ALTCS: What Is It And How Can It Benefit You?

Article submitted by Anonymous.

Long-term care costs are the biggest risk to the older adult's savings. For those lacking long-term care insurance, or enough insurance, ALTCS may be the only answer. ALTCS, pronounced "All-Tex", stands for Arizona Long Term Care System, known as Medicaid elsewhere. ALTCS has eligibility rules that must be met before benefits are provided.

Medical eligibility is measured by a PAS (pre-assessment screen), which evaluates cognitive and memory functioning, as well as the need for assistance with the activities of daily living.

The income eligibility limit is $1,737 (monthly) for a single applicant. A married applicant is eligible if either: (1) The applicant has no more than $1,737/mo. in his/her name; or (2) The couple's average monthly income is no more than $1,737. A Miller Trust is available for those applicants who exceed the income eligibility requirements.

Applicants cannot keep more than $2,000 in countable resources, but can own unlimited excluded resources. An applicant's community spouse may keep no more countable resources than his/her CSRD (Community Spouse Resource Deduction). Countable resources include all investments, including real property that is not excluded. Excluded resources include the primary residence, furniture and furnishings, a car, personal belongings, and burial plans and plots. The CSRD can be anywhere from $19,020 to $95,100, depending on the amount of countable resources held by either or both spouses as of the "snapshot date", which is either the beginning of the applicant's institutionalization or the date the applicant became medically eligible, if not yet institutionalized.

Whether single or married, the applicant or spouse can engage in some planning in order to preserve resources. Planning can include purchasing a single premium irrevocable immediate annuity in the name of the community spouse, converting countable resources to excluded resources, and/or making transfers to children. One word of caution: beware of "free" seminars offered to retirees promoting opportunities to take advantage of "secret" loopholes in the Medicaid program that permit you to avoid ever having to pay for care. These are almost always designed to sell deferred annuities, often with huge withdrawal penalties, which are of no value in this type of planning. Investing money in the home, paying off the mortgage, prepaying burial planning, or trading in an older car for a newer model, are all examples of spending countable resources for excluded ones. Gifting is yet another alternative; however, the rules regarding transfers must be understood and carefully followed if this option is exercised.

ALTCS recently began the process of filing liens against real property in the name of the person receiving benefits, unless certain exceptions apply. This is a significant change, as the agency previously limited their recovery efforts to claims against the probate estate.

These are very general rules that are subject to change concerning a government program that is extremely complicated. The best way to understand your options is to arm yourself with information concerning long term care planning and the law.