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Financial help for Arizona Medicare enrollees

Nursing home residents with Medicaid in Arizona must have very few assets and contribute all but $117/month and the cost of health insurance premiums toward the cost of their care

Josh Schultz // October 4, 2020

Reviewed by our health policy panel.

This page explains how Arizona regulations and policies affect you as a Medicare beneficiary. The page also provides information on avenues for financial help with paying for Medicare and long-term care, including benefits for individuals who are dually eligible for Medicare and Medicaid.

Does Arizona help with my Medicare premiums?

Many Medicare beneficiaries who struggle to afford the cost of Medicare coverage are eligible for help through Medicare Savings Programs (MSPs).  These programs will pay for Medicare Part B premiums, Medicare Part A premiums in some cases, and Medicare cost-sharing.

Beneficiaries who are eligible for MSPs in Arizona fall into four categories:

  • Qualified Medicare Beneficiary (QMB): The income limit for QMB is $1,064 a month if single and $1,723 a month if married. QMB pays for Part A and B cost sharing, Part B premiums, and – if a beneficiary owes them – Part A premiums.
  • Specified Low-income Medicare Beneficiary (SLMB): SLMB pays Part B premiums for qualifying Medicare beneficiaries. The income limit is from QMB levels up to $1,276 a month for singles or $1,723 a month for married couples.
  • Qualifying Individuals (QI): QI pays for Part B premiums for those who qualify. The income limit is from SLMB levels up to $1,416 a month if single and $1,920 a month if married.
  • Qualified Disabled Working Individuals (QDWI): QDWI pays Part A premiums owed by certain disabled beneficiaries who have returned to work. The income limit for QDWI is $2,126 a month if living alone. (Few enrollees qualify for this program – and those who are eligible usually prefer to enroll in other Medicaid benefits available to disabled workers, such as Medicaid “buy-in” programs for working people with disabilities.)

MSP asset limits: Arizona does not have an asset limit for QMB, SLMB or QI. The asset limit for QDWI is $4,000 for enrollees who live alone and $6,000 for enrollees who live with another person.

The income limits for QMB, SLMB and QI vary based on an applicant’s marital status, but eligibility rules for QDWI, Medicaid for the aged, blind and disabled and Long Term Services and Supports programs are based on the number of household members.

Who’s eligible for Medicaid for the aged, blind and disabled in Arizona?

Medicaid for the aged, blind and disabled (ABD) pays for Medicare cost sharing, and may cover some benefits not paid for by Original Medicare (such as vision or dental care). This program is sometimes called SSI Medical Assistance Only in Arizona.

In Arizona, Medicaid ABD covers $1,000 each year in preventive, diagnostic and therapeutic dental services, and also pays for another $1,000 in dental care provided in emergencies.

But Arizona Medicaid doesn’t cover routine eye exams or vision services.

Eligibility: The income limit is $1,064 a month if single and $1,437 a month if married. This is the same income limit as QMB – which means many applicants receive both QMB and full Medicaid benefits.

Asset limits: There is no asset limit for Medicaid for the aged, blind and disabled enrollees who don’t need long-term care.

Assistance with prescription drug costs in Arizona

Medicare beneficiaries who are enrolled in Medicaid, an MSP, or Supplemental Security Income (SSI) also receive Extra Help – a federal program that lowers prescription drug costs under Medicare Part D. Enrollees who don’t receive this benefit automatically can apply for it through the Social Security Administration (SSA), in which case the income limit is $1,615 a month if single and $2,175 a month if married. The asset limit is $14,610 if single and $29,160 if married.

How does Arizona regulate long-term services and supports (LTSS)?

Many Medicare beneficiaries will end up relying on long-term services and supports (LTSS) – or long-term care – at some point in their lives.

Individuals applying for Medicaid long-term care benefits have to undergo a level of care assessment. This determines the care Medicaid will pay for them to receive.

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Long-term care services are usually not covered by Medicare. Instead, Medicaid pays for a significant portion of long-term care in the U.S. But Medicaid’s complex eligibility rules sometimes make it difficult to qualify for benefits.

Medicaid nursing home coverage

Most seniors used to receive their long-term care in nursing homes. Today, many Americans receive LTSS in their homes. But some beneficiaries have medical conditions or living situations that make nursing home care a better option.

Income limits: The income limit is $2,349 a month if single and $4,698 a month if married (and both are applying for coverage). When only one spouse is applying, only the applicant’s income is counted.

Despite this income limit, nursing home enrollees can keep only $117 each month as a personal needs allowance. Nearly all their other income must be paid toward their care.

Assets limits: The asset limit is $2,000 for each applicant. If one spouse doesn’t need Medicaid, spousal impoverishment rules allow the non-applying spouse to keep up to $128,640.

Certain asset don’t count against the limit: many household effects, family heirlooms, some prepaid burial arrangements, and one car.

Home and Community Based Waiver (HCBS) services

State Medicaid programs offer varying levels of community-based long-term care, which is provided in an enrollee’s home, adult day care center, assisted living facility, or another community setting. Programs offering these services are known as Home and Community-Based Services (HCBS) waivers because recipients don’t have to enter a nursing home.

Income eligibility: The income limit is $2,349 a month if single and $4,698 a month if married (and both spouses are applying).
When only one spouse needs Medicaid, the income limit for single applicants is used and only the applicant’s income is counted.

Asset limits: The asset limit is $2,000 for each applicant. If one spouse doesn’t need Medicaid, spousal impoverishment rules allow the non-applying spouse to keep up to $128,640 in assets. (These limits limit excludes certain assets like a car, home furnishings and other items.)

