The requirements imposed upon individuals seeking Medicaid benefits to pay nursing home costs have become less onerous in recent years. For many years, Medicaid applicants were required to submit monthly statements for every bank and investment account for every one of the 60 months preceding the filing of the Medicaid application. Under that regime, someone with only 4 bank accounts would have to submit 240 individual account statements. Then, once those statements were submitted, they were reviewed by a Medicaid caseworker who was on the lookout for any “questionable” transactions.
“Questionable” transactions include unexplained deposits and substantial expenditures. Therefore, unless the source is obvious from the account statement, any deposit showing up on those 240 statements would be questioned by the Medicaid caseworker seeking to ascertain the source of the funds deposited, and any payment of $1,000 or more likewise would be called into question. The problem is magnified if the applicant or the applicant’s spouse had any additional bank or investment accounts.
That being the case, in order to be prepared to address a Medicaid caseworker’s questions, lawyers assisting Medicaid applicants under the old system would review all of the bank statements and seek explanations from the applicant or applicant’s family for any transactions that likely would be questioned. That process could be time consuming, and, if the law firm performing such review billed the client on an hourly basis, then the legal fees to pursue the Medicaid application would be high.
In recent years, however, the Medicaid application process has been streamlined. No longer is a Medicaid applicant required to submit 60 individual account statements for each of the 60 months preceding the month the Medicaid application is filed. Now, applicants need only submit a few statements for the most recent months, and then a single statement for a particular month for each of the preceding five years. Hence, under current practice, rather than submitting 60 statements for each account, an applicant only has to submit 8 statements, and it is only those 8 statements that will be scrutinized by the Medicaid caseworker. Thus, for a Medicaid applicant with four accounts, the number of statements needed to be submitted for scrutiny was reduced from 240 to 32.
If one were to continue to operate under the old system and submit 60 monthly statements for each account, and then spend the time to closely scrutinize each of those statements and any transactions that might be called into question, then such person would be doing extra work for little or no added benefit.