Question: My wife, who had a stroke, was discharged from the hospital to a local nursing home. I thought Medicare would pay for it, but after 23 days, the nursing home told me Medicare is ending because she is not getting better, and I have to either take her home or pay $8,000 per month to keep her there.
I don’t think I can take care of her at home. Should I appeal the Medicare decision? Should I look at Medicaid?
Answer: Your situation is not unlike others I have encountered over the years. Many of us think that we’ve adequately prepared for the unexpected medical or life transition and have the coverage to see us through. Unfortunately, Medicare’s skilled nursing home benefit is very limited.
If a hospital discharges a patient to skilled care after a three-day admission (not observation status), Medicare will only pay in full for the first 20 days. For another 80 days, coverage may continue, but there is a copayment of $164.50 per day.
Thus the patient responsibility for days 21-100 can add up to $13,160. A supplemental insurance policy may cover some or all of the copayment for days 21-100. After 100 days, Medicare coverage ends, and as you’ve experienced with your wife, the cost of providing private pay skilled care becomes the patient’s responsibility.
Many nursing homes are reluctant to continue to bill Medicare in a situation like your wife’s, or when a patient has severe Alzheimer’s, because they believe that Medicare coverage is linked to the patient’s restoration potential. Often a nursing home will say that Medicare will no longer pay because their resident “is not getting better.”
For stroke patients like your wife, physical therapy progress may be slow or hard to monitor. But Medicare does not in fact require the patient to be showing improvement. Medicare will pay if skilled therapy services are necessary to “maintain the patient’s current condition or prevent or slow further deterioration.”
You should have received a written notice from the nursing home at least two days prior to the time Medicare is scheduled to end. If you did not receive a “Notice of Medicare Non-Coverage,” the facility should not bill you privately for the services.
The notice provides information about how to request a fast appeal. You have to make the request by noon the day after you receive the notice, after which the nursing home must give you a “Detailed Explanation of Non-Coverage,” which cites the applicable Medicare rule or policy and explains why services will not be covered. You can submit additional information (typically a physician assessment), and the NC Quality Improvement Organization will render a decision within 72 hours.
However, if they determine that services are correctly terminated, you will have to pay privately from the date of the termination notice. There are other levels of appeal, but you will have to pay privately while you pursue those, and the total amount you might get covered if you are successful is the private pay rate for 77 days, or approximately $20,000.
It might be better to focus on Medicaid coverage as it sounds like your wife may need long-term care beyond the 100 Medicare days. It would be possible to obtain Medicaid coverage for her if she has less than $2,000 of countable asset in her name. Some assets do not count, including your residence, small life insurance policies and co-tenancy real estate. All monetary assets owned by either of you are considered, but there are spousal allowances which would make it possible for her to qualify without your having to impoverish yourself.
You would be allowed to keep half of the monetary assets, with a minimum of $23,000 and a maximum of $120,000. If you have monetary assets over these limits, it would be possible to structure them so that you can retain amounts over $120,000.
For instance, if you and your wife have $300,000, you would be able to keep $120,000 in cash, and you could purchase, in your name, an immediate irrevocable annuity which pays you the remaining $180,000 in equal monthly installments over a period of time not longer than your life expectancy.
To explore these and other options unique to your situation, I recommend consulting with a qualified elder law attorney. They can assist with Medicaid spend down and the application process.
---Attorney Caroline Knox