Spousal impoverishment protections in Arizona

For purposes of determining eligibility for Medicaid nursing home benefits or HCBS, only the applicant’s income is counted (but their spouse’s income is not). This is different from other types of Medicaid benefits, where the income of both spouses is counted – regardless of who is applying.

Spousal impoverishment rules allow the spouses of Medicaid LTSS recipients to keep a Minimum Monthly Maintenance Needs Allowance (MMMNA) from their Medicaid spouse’s monthly income, along with resource and housing allowances. This rule applies when one spouse received Medicaid coverage for LTSS, and the other spouse doesn’t have Medicaid.
In Arizona in 2020, a community spouse can these retain financial resources:

  • An MMMNA that is between $2,155 and $3,216 per month.
  • A Community Spouse Resource Allowance (CSRA) that is between $25,728 and $128,640.
  • A monthly housing allowance of up to $646.50.

Qualifying for Medicaid long-term care with income above the eligibility limit in Arizona

Arizona does not have a Medicaid spend-down, which means applicants with incomes above the eligibility limit for Medicaid for the aged, blind and disabled usually cannot qualify for that program. However, applicants with incomes too high to qualify for Medicaid nursing home care or HCBS can become eligible for those services by depositing income into a Qualified Income Trust or “Miller Trust.” Income placed into this Miller Trust doesn’t count toward the income limit for LTSS programs.

Miller Trusts aren’t an option for every Medicaid applicant in Arizona. As of 2019, individuals could only apply for Medicaid using a Miller Trust if their income was below $7,253.13 a month in Pima and Maricopa County, or less than $6,337.20 a month in all other Arizona counties.

Permitted home value in Arizona

States, as required by federal law, limit the home equity beneficiaries for nursing home care and HCBS can have. States set this home equity limit by choosing between a federal minimum of $595,000 and maximum of $893,000 in 2020.

In Arizona, LTSS recipients can’t have more than $595,000 in home equity.

Penalties for transferring assets in Arizona

Many individuals have an incentive to give away or transfer assets to become eligible for Medicaid to pay for long-term care. To curb this incentive, federal law requires states to apply a period of ineligibility for applicants for nursing home benefits who give away or transfer assets for less than their value. States can choose to also have a penalty period for HCBS.

Arizona applies an asset transfer penalty for nursing home care and HCBS. This penalty is based on a 60-month look-back period during which time asset transfers are prohibited. The penalty’s length calculated by dividing the amount transferred or given away by the average cost for nursing home care (which is $7,429.58 in Maricopa, Pima, or Pinal Counties, and $6,592.52 in other Arizona counties in 2020).

Estate recovery in Arizona

Medicaid programs are required to try to recoup benefits paid for a beneficiary’s long-term care and associated medical costs while they were age 55 or older. States can choose to also recover the cost of other Medicaid benefits. This process is called estate recovery.

Arizona has chosen to recover only from estates of Medicaid enrollees who received Medicaid nursing home care or HCBS.

Only the probate estate is subject to estate recovery in Arizona, meaning that retirement or bank accounts with “transfer-on-death” provisions are exempt (along with other property not subject to probate).

When Medicaid coverage was administered by a Medicaid Managed Care Organization (MCO) (i.e., a private insurer with whom the state contracts to administer Medicaid benefits), the state will attempt to recover what it paid the MCO. That means the estate recovery amount could be more (or less) than the actual cost of Medicaid services received.

Arizona will delay its estate recovery for enrollees who are survived by their spouse, or by a child who is under 21 or disabled.

The state may also reduce or waive its estate claim under specific circumstances (these are listed on pages 7-8 of this document).

Congress exempted Medicare premiums and cost sharing paid after December 31, 2009 from Medicaid estate recovery, but Medicaid may attempt to recover MSP benefits paid beforehand. In Arizona, this could only occur if an enrollee received LTSS.

Here is more information about estate recovery in Arizona.

Where can Medicare beneficiaries get help in Arizona?

Arizona’s State Health Insurance Assistance Program (SHIP)

Free, volunteer Medicare counseling is available by calling Arizona’s State Health Insurance Assistance Program (SHIP) at 1-800-432-4040. The program is offered through the Arizona Department of Economic Security.

Contact a SHIP for help enrolling in Medicare, comparing and changing Medicare Advantage and Part D plans, and getting information about state Medigap protections. They may also be able to offer referrals to local agencies for services like home care and long-term care. This website has more information about the SHIP in Arizona.

Elder Law Attorneys

The National Academy of Elder Law Attorneys (NAELA) has a search feature that can be used to find an elder attorney who can help individuals explore Medicaid long-term care benefits.

How do I apply for Medicaid in Arizona?

The Arizona Health Care Cost Containment System (AHCCCS) administers the state’s Medicaid program. Visit this website to print an application for the MSP or Medicaid ABD. You can also visit the AHCCCS website to find contact information for Arizona’s long-term care offices, which can help you apply for Medicaid long-term care benefits.

Josh Schultz has a strong background in Medicare and the Affordable Care Act. He coordinated the provision of expert Medicare technical assistance at the Medicare Rights Center in New York City, and represented clients in extensive claims and appeals. In addition to advocacy work, Josh helped implement federal and state health insurance exchanges at the technology firm hCentive. He has also held consulting roles, including at Sachs Policy Group, where he worked with hospital, insurer and technology clients.

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