Long Term Care Planning / ALTCS

We provide legal and financial advice to our clients that are faced with the overwhelming cost of institutional or community-based long term care. Many of our clients cannot afford to privately pay for long term care and cannot obtain long term care insurance, yet have too much money to qualify for public benefits through Arizona’s Medicaid program, the Arizona Long Term Care System (ALTCS). Utilizing legal and financial strategies, we formulate a personalized long term care plan for our clients at a comprehensive initial consultation in order to assist them with preserving their assets while qualifying for government assistance.  We have staff available to prepare and process the ALTCS application for our clients.

2017 ALTCS Summary

Why does Arizona have ALTCS instead of Medicaid?

Medicaid is a joint federal-state program. In 1981, the Arizona legislature approved and funded the Arizona Health Care Cost Containment System, (AHCCCS), as a prepaid, capitated managed care demonstration project under Medicaid. In 1989, Arizona Long Term Care System (ALTCS), a division of AHCCCS, was implemented offering long term care, acute care and home and community based services to the elderly or physically disabled and developmentally disabled residents of Arizona. Though the names are different, it is correct to say that ALTCS is Arizona’s version of Medicaid.

What are the eligibility requirements for ALTCS?

There are both medical and financial eligibility requirements for ALTCS.

1. Medical Eligibility: to be medically eligible, an applicant must have a medical need for long term care services and be at risk of institutionalization. This means that the applicant must be in need of long term care at a level comparable to that provided in a nursing facility, but at a level which is below that of an acute care setting (hospitalization or intense rehabilitation) and above the level of care of a supervisory/personal care setting (intermittent outpatient medical intervention or benevolent oversight.)

An individual who meets ALTCS criteria will present with one or more of the following needs and impairments:

  • Requires nursing care by or under the supervisor of a nurse on a daily basis
  • Requires regular medical monitoring
  • Exhibits impaired cognitive functioning
  • Exhibits impaired self-care with activities of daily living
  • Exhibits impaired continence
  • Displays psychosocial deficits

 

2. Financial Eligibility: ALTCS looks at both the income and the resources of an applicant.

For a single person, his/her gross income cannot exceed $2,205 per month. For a married couple, the total income of both spouses cannot exceed $4,410 per month, OR, b) the total income received by the applicant under their name as well as half of the income received in checks made out jointly in both names cannot exceed $2,205.

The ALTCS resource limit for a single person in $2,000. For a married couple, the applicant’s spouse may retain half of the countable resources of both spouses, except the half retained cannot exceed the maximum of $120,900, and the spouse may keep a minimum of $23,844, even if half is less than $24,180. In addition to the half that the spouse retains, the applicant is still permitted to retain $2,000 Under most circumstances, if both spouses in a marriage are applicants, then each is limited to $2,000 in resources.

The resources and income for both spouses are considered, regardless of community property laws, prenuptial agreements, or the nature of the ownership of the asset.

Certain resources, such as your home and one car, are not counted for eligibility purposes.

Do I have to requalify every year?

Yes. Every twelve months, ALTCS re-determines financial and medical eligibility for the program. This process is called the renewal.

Will ALTCS take the recipient's Social Security income while he/she is receiving benefits?

Many people believe once someone is eligible for ALTCS the state becomes the payee of their Social Security check. This is not the case; however, if  someone is found eligible for ALTCS, they must pay an amount towards the cost of their long term care expenses. The portion that they pay is called either “Share of Cost” or “Room and Board” depending on the type of facility where they are living. Share of Cost and Room and Board are based upon the client’s income. ALTCS allows certain expenses to be deducted from Share of Cost. The ALTCS recipient continues to receive their Social Security check and then every month may have to write a check to the nursing home or facility for their Share of Cost or Room and Board if it is required. People who live at home are not required to pay share of cost or room and board.

If the proposed recipient receives ALTCS benefits, will ALTCS take the recipient's house after he/she dies?

The state of Arizona is federally mandated to recover the cost it paid on behalf of an ALTCS recipient who was 55 years of age or older when the recipient received ALTCS nursing home or home and community based services.The assets against which recovery is sought must be part of the probate estate if it is required to be administered through a court process. ALTCS will only recover against the probate estate as defined by Arizona law and will not recover against joint tenancy property, life insurance proceeds or designated beneficiaries on pension plans or IRAs. Additionally, if the recipient’s spouse or certain other family members reside in the home, the state will not initiate a recovery.  Under certain circumstances, an undue hardship waiver can be requested. However, if someone is in a nursing facility for 90 days are more and is not expected to return home, the state may place a lien on their home for the amount paid for the recipient’s care. There are available planning strategies that are utilized by Elder Law attorneys to try to protect the family home from estate recovery by ALTCS.

Can my parents give away all of their assets in order to qualify for ALTCS?

An applicant for ALTCS must disclose all uncompensated transfers (gifts) that have been made during the 60 months prior to the date of application. ALTCS then calculates a period of ineligibility by dividing the total amount transferred by the average monthly cost of care in the county. The resulting figure represents the months of ineligibility for series. The remaining fraction is then multiplied by 30. The resulting figure represents the additional number of days of ineligibility. The period of ineligibility runs from the date of the transfer. Transfers are treated differently depending on the date the transfer was made and when the ALTCS application is filed.

Strategies for Preserving Assets

Strategies for preserving assets include creation of an “income only trust” which allows an individual whose income exceeds the monthly ALTCS limit to still quality for the program.

A trust for a disabled person under the age of 65 can protect that person’s assets while ensuring eligibility for ALTCS or SSI benefits. For adults over the age of 65, transfers can be made to an irrevocable trust, which permits eligibility after a waiting period.

The purchase of a single premium annuity can be an effective strategy for preserving assets while qualifying for ALTCS benefits, particularly for a married applicant.