Social Security COLA Increase and your Long Term Care Medicaid
How the Social Security COLA Affects Your Long-Term Care Medicaid
Every year, Social Security benefits typically increase with a Cost-of-Living Adjustment (COLA). For those receiving Long-Term Care Medicaid in a nursing facility, this extra income directly impacts the amount they are required to pay the facility each month. This payment is known as the Patient Monthly Liability (PML).
When you receive your annual notice from the Department of Social Services (DSS) showing your new, higher PML, it’s important to understand how they arrived at that number.
Understanding Your Patient Monthly Liability (PML)
The PML is the portion of your monthly income that you are responsible for paying toward your care. Medicaid pays the remaining balance. The calculation is based on a straightforward formula designed to leave you with a small personal needs allowance and enough to cover certain medical expenses.
How to Verify Your New PML
You can verify the calculation from DSS by following these steps:
- Start with Your Gross Monthly Income: Add up all sources of income, including your new, higher Social Security benefit (the amount before any deductions for Medicare).
- Subtract the Personal Needs Allowance: In North Carolina, every Medicaid recipient in a facility is entitled to keep a small amount for personal expenses. This is currently $30 per month.
- Subtract Health Insurance Premiums: You can deduct the monthly premiums you pay for any health insurance, such as a Medicare Supplement (Medigap) plan.
- Subtract Excess Medicare Part D Premiums: If you have a Medicare Part D prescription drug plan, you can also deduct the portion of the premium that is not covered by other assistance programs.
The amount remaining after these deductions is your new Patient Monthly Liability.
The Importance of Keeping Your Caseworker Updated
It is crucial to notify your DSS caseworker immediately if there are any changes to your health insurance premiums. If the cost of your Medicare Supplement or Part D plan increases, it will lower your PML, but only if your caseworker has the correct information. Always provide documentation of any premium changes to ensure your PML is calculated accurately.
Navigating the financial rules of long-term care can be challenging. If you have questions about your benefits or need assistance with planning for Medicaid eligibility, our attorneys are here to help. Call our office at (919) 256-7000 to schedule a consultation.