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Financial help for Colorado Medicare beneficiaries

Medicaid asset recovery is only used in Colorado if the deceased received long-term care services

Josh Schultz // October 4, 2020

Reviewed by our health policy panel.

As a Medicare beneficiary, your state of residence can significant impact on how you pay for the care and coverage you receive.

The page provides information on help in paying for Medicare as well as options for long-term care coverage for beneficiaries who are dually eligible for Medicare and Medicaid.

Does Colorado help with my Medicare premiums?

Medicare beneficiaries who struggle to afford the cost of Medicare coverage may get relief through through a Medicare Savings Program (MSP). In Colorado, these programs pay for Medicare Part B premiums, Medicare Part A and B cost-sharing, and – in some cases – Part A premiums.

  • Qualified Medicare Beneficiary (QMB): The income limit is $1,064 a month if single and $1,437 a month if married. QMB pays for Part A and B cost sharing, Part B premiums. If the beneficiary is responsible for Part A premiums, QMB will pay for them, too.
  • Specified Low-income Medicare Beneficiary (SLMB): The income limit is from QMB levels up to $1,276 a month if single and $1,723 a month if married. SLMB pays for Part B premiums.
  • Qualifying Individuals (QI): The QI program will pay for Part B premiums for individuals with income up to $1,416 a month or for married couples with incomes up to $1,920 a month.
  • Qualified Disabled Working Individuals (QDWI): The income limit is $2,126 a month if living alone and $2,894 a month if living with one other person. QDWI pays for Part A premiums owed by certain disabled beneficiaries who have returned to work.

Asset limits: The asset limits for QMB, SLMB and QI are $7,860 for single applicants and $11,800 for married couples. QDWI’s asset limit is $4,000 for applicants who live alone and $6,000 for applicants who live with one other person.

Who's eligible for Medicaid for the aged, blind and disabled (ABD) in Colorado?

Original Medicare doesn’t cover some important healthcare benefits such as vision and dental care, and its coverage can leave enrollees owing significant co-pays, coinsurance and deductibles. Medicare beneficiaries can receive cost sharing assistance and coverage for some services Medicare doesn’t cover if they qualify for Medicaid ABD.

[mro_survey align ="right"]Medicaid ABD covers up to $1,500 each year in dental care, including dental exams and cleanings, fillings, extractions, root canals, and partial dentures.

Medicaid also covers an annual eye exam for enrollees who are 21 or older, but will only pay for eyeglasses or contacts if an enrollee has eye surgery.

In Colorado, Medicaid ABD is called Health First Colorado. Medicaid enrollees often also receive help with Medicare premiums through an MSP.

Income eligibility: The income limit is $783 a month if single and $1,175 a month if married.

Asset limits: The asset limit is $2,000 if single and $3,000 if married.

This website has more information about Medicaid programs in Colorado.

Qualifying for Medicaid ABD with income above the eligibility limit in Colorado

Colorado does not have a Medicaid spend-down, which means individuals whose incomes are too high for Medicaid ABD aren’t able to qualify for that program.

Assistance with prescription drug costs in Colorado

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

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

As of 2015, 20 percent of Medicare beneficiaries who lived at home received some assistance with LTSS. While the need will continue to grow as people continue to live longer, Medicare generally does not pay for long-term care. And while Medicaid does provide coverage for long-term care, eligibility rules vary from state to state and they are complex, which makes it hard for applicants to determine if they qualify for benefits.

As of 2020, Colorado uses a Special Income Limit (SIL) equal to three times the federal Supplemental Security Income (SSI) payment amount to determine eligibility for Medicaid long-term care. Colorado have a Medicaid spend-down, which would allow long-term care applicants to subtract medical and long-term care expenses from income counted toward the Medicaid eligibility limit.

Fortunately, federal rules allow some Colorado applicants to qualify for Medicaid long-term care benefits by depositing income into a Miller Trust. This process is discussed below.

Medicaid nursing home coverage

Most seniors used to receive long-term care in nursing homes. Today, many Americans receive LTSS in their homes. But some seniors’ housing or medical situations make nursing home care a better choice.

Income limits: The income limit is $2,349 a month per applicant. When only one spouse needs nursing home care, the state may only count income received by that spouse toward this limit.

Despite this income limit, nursing home enrollees can only keep a small personal needs allowance (of $89.55 each month) and money to pay for health insurance premiums (such as Medicare Part B and Medigap). Remaining income must be paid toward an enrollee’s care.

Assets limits: The income limit is $2,000 if single or $3,000 if married (and both spouses need care). If only one spouse has Medicaid, federal spousal impoverishment rules allow the other spouse to keep up to $128,640.

Certain assets – like household effects, family heirlooms, some prepaid burial arrangements, and one car – are not counted toward the Medicaid asset limit.

Home and Community Based Services (HCBS) waivers

Medicaid also covers community-based long-term care, which is provided at an enrollee’s home, adult day care center, or assisted living facility. Programs that cover this care are called Home and Community Based Services (HCBS) waivers, as enrollees continue living in the community, rather than entering a nursing home.

Colorado’s Elderly, Blind and Disabled Waiver (EBD) covers many long-term care services for applicants requiring a nursing home level of care:

  • Adult day services
  • Home delivered meals
  • Home modifications
  • Consumer Directed Attendant Support Services
  • Personal care services
  • Respite care

Income eligibility: The income limit is $2,349 a month per applicant. If only one spouse needs HCBS, the state may only count income received by that spouse toward this limit.

