Changes in TennCare/Medicaid: New CHOICES Rules

Throughout 2012, change has been afoot in the rules for Tennessee’s Medicaid program, “CHOICES.”  On July 1, a new set of rules took effect, dramatically changing the criteria for qualification and the services an individual can or cannot receive based on his or her need acuity rating.  Public benefits programs such as Medicaid are always confusing, and these new rules have made navigating the labyrinth of rules and options even more daunting for the average applicant.  In this issue of Elder Counselor, we will outline some of the changes and attempt to clarify many of the issues that may affect both current CHOICES beneficiaries and new applicants.

Tennessee’s CHOICES program offers in-home services, funding for approved adult day care centers, partial payment to approved assisted living facilities, and full funding for long-term care in a nursing home. In order to qualify for CHOICES, Tennesseans have always had to meet financial and functional requirements, but as of July 1, 2012, the medical eligibility rules  have become stricter.  Prior to July 2012, individuals with only one deficit in  activities of daily living (ADLs) met the functional eligibility criteria for CHOICES to receive either nursing home care or care in the community.  But now an individual applying for the CHOICES program must qualify financially AND either (A) have a high level of need for the level of care provided by a nursing home or (B) qualify as an individual “at risk” of needing nursing home care.

To determine whether nursing home care will be provided or just how “at risk” an individual is, the CHOICES program evaluates applicants and rates their need acuity.  This acuity score is based on factors such as the applicant’s mobility, ability to perform basic tasks (eating, toileting, etc.) without assistance on four or more days per week, expressive and receptive communication, behavior, need for skilled services, and ability to self-administer medicine.  The applicant receives a numerical score between 1 and 26, and that score determines both the applicant’s eligibility for the program and which one of the three CHOICES groups the applicant is sorted into.  The score must be supported by documentation from the medical chart of the applicant.

CHOICES Group 1 is the most straightforward.  This is for the individuals whose need acuity score is between 9 and 26 and who require or choose to receive care in a nursing home.  Group 1 is an entitlement program, which means that if the individual meets all the eligibility requirements for this group, the benefit must be provided to him or her.  Of the three groups in the CHOICES program, Group 1 is the only entitlement program. 

CHOICES Group 2 is offered through the “waiver” program, where the state applies with the federal government for permission to provide long term care services in an environment other than a nursing home.  Group 2 is also for individuals whose acuity score is between 9 and 26 but who choose to receive care through home and community-based services (HCBS).  Group 2 has a cost cap of $55,000 annually.  Unlike Group 1, Group 2 is not an entitlement program.  This means that an individual who qualifies will receive as much benefit as the plan of care calls for IF there are funds available for the program.  The result is that Group 2 individuals may end up on a waiting list to receive their benefits. There is an enrollment cap of 12,500 individuals for Group 2 at this time.

Group 2 individuals may receive a wide array of HCBS, but sometimes accepting one service means that other services will be excluded from their benefits.  For instance, Group 2 individuals may opt for a benefit called “community-based residential alternative” (CBRA).  However, if someone opts for this CBRA, he or she cannot receive other HCBS simultaneously, including adult day care or short-term nursing home care. And, importantly, it is TennCare ultimately that decides the plan of care and how much of the benefits any one applicant will receive in Group 2.

CHOICES Group 3 is a new group and includes individuals who don’t have a “score” but who meet the old criteria for nursing home care of one deficit in an activity of daily living (ADL).  These individuals are considered “at risk” of needing nursing home care if they do not receive some kind of community-based support. Services for Group 3 individuals are subject to an annual $15,000 cost cap excluding home modifications and excluding care received in an alternative residential care setting.  That means that the $15,000 cannot be applied toward paying for care in a nursing home or assisted living facility.  Like Group 2, Group 3 is not an entitlement program, so individuals in this group will only receive their allowed benefits to the extent that program funds are available and may end up on a waiting list.  Note, however, that Group 3 will have unlimited enrollment until December 2013.

Benefits for Group 3 are essentially the same as Group 2 except that all CBRAs (including assisted living) are excluded, there is a limit on monthly prescription benefits, and there is a prescription co-payment.

If this new CHOICES stuff isn’t complicated enough, there is actually another category of individuals whose need acuity score of 6-8 qualifies them for Group 3 but who cannot be safely cared for at home because of cognitive or behavior problems.  These individuals have a greater need acuity in some specific areas (orientation and behavior) than other individuals in Group 3.  Persons in this situation can apply for an Advance Determination and can be admitted to a nursing facility for 30 days and then re-evaluated every 30 days thereafter.  Eventually, one would hope that the Advance Determination cycle would end and the individual would be formally placed into Group 1 or 2.  But so far it is unclear what will happen long-term if the need acuity score does not rise to the magic number of 9.

Another complication related to the changes in CHOICES qualification has to do with individuals who were already enrolled in the old CHOICES program prior to the introduction of the three-group system in July 2012.  For most individuals who were enrolled in Group 1 prior to July 1, 2012, changes are minimal at first glance.  Previous Group 1 members (that is, people who were already in nursing home care) have been grandfathered into the new law, which means that even if they would not meet the new need acuity standards upon reevaluation, they can still remain in nursing home facilities indefinitely without fear of being demoted to Groups 2 or 3 so long as their financial eligibility is continuous. However, if a grandfathered resident sells his or her home, for example, and spends down the proceeds, he or she will need to meet the new acuity score of 9 to transition back to Group 1 after the proceeds are spent, even if he or she never left the nursing home.

Also, previous Group 1 members have the option of transitioning to Group 2 and receiving HCBS. In some circumstances, TennCare will even pay $2000 to help someone relocate to a community based setting. However, once transitioned to Group 2, if the individual needs to reenter the nursing home, the new need acuity requirements must be met.  Previous Group 2 members (that is, folks who were receiving HCBS benefits prior to July 1, 2012) must now meet the new need acuity requirements if they wish to transition to Group 1 and receive nursing home care.

The new CHOICES rules are confusing at best, and both applicants and health care providers are struggling to navigate the maze of options and determine the best course of action for themselves.  If you need help in your own decision-making process or have questions about the new CHOICES rules, get in touch with Elder Law of East Tennessee.  Call us at (865) 951-2410 or send an e-mail to info@elderlawetn.org. We can give you the tools you need to manage your long-term planning with Medicaid benefits.