Watch Out for Waivers
by Diana Armatage Johnston
As seen in Exceptional Parent Magazine: The Family and Professional Journal for the Specials Needs Alliance
Vol 38, Issue 07, July 2008 2008
When your clients seem to know more than you do about services for their special-needs children, you listen hard to what they have to say. You hear stories of 3-year waiting lists, unwritten rules that seem to change monthly, and the arbitrary loss of essential benefits for reasons clients do not understand. You hear questions about why one family gets all-day help, while your client’s child gets none. When you ask your client the name of the program that has denied assistance the answer is often, “I don’t know.”
Welcome to the world of waiver programs, where being eligible for a particular governmental benefit does not mean you will get it.
Government “Entitlement” Programs: Traditional government benefit programs are “entitlement” programs; that is, they provide benefits to every one who qualifies. Qualification rules vary, however. Some programs, like Medicaid, are means-tested (that is, requiring “impoverishment” for eligibility), while others, like Social Security disability benefits and Medicare, have no unearned income or asset limits. In either case lawyers can look up the applicable rules for entitlement programs in specific federal and state statutes, the Code of Federal Regulations, the POMS (the massive guidebook for Social Security claims representatives) or state specific manuals. While the rules are often complex, they are written down. Attorneys focusing on elder law, disability law and special needs matters pride themselves on mastering the intricate rules of the various programs in order to help clients obtain important benefits like Medicaid long term care assistance.
With only slight regional variations or state additions, the same Medicare, Supplemental Security Income (SSI) and Social Security Disability (SSD) rules apply nationwide. The rules for Medicaid vary considerably from state to state, however. This is because Medicaid is a state/federal program, with some federal requirements and many state variations. Lawyers who regularly study the Medicaid agency manuals of their particular states, as well as the federal regulations, should be able to advise their clients appropriately.
Housing Programs: Traditionally, housing assistance programs have been treated differently from other assistance programs. Only housing subsidies provided through the tax code, like mortgage interest deductions, have been available to all who qualify. For those of modest means who cannot afford to buy a house and get a mortgage, public and subsidized housing programs, such as Section 8 housing, limit participation by setting funding caps on construction and rental assistance programs. As a result, the waiting lists for decent affordable housing units are long. Obtaining housing assistance by qualifying for priority placement on waiting lists and holding on to precious units once obtained are key elements in the survival strategies of many lower income families. Losing a public or subsidized housing unit means going back to the end of a long line.
Waiver Programs: Waiver programs are more like housing programs than traditional entitlement programs because, by definition, waiver programs are those that have “waived” the traditional requirement that all who qualify must get timely benefits. And, as with housing programs, funding is limited and waiting lines can be long. Waiver programs may also waive other standard public benefit program requirements, such as statewide availability, so that a particular waiver program may only be available in certain counties in the state. But, while most of the “waived” requirements have the effect of making the program more restrictive, some can have the opposite effect. For example, a traditional public assistance requirement that the income of a parent is “deemed” available to a child, thus rendering the child ineligible for means-tested benefits, can also be waived.
To add to the complexity, waiver programs are state-specific and may or may not have published rules about admission standards, waiting lists and ongoing eligibility rules. Some states have state-funded home and community-based programs in addition to federal/state programs. Program rules can vary and program delivery systems can change. For example, North Carolina has recently undergone a restructuring of its various state and federal programs for children who are developmentally disabled and adults with mentally illness. Funding is very limited. “Disorganized” may be the most charitable description of the current situation. The only people who appear to have any firm information about the current availability of waiver program assistance for the developmentally disabled are the case managers and advocates for the disabled. These are the people in the trenches every day trying to assist desperate families through a labyrinth without clear rules and with waiting lists that can be longer than three years.
While lawyers can master the rules they can find, it takes a village to master rules that are not written down and which change without notice. It is no coincidence that many Special Needs Alliance (SNA) lawyers have family members with disabilities.
Watch Out for Waivers.
Here are a few things to keep in mind when working with waiver programs:
- Receiving waiver program benefits in one state is no guarantee that similar benefits will be available after moving to another state. Before moving to another state, check to see what programs are available in that state, the eligibility requirements, the precise help provided and the waiting list time.
- Even in waiver programs where the parents’ resources are not deemed to be available to their disabled child, a sudden inheritance or personal injury settlement that makes a child’s own assets exceed the limit for a means-tested program can prevent or terminate eligibility if not dealt with promptly. SNA lawyers can help in this situation by preparing a Special Needs Trust or counseling about the best way to spend down excess assets promptly if a Trust is not appropriate.
- Unlike regular Medicaid benefits, there may be transfer penalties for home or community-based waiver programs similar to the penalties imposed against SSI for transfers. So take care with gifts. While gifts to individuals of $12,000 or less per year are not counted for tax purposes, they are counted by many public benefit programs for transfer penalty purposes.
- Trustees of Special Needs Trusts for disabled beneficiaries must take particular care not to jeopardize eligibility for waiver or housing programs by making distributions that might, for example, make a beneficiary ineligible for SSI for only one month, but at the same time cause the loss of a hard-won waiver slot that could only be regained, if at all, after another 3-year wait.
Are Waiver Programs the Wave of the Future?
Waiver programs that provide in-home, community-based services can provide invaluable help for families who have children with special needs. How to get and keep that governmental assistance is information that should be equally available to all. Inadequate funding, fragmented administrative structures, variable eligibility requirements, and the mind-boggling complexity of programs that have grown piecemeal all work against equal access to waiver programs by even the most determined families and their advocates. Clear eligibility and waiting-list rules are needed, as are fair administrative procedures for termination. Unfortunately, the light at the end of the tunnel may be an oncoming train.
Proposed Medicaid rule changes (Federal Register/Vol. . 73.No.36/ Friday, February 22, 2008) appear to permit states to adopt State Plans that include a wide variety of programs, many of which are similar to waiver programs in that there are no requirements of comparability, statewide availability, freedom of choice or assurance of transportation to medically-necessary services. These proposed rule changes are designed to save tax dollars by limiting growth of “entitlement” programs and encouraging development of waiver programs that have funding caps and waiting lines. These major rule changes are not yet final. There may still be time for advocates to limit the transformation of the Medicaid program from an entitlement program, with a few very useful waivers, to a waiver program, with only a few entitlements.
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