. That’s a good way to learn about the options available to you. 

Documenting Your Wishes with Advance Directives

Advance care planning is a process through which you consider your personal values about medical treatment and the care you want to receive at the end of life, discuss those values with your family and others close to you, and complete documents that record those decisions for the future.  It is the best way to help ensure that your values, wishes, and choices will always be known and respected. 

The legal tools that document your decisions are called advance directives.  An advance directive is a written or spoken statement you make today to control the health care treatment you will receive in the future. It gives your family and health care providers your directions and decisions about medical care in case you cannot, at some future time, speak for yourself.  In your documents you may name a spokesperson (agent or representative) to make decisions on your behalf. 

With the enactment of Act 79 of 2016 Pennsylvania has recently made minor modifications to its laws regarding advance directives. But the essential elements remain the same. Pennsylvania law recognizes a number of forms of advance directive.

A living will provides treatment instructions regarding the types of medical treatment and care you want to receive or refuse at the end-of-life. This document is typically used by people to describe the point at which they would no longer desire certain types of life-prolonging medical treatment, but it may also document your desire for continuation of treatment.  A living will is a limited document because it is operative only when you have an end-stage medical condition or are permanently unconscious. As a result, living wills apply to only a small fraction of the decisions caregivers must make.

A health care power of attorney appoints a person of your choice to make health-care decisions whenever you are unable to make decisions for yourself. Your spokesperson (agent) can act regardless of whether you are terminally ill or permanently unconscious. You can include your treatment instructions and guidance as to your preferences regarding end-of-life care and other situations that may arise in the document.

An appointment of health care representative designates a person to make health-care decisions for you.  You can make your designation in writing or by personally informing your physician or health care provider of the person or persons you want to act as your representative. You can also specify that certain individuals should be excluded from making decisions concerning your care. 

A mental health advance directive is a written document that expresses your choices for treatment related to mental health care in the event that mental illness makes you unable to make decisions.

There are also several forms of physician orders that may be used to provide advance treatment instructions.  These documents are a unique form of advance directive because they are actual physician treatment orders.

∙           A do-not-resuscitate (DNR) order is a medical order written by a patient's attending physician that directs medical personnel to forgo cardiopulmonary resuscitation (CPR) if the patient's heart or breathing stops. The order, sometimes referred to as a "no code" or "comfort care," is usually placed on the patient's chart.  There are several varieties of DNR orders. The traditional DNR order is given by the doctor of a hospital in-patient directing that resuscitation not be performed in the event that the patient's heart or breathing stops. A second variety of DNR which gives similar instructions for non-institutionalized individuals is the Out of Hospital Do-Not-Resuscitate order. 

∙           A POLST order is standardized form containing physician orders detailing the scope of life-sustaining medical treatment to be provided to a patient. POLST stands for physician-order-for-life-sustaining treatment. 

Creation of an advance directive is an important step in the advance care planning process.  But you should recognize that it is only one step. Your advance directive will not accurately reflect your preferences unless you have taken time to reflect on what is important to you in life and what gives your life meaning. What kinds of situations do you fear facing in the future? Would you ever want to limit certain types of treatment? Do you want to be sure that you will receive certain types of treatment?  Who is the best person to speak for you if you are ever unable to speak for yourself?

If your family is to understand and follow your wishes, they really need to participate with you in your planning.  Family conversation today can spare your family members from the agony of having to make painful decisions in the future without any meaningful guidance about what you would really want.  Important issues can be considered while there is time for reflection and discussion.

By planning in advance you can provide your family and other care givers with the information they will need to make the most appropriate decisions for you.  They won't have to guess what you would want.  All too often families are forced to make medical decisions for a loved one during a crisis while under great emotional stress. Studies of close family members show that they do not automatically know each other’s wishes even under the best of conditions. Spouses very often guess wrong about what kind of treatment their husband or wife would want. The more your family knows, they less they will have to guess and disagree and argue.

Effective advance care planning is a blessing you can bestow on yourself and the people closest to you.  A crisis situation may not give you the opportunity to discuss critical issues with your family.  

The time to plan is now.