1. The Deficit Reduction Act of 2005 – Selected Features Robert Mollica

2. Key features Money Follows the Person HCBS State plan option Long term care insurance partnerships Consumer direction Asset transfer

3. General framework Is this going to happen in your state? When? How will we know about it? What’s the role for ADRCs? What will we need to know to help consumers?

4. MFP Rebalancing initiative – broader than relocation $1.75 billion over five years Proposals due November 1, 2006 –Possible second round later Provides enhanced match for relocating qualified individuals –50% of the difference between current match and 100%, not to exceed 90% –Match available for 1 year from date of relocation

5. Qualified individuals Must be in an institution at least six months (or up to 2 years at the state’s option) Medicaid beneficiary for at least one month in the institution May serve multiple populations May be statewide or limited areas

6. Qualified residence Home owned or leased by the individual or family Apartment with individual lease, lockable access & egress, living, sleeping, bathing cooking space Residence in community based residential setting with no more than four residents Excludes assisted living 5 or more

7. Phases Pre-implementation –States must submit an operational protocol within 3-12 months –Address target population, participant selection, service delivery plan, quality management system Implementation

8. Other requirements Must have a full time project director Prepare gap analysis Must identify policy and budget barriers and describe steps that will be taken to address them Identify benchmarks – number transitioned, percent spent on HCBS Reporting elements to be determined

9. Requirements Maintenance of effort –Applies statewide and for all LTC expenditures –States may limit the geographic area of the demonstration and the populations served

10. Key questions Will your state apply? Who will be served? What areas of the state will be covered? Who do consumers contact? How will the program be marketed? What role will ADRCs play?

11. HCBS state plan option Covers specific services listed in §1915 (c) May serve individuals who are eligible for Medicaid in the community and have income below 150% of poverty Must set different level of care criteria for NF and HCBS

12. HCBS… May limit the number of individuals served –Establish wait list or change level of care threshold –Grandfather previous enrollees Allows presumptive eligibility for HCBS only (up to 60 days) Participants must receive an independent assessment of functional eligibility and service needs/care plan

13. HCBS …. Option for self-direction Requires an assessment of needs, capabilities and preferences Person centered plan of care Describe methods for selecting, managing and dismissing providers Individual budgets – describe method for determining the dollar value

14. Key questions Regulations due in December Will your state submit a state plan amendment? What services will be covered? How will consumers access services? –Same as for waiver services? Functional eligibility criteria? Role for ADRCs? Will Congress make changes?

15. Cash and Counseling State plan option Can hire legally responsible relative Can waive statewideness and comparability No budget neutrality requirement or extensive reporting under 1115 Assessment and counseling Individual budget Financial Management Service costs reimbursed at administrative rate (50%)

16. Key questions Regulations/guidance due in December Will your state participate? When might the option be available? How will it be implemented? What is the process for informing consumers about the option? Role for ADRCs?

17. Long Term Care Insurance Allows states to submit a state plan amendment to exempt resources with the purchase of a qualified LTC insurance policy Expands the option beyond the existing four states: California, Connecticut, Indiana, New York

18. Qualified policy Certified by insurance commissioner that it meets requirements of the NAIC Model Regulations Agents who sell LTCI must receive training on the relationship to Medicaid Issuers report to HHS on benefits paid, terminations and other items –Regulations to be issued

19. Qualified policies…. Meet IRS definition – Section 7702B(b) Must include inflation protection –< 61 years Compound annual inflation –61-76 yearsSome level of protection –> 76 yearsMay be offered, not required

20. Partnership web sites CA http://www.dhs.ca.gov/cpltc/http://www.dhs.ca.gov/cpltc/ CTwww.opm.state.ct.us/pdpd4/ltc/home.htmwww.opm.state.ct.us/pdpd4/ltc/home.htm IN http://www.in.gov/fssa/iltcphttp://www.in.gov/fssa/iltcp NYhttp://www.nyspltc.orghttp://www.nyspltc.org

21. Key questions Will your state submit a plan amendment? What will be the design of the partnership? When will marketing materials be available? When are policies likely to be available? How will ADRC be informed? Trained? –Joint meetings with agents?

22. Asset transfer Look back period extended to five years Disqualification begins on the date the person applies for Medicaid No partial month transfers Home equity limited to $500,000 –States may raise limit to $750,000 –Hardship provisions SMD letter http://www.cms.hhs.gov/smdl/downloads/TOAEn closure.pdf http://www.cms.hhs.gov/smdl/downloads/TOAEn closure.pdf

23. Assets… Hardship –Transfer allowed if penalty deprives the person of medical care need to maintain health or life –Food, clothing, shelter or other necessities States can combine transfers in more than one month to establish one penalty period Life estates – buyer must reside in the home at least one year following date of purchase

24. Annuities Must disclose interest in an annuity if applying for NF or HCBS May consider income and resources from an annuity Must name the state as a remainder beneficiary

25. Key questions How will the hardship provision work? What information will be available to ADRC staff? Training?