Republicans target middle class seniors for budget cuts
From the Courier-Post On-line:
On Feb. 1, the House of Representatives will vote on a controversiallaw affecting most U.S. senior citizens. The proposed law, referred toas the Deficit Reduction Act of 2005, would create a complete overhaulof our Medicaid system with respect to assets and nursing home care.
Under current law, gifts provided beyond three years of the Medicaidapplication are allowed. Under the proposed law, states will berequired to look back five years to determine if gifts were provided.For example, if an elderly parent gave a gift to a child 59 months ago,the Medicaid application will be denied under this new law. Also underthe proposed law, our senior citizens would have to produce five year’sworth of financial records before a Medicaid application could beapproved.
According to current Medicaid laws, a person can gift a small portionof his or her life savings to family members and still qualify forMedicaid. The exact amount that can be protected is based on the valueof the estate, the amount of the gift and when the gifts were provided.
The proposed law would not allow any gifts of any amount during theprevious five years. Therefore, if a mother transferred $11,000 to herdaughter in 2001 and 2002, she would not be able to qualify forMedicaid at this time, even though she has no assets. She would bedenied Medicaid for a period of time in 2006. Under the current law,these small gifts provided in 2001 and 2002 would have no relevancy tothe Medicaid application today.
The proposed law would make it difficult for senior citizens to protecttheir life savings and assets for the benefit of their families in theevent they require nursing home care. Under current law, there existslegal methods to protect a portion of the assets from the catastrophiccost of nursing home care that can easily exceed $100,000 a year. Underthe proposed law, most senior citizens would not be able to protecteven a small portion of their life savings for their family.
The proposed law would create undue hardship on families if a parent orspouse requires nursing home care. The proposed law affects the use ofannuities, the protection of assets for a healthier spouse and, in manycases, a home will no longer be protected if the equity exceeds acertain amount.
The proposed law barely was approved by the Senate on Dec. 21. Vice President Dick Cheney had to cast the deciding vote.
If you are concerned about this proposed law — tagged S.1932 — tell your Congressional representative.