Medicaid Reimbursement

Individuals commonly incur medical expenses before their Medicaid application is filed. They also incur costs after it is filed and before services begin. They also may incur expenses if Medicaid delays or incorrectly denied the application Many elder law practitioners are so focused on getting their client’s Medicaid application approved that they may lose sight of the fact that reimbursement for those expenses is possible. Payment for paid medical expenses is authorized for three distinct periods; pre-application, post-application and agency delay or error. Each time period has its own distinct requirements. In this article, we discuss the relevant law which applies to Medicaid reimbursement in the different periods and practical tips for the successful completion of such an application,.

PRE-APPLICATION

Reimbursement may be requested for medical care, services and supplies paid for in the three month period before the month of the Medicaid application. The pre-application period starts on the first day of the third month prior to the month of application. The applicant must have met the Medicaid eligibility standards during the month in which reimbursement is sought.

Medicaid has agreements with certain healthcare entities called “Medicaid enrolled providers” and may have negotiated favorable fees with them. Non-Medicaid enrolled providers may charge higher fees. In the past, Medicaid rejected reimbursement requests for services from non-Medicaid enrolled providers. Carroll v. DeBuono, 998 F. Supp. 190 (N.D.N.Y. 1998), a federal district court case, and Seittelman v. Sabol, 91 N.Y.2d 618 (1998), a New York State Court of Appeals case, invalidated that requirement. Now, during the pre-application period, reimbursement can be approved for services provided by non-Medicaid enrolled providers.

Clients should not expect to be reimbursed dollar for dollar. Reimbursement, even for services by non-Medicaid enrolled providers, will be limited to the amount that Medicaid would have paid and not the out-of-pocket amount that the applicant actually paid. In addition, reimbursement is reduced by any surplus monthly budgeted by Medicaid.

POST-APPLICATION

This period begins on the date of the Medicaid application and ends on the date of receipt of the Medicaid card. Reimbursement in this post-application period is limited to Medicaid enrolled providers. Medicaid applicants must be notified in writing of this restriction. Applicants must also be informed that any approved reimbursement is limited to the Medicaid rate. The following language in the Medicaid application itself contains the required notifications:

“I understand that reimbursement of medically necessary covered medical care, services and supplies will only be available if obtained from Medicaid enrolled providers and that reimbursement is limited to no more than the Medicaid rate or fee in effect at the time of service, even if I paid more.”

DELAY OR ERROR ON THE PART OF THE AGENCY

In the case of error or delay on the part of the Medicaid agency, reimbursement is not restricted to Medicaid enrolled providers and is not restricted to the Medicaid rate. The agency is required to determine eligibility within a specific time frame. Unless the applicant is a minor, pregnant, or seeking Medicaid benefits due to disability, the application must be processed within 45 days. Delays in processing are common. Bills incurred after the 45th day from the date of application may be reimbursable.

If the agency denies the application and then reverses its incorrect determination or is reversed at fair hearing or court order, the medical costs incurred may be reimbursable. Reimbursement here is not restricted to the Medicaid rate. As a general rule, out of pocket expenditures that do not exceed 110 percent of the Medicaid rate are always reasonable and may be fully reimbursed. Out-of-pocket expenditures that exceed 110 percent of the Medicaid rate may also be reasonable under particular circumstances and may be fully reimbursed.

PRACTICAL STEPS IN FILING FOR REIMBURSEMENT

The request for pre-application reimbursement must be made at the time of the
initial application. That request is made by answering “Yes” to the following question on the Medicaid application “Does anyone applying have paid or unpaid medical or prescription bills for this month or the three months before this month?”

If the applicant dies before the application process is complete, Medicaid will
deny reimbursement on the ground that it cannot establish financial eligibility or how many hours of care were appropriate.

The most common type of medical expenses for which reimbursement can be requested are expenses for home attendants. An applicant who has been found financially eligible must undergo medical assessments to determine the number of hours that will be provided. The entire medical assessments process may take as long as three months, during which time the home care services would have to be paid for privately.

The key to a successful applicant is to provide Medicaid with adequate
documentation. Medicaid is only permitted to provide reimbursement to an amount equivalent to the level of services which are approved by the medical assessment.

For example, If the applicant was paying privately for twelve hour per day of home care services, but the assessment determines that the applicant is only entitled to receive six hours of home care services, then reimbursement will only be provided for six hours per day.

The application for reimbursement of home care expenses must include supporting documentation.

● A copy of the plan of care which was issued by the medical assessment which indicates the amount of services to be provided to the applicant as well as the specific tasks for which assistance is to be provided.

● A copy of the plan of care which was prepared by the licensed home care agency that the applicant paid privately. This plan of care must indicate the tasks provided to the applicant by home attendants as well as the number of hours of services that were provided to the applicant by this agency. If Medicaid sees that the licensed home care agency was providing coverage to the applicant for specific services or timeframes that were not included in the plan of care which was approved by the medical assessment, the reimbursement request will be denied.

● Detailed time records which indicate the specific dates and times in which the applicant was receiving home care services during the period of time for which reimbursement is being requested, as well as the names of the specific individuals who were providing these services during specified times each day should be included. The number of hours of services which the applicant received each day during that time period must match the number of hours that were approved by the medical assessment.

● Detailed records of all payments to the home care agency for services rendered on behalf of the applicant, which indicate the amounts paid, copies of either cancelled checks or credit card receipts, all invoices which were issued by the home care agency, the specific dates of services which correspond to each payment, and proof that the person who is requesting reimbursement was indeed the payor of these funds.

● It would be prudent to prepare a spreadsheet which links dates of services provided, names of home attendants for specific hours on each date, hourly rates of payment, invoices from the home care agency, payments to the home care agency, and sources of payment. Without proper documentation, the reimbursement request will be denied.

CONCLUSION

Complete legal advice to a Medicaid applicant must include a discussion of potential reimbursement issues. Clients should be advised that the family may be required to pay privately for home care services for a few months while awaiting financial and medical approval of home care services by the Medicaid Program. Accordingly, clients should be advised to save appropriate documentation during that time period (copies of invoices, cancelled checks, and plans of care) so that these documents can be readily available for a reimbursement application.