Alan D. Bell Attorney at Law
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How the Medicaid Deficit Reduction Act impacts your health care

From 2005 to 2008, a series of regulatory overhauls was applied to Medicaid in order to reduce the federal budget. Many of these changes had little impact on recipients who already received coverage, but there were major changes that affected individuals across the spectrum. The most far-reaching of these changes applied to eligibility and liability. While the full scope of changes is too much to cover in a short session, the major issues are worth a quick lesson. Here is what you should know.


One of the biggest changes introduced by the Medicaid Reduction Act applies to eligibility. It is noticeably more difficult to qualify for coverage than it was before the changes. One of the specific changes that made the biggest impact was in asset transfers. Before the bill, it was legal to transfer assets prior to applying for coverage in order to reduce wealth holdings and qualify. Now, the application will look for asset transfers and will include them in application consideration. Most commonly, senior citizens were able to transfer ownership of their homes. Now, even if ownership is transferred, a home equity of $500,000 automatically disqualifies admittance into the program. While many seniors own homes worth much less than $500,000, being force to include that equity in their assets bars many from receiving Medicaid benefits.


Another major change refers to certain aspects of liability. Hospitals and caregivers are no longer financially responsible for a range of low-impact, care-related conditions. Things like pressure ulcers or pressure sores would fall under this category. These health issues still require medical attention, but the payment for that care is now coming from care recipients' Medicaid budgets or out of pocket. In either case, this change in responsibility makes senior care more expensive for the recipients, especially if they live in a care facility. While the change was intended to incentivize caregivers to increase their focus on more life-threatening issues, there is no denying the impact it has on personal finances.

If policy changes have prevented you or a loved one from receiving adequate care, there are a number of avenues that could potentially help your situation. Consider a legal consultation to see which paths would lead to the best resolution and best healthcare opportunities.

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Alan D. Bell
650 Bloomfield Avenue, Suite 105
Bloomfield, NJ 07003

Phone: 973-233-4291
Phone: 973-743-7070

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