In Colorado, HCBS recipients are allowed to keep a personal needs allowance from their income equal to this limit (of $2,349 a month). This money can be used for living and health related expenses.

Asset limits: The asset limit is $2,000 if single and $3,000 if married (and both spouses need care). If only one spouse has Medicaid, federal spousal impoverishment rules allow the other spouse to keep up to $128,640.

Spousal impoverishment protections in Colorado

Unlike other Medicaid programs, Medicaid LTSS programs usually factor in only the applying spouse’s income. Normally with Medicaid benefits, the income of both spouses is counted.

In Colorado in 2020, spousal impoverishment rules allow the community spouse (i.e., the non-applying spouse) to keep a:

These rules only apply to spouses who don’t receive any Medicaid benefits themselves.

Qualifying for Medicaid LTSS with income above the eligibility limit in Colorado

Colorado limits Medicaid long-term care benefits to applicants with incomes below an eligibility limit of $2,349 a month (for singles). If an applicant’s income is higher than this amount but below the regional average cost for nursing home care, they can qualify for long-term care benefits by depositing their monthly income into a Qualified Income Trust (QIT). This is also called a “Miller Trust.”

Nursing home enrollees have to pay most of their income toward their care, but HCBS recipients can retain up to $2,349 a month for personal and health-related needs.

Most states don’t have a maximum income limit for using a Miller Trust, but Colorado has chosen to implement one; it is equal to the regional average private pay rate for nursing home care. (Those amounts are listed on page 4 of this document.)

In Colorado, applicants can only use a Miller Trust to become eligible for Medicaid nursing home care or HCBS – but not for Medicaid ABD.

Permitted home equity in Colorado

Federal law requires states to limit the home equity of enrollees who receive Medicaid coverage for nursing home care or HCBS. In 2020, states set their limits based on a federal minimum of $595,000 and a maximum of $893,000.

Colorado uses the federal minimum home equity limit – meaning applicants are not eligible for nursing home benefits or HCBS if they have a more than $595,000 in home equity. However, Colorado chooses not to apply this limit if a non-Medicaid spouse is living in the home.

Penalties for transferring assets in Colorado

Because long-term care is expensive, Medicare beneficiaries may feel the need to “impoverish” themselves by giving away or transferring assets to qualify for Medicaid nursing home benefits or HCBS. Federal law requires states to deter this practice by having a penalty period – during which time an applicant is ineligible for nursing home benefits – when assets are given away or transferred for less than their value. States can choose to also have a penalty period for HCBS.

Colorado has a five-year Medicaid look-back period that applies to all LTSS benefits, including nursing home care, HCBS, and the Program for All-Inclusive Care for the Elderly (PACE) program. During this period, asset transfers and gifts are prohibited.

This penalty period’s length is determined by dividing the amount transferred or given away during the look-back period by the average cost of nursing home care (which is $8,758 a month in Colorado in 2020).

In Colorado, this look-back period is fixed at five years, but the penalty period can last an unlimited amount of time.

Estate recovery in Colorado

Colorado Medicaid, along with all other state Medicaid programs, must attempt to recover what it paid for long-term care related costs for enrollees while they were 55 or older. States can also recover the cost of all other Medicaid benefits. This process is called estate recovery.

The state usually only recovers what Medicaid paid for long-term care for enrollees in this age range, but it also recovers from estates of younger enrollees who permanently resided in an institutional setting. If an enrollee receives Medicaid coverage for other medical or prescription drug services while Medicaid was paying for LTSS, the state will recover those costs, too.

Congress exempted Medicare premiums and cost sharing from Medicaid estate recovery beginning with benefits paid after December 31, 2009, but Medicaid may attempt to recover the cost of MSP benefits paid until that date. This could only occur for Colorado enrollees who received LTSS.

Where can Medicare beneficiaries get help in Colorado?

Colorado’s State Health Insurance Assistance Program (SHIP)

Colorado’s State Health Insurance Assistance Program (SHIP) can help you choose a Medicare Advantage or Part D plan, enroll in Medicare for the first time, or apply for a Medigap policy or MSP. You can reach the SHIP by calling 888-696-7213.

This website has more information about the SHIP in Colorado.

Elder Law Attorneys

Elder law attorneys can provide expert assistance about Medicaid long-term care benefits. Use the National Academy of Elder Law Attorneys (NAELA) search feature to find an elder attorney in your local area.

Medicaid Managed Care Ombudsman

Medicaid beneficiaries – including dual-eligibles who have Medicare and Medicaid – can contact Colorado’s Medicaid Managed Care Ombudsman program regarding issues with their Medicaid plan. The program’s phone number is 877-435-7123.

This page contains several other resources for Colorado Medicare and Medicaid beneficiaries who need help affording care.

Where can I apply for Medicaid in Colorado?

Colorado’s Medicaid program is administered by the Colorado Department of Health (CDH). You can apply for Medicaid ABD or the MSP using this website

Josh Schultz has a strong background in Medicare and the Affordable Care Act. He coordinated a Medicare technical assistance contract at the Medicare Rights Center in New York City, and represented clients in extensive Medicare claims and appeals. In addition to advocacy work, Josh helped implement 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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