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By John M. Bigler Every year the New York State Department of Social Services issues new numbers representing the average monthly cost of a nursing home in the various regions in the State of New York. For the year 2004 the average monthly cost of a nursing home in the Long Island Region increased from $8,583 to $9,226 per month. Long Island is the most expensive region in the State of New York. New York City is second at $8,695 per month. The lowest number is for the central New York area (Syracuse area), $5,842.
The average cost number is the denominator in the formula that's used to determine the period of ineligibility for Medicaid payment to a nursing home when assets have been transferred from a Medicaid applicant.
In order to determine a period of ineligibility, the amount transferred, or gifted, is divided by the average monthly cost of the nursing home. That means that a gift will result in a lesser period of ineligibility on Long Island then anywhere else in the state. For example, if an individual were to make a gift of $100,000 in the month of April 2004, that would cause a period of ineligibility in Syracuse for 17.12 months, starting May, 2004, the month after the transfer takes place. However, on Long Island the period of ineligibility would only be 10.76 months, again starting May, 2004.
For someone who's waiting out a period of ineligibility, the higher number can be very useful. It will not matter if the nursing home on Long Island is more expensive if the period of ineligibility has expired or come close to expiring and Medicaid will be available to pay the nursing home stay. For some families who have an older member living in a different part of the state or even country, it may actually be beneficial to bring them to Long Island when the need for a nursing home arises.
For example, an older person who is a nursing home candidate who has family on both Long Island and Syracuse might be living in Syracuse because it's more affordable or for convenience or for any number of reasons. However, when the time comes to enter a nursing home, if that person moves to Long Island after having gifted $100,000 then their period of ineligibility will have been shortened from 17.12 months to 10.76 months, and so a significant savings could arise.
Another benefit of the increased number for 2004 is that it's effective retroactively for Medicaid applications taking place at present. That means that any transfers to another individual for the last 36 months or into or out of a trust in the last 60 months would be divided by the 2004 number.
It's an especially important detail for those people who have made transfers and are waiting out a period of ineligibility based on the average cost number from an earlier year. For example, a transfer of $300,000 in 2002 could have expected to result in a period of ineligibility on Long Island of 36.27months based on the 2002 average cost of a nursing home on Long Island of $8,272. With increases in 2003 ($8,583) and 2004, the period of ineligibility has now been reduced to 32.27 months.
Obviously, it's not a good thing that nursing homes on Long Island are so expensive. In fact, the average monthly cost given by the state is inaccurate. The actual typical cost of a nursing home on Long Island is anywhere between $10,000 and $12,000 a month. However, with proper planning it's possible to use the numbers given to one's advantage. As is always the case, the earlier planning takes place the more flexibility and the better chance to save.
Reprinted with permission of the Suffolk Times © 2004 [ Contact Us ] [ Guestbook ] [ Email ]  The Law Offices of John M. Bigler, Attorney At Law 1421 Wantagh Avenue, Wantagh, New York 11793-2206 1-888-ELDER-LAW · 516-409-6565 · Fax: 516-409-6522 E-Mail: info@biglerlaw.com · Web Site: www.biglerlaw.com |
As I have said on numerous occasions, Long Island has the distinction of being one of the most if not the most expensive place for nursing homes in the country. However, there's a silver lining for people doing elder law planning on Long Island.