Applying for Medicaid (i.e., Medical Assistance) can be like walking into a minefield. There are a number of ways that a Medicaid application can go wrong—and the consequences can be absolutely devastating.
Here are some examples of common problems we see.
1. Nursing Home Mistakes
Sometimes a nursing home files the Medicaid application but doesn’t tell you (the family) the application’s status. That is a problem because then you will have to bear the brunt of the burden if the nursing home makes any mistakes with the application.
The Medicaid application process is extremely time-sensitive. It is not instantaneous, and in fact, it could be several months between when an application is filed and when notice is received of the application’s approval or denial. The problem is that the nursing home bill is accumulating during this entire period of time, at $9,000–$12,000 a month. If in three months the Medicaid application is denied, the next thing you know, you must cough up $36,000 or more for the nursing home’s failed application.
If you do not pay, then the nursing home will start the discharge proceedings for the resident. Worse, if you signed their contract, then the nursing home will come after you personally for the unpaid bill…plus interest…plus attorney fees.
In one of our cases, our client was a nursing home employee, whose mom was a resident at that nursing home. He had trusted his employer (the nursing home) to correctly file the Medicaid application for his mom. Many months later, the Medicaid application failed, and the nursing home gave him a bill for over $100,000. They expected him to pay it immediately or his mother would be discharged!
2. Payments to Relatives
This is another big Medicaid problem. For instance, your mom goes into a nursing home, and an application for Medicaid is made on her behalf. Three months later, the Medicaid case worker denies the application because your mom helped you buy a house. Now there is a big penalty in which the nursing home won’t be paid for months.
Now what happens? The nursing home will begin discharge proceedings, and their attorneys will start looking for ways to get paid. If you signed the contract, they will come after you. If your mom owns a home, they will demand that it be sold. And if you do not comply, then they will file for guardianship to get the court to appoint someone who will sell the home.
3. Surprise Assets
Suppose a Medicaid application is filed for your mother, and you subsequently find a life insurance policy in her name. You report this information to the Medicaid caseworker, as you should, and now, because of this life insurance policy, your mother has excess resources and is denied Medicaid.
But it has been three months since the application was filed, and now the nursing home bill is $30,000–$40,000. As in the previous scenarios, they will threaten to discharge, get their attorneys to go after whoever signed the nursing home contract, and if there is an asset to be sold (i.e., a house) they will either force you to sell it or file for guardianship to get someone else to sell it.
Avoid the Medicaid Minefield
There are several other ways that an application for Medicaid can be denied, leading to absolutely disastrous results. You could find yourself in litigation with the nursing home over their bill, ensnarled in a complex Medicaid appeals process, and fighting in court over who makes decisions for your mother.
All of these are real and possible outcomes to a failed Medicaid application. That is why it is imperative that you have an elder law firm with the expertise behind them to help address these issues head on and avoid the minefield associated with a Medicaid application. Call our office today at (410) 296-8166 x292 for a consultation.