How Long Does an Approval for Medicaid Long Term Care Take?

Summary
There is not one simple answer when it comes to Medicaid Long Term Care approval time. The applicant’s financial situation, marital status, what type of Medicaid they’re applying for, and even the time of year can all make a difference. However, using data compiled from the hundreds of Medicaid applications our organization has submitted on behalf of our clients, we can calculate average Medicaid approval times for varying circumstances.

Average Approval Times for Medicaid Long Term Care Applications

From the day our organization submits an application to the state’s Medicaid office to the day our clients are approved for benefits takes an average of 83 days. This average was calculated using data from 500 clients nationwide. That analysis also yielded the following variances:

• Nursing Home Medicaid applicants were approved, on average, in 79 days.
• Home and Community Based Services (HCBS) Waiver applicants were approved, on average, in 89 days.
• Single applicants were approved, on average, in 81 days.
• Married applicants were approved, on average, in 87 days.

There are several factors that might cause delay from the state in approving Medicaid applications. Automated decision-making systems may produce incorrect algorithmic Medicaid denials with inadequate explanation. Documents could be lost or misplaced. Offices might be temporarily understaffed.

We have noticed consistent delays during certain months of the year. Here are the Medicaid approval times (in days) broken down by month. Notice the 140% increase from May to June, when many people take vacation time. Or the 129% increase in wait time from October to November, the start of the holiday season.

States are required by federal law to approve or deny Medicaid applications within 45 days (90 days for those that require a disability determination). According to our calculations, applications are not being approved or denied within the 45-day window. Furthermore, as the average approval times for June and November show, states will even push beyond the 90-day window. However, most Medicaid determinations are made within 90 days, and we found approval times have, on average, become shorter since the Covid-19 pandemic.

While Medicaid rules and regulations vary by state, we did not find a statistically significant difference in average application approval times by state.

Approval Does Not Guarantee Immediate Assistance

Just because a Medicaid application is approved does not mean Medicaid benefits will be immediately available. This is an important distinction, and the type of Medicaid Long Term Care an individual is applying for impacts how soon care is available. For instance, long term services and supports through a HCBS Medicaid Waiver is not an entitlement and wait-lists can and often do exist. These wait-lists can be months or even years.

For Medicaid coverage in a nursing home, some applicants are approved but have difficulty finding a Medicaid nursing home that is accepting new residents in their preferred geographic area.

Average Time to Prepare a Medicaid Long Term Care Application

Again, the approval time periods calculated above begin on the day the Medicaid application was submitted and end on the day the application was approved. The time it takes to prepare an application is not included in those calculations. However, we have also analyzed that data from our clients and found that from the day we start working with a client to the day we submit their Medicaid application takes an average of 79 days.

Collecting the necessary documents is the most time-consuming and challenging aspect of completing the Medicaid application. Some clients have a complete understanding of their financial situation and are well organized, and can therefore, supply the right documentation without delay. What’s more typical, however, is that the applicant, or the person trying to complete the application for an elderly loved one, lacks full knowledge of the situation. There might be forgotten bank accounts or investments, or maybe an irregular IRA withdrawal. Very commonly, an adult child of an applicant needs power of attorney to collect the right paperwork, but they don’t have it, so another months-long step is added to the process.

What’s more, the number of required documents is multiplied by Medicaid’s“Look-Back Period”. This “look-back” prevents applicants from simply giving away their assets or selling them under fair market value in order to get under Medicaid’s asset limit and become Medicaid eligible. The“Look-Back Period” in most states is 5 years, which means applicants must have monthly statements from all of their financial holdings – bank accounts, IRAs, stocks, bonds, etc. – for the five-year period prior to the date they submit their application. They must also document the sale of any asset during those five years – homes, RVs, cars, snowmobiles, time-shares, or anything else they have sold.

There are two exceptions to the five-year “Look-Back” time frame. California has a 30-month (2.5 years)“Look-Back” period. And New York currently has no “Look-Back Period” for Community Medicaid, the program through which it delivers home and community based long term care benefits.

Required Documents and Information for a Medicaid Long Term Care Application

The following assets must be documented for Medicaid applications:
• Cash
• Stocks
• Bonds
• Investments
• Promissory notes
• Savings, checking and credit union accounts
• Real estate in which one does not reside
• Non-primary vehicles
• All other assets easily converted to cash

The following income sources must be documented for Medicaid applications:
• Employment wages
• Pension payments,
• Social Security Income
• Supplemental Security Income
• Social Security Disability Income
• IRA withdrawals
• Stock dividends
• Alimony payments
• Veteran’s benefits

Collecting documentation may cause the greatest delay for families completing Medicaid applications on their own, but it is not the only one. Because Medicaid’s financial rules are complicated, families often submit applications for individuals who have too much income or too many assets. They may make a mistake when calculating finances. They may not respond to a question from the state Medicaid office in a timely manner. These are all problems that would most likely be avoided by using a Certified Medicaid Planner.

Functional Eligibility

In addition to meeting financial limits, and having all the documentation to prove it, Medicaid applicants must also meet functional limits to avoid delays in their approval. For Nursing Home and most Home and Community Based Services (HCBS) Waiver applicants, this usually means requiring a Nursing Facility Level of Care.

For HCBS Waivers, how the functional need assessment is handled is state specific. In some states, the county Area Agency on Aging completes an in-person functional assessment, and can be started and completed prior to submitting a Medicaid application. In other states, the functional assessment is done by a social worker with the Department of Human Services and is initiated when one submits their Medicaid application. Most persons applying for Nursing Home Medicaid are already nursing home residents and there is no functional assessment to schedule and complete. Instead, a form is submitted to Medicaid by the nursing home and takes the place of a functional needs assessment.

Pending and Retroactive Medicaid

Individuals can receive long term care benefits while their application is being processed by the state through Medicaid pending. They can even be reimbursed for care they received just prior to submitting their application through Retroactive Medicaid.

Medicaid Pending
When a person has applied for Medicaid Long Term Care but has not yet received approval, they have “Medicaid pending” status. This allows the yet-to-be-approved applicants to receive services and care at nursing home facilities that accept Medicaid pending residents. Facilities that accept Medicaid pending residents are assuming the individual will be approved for Medicaid, and the facility will be reimbursed for its services by Medicaid. While some facilities try to charge a Medicaid pending resident’s family the full cost, it is recommended that they not pay these costs while awaiting a Medicaid determination. This is because it can be very difficult to be reimbursed by the nursing home for costs paid. That said, the resident is expected to pay the majority of their income to the nursing home as a “share of cost” while their application is pending, just as they will continue to do after their Medicaid application is approved.

Retroactive Medicaid
In many states, retroactive Medicaid can help cover the cost of long term care for up to 3 months prior to the date an application has been submitted. However, the applicant must be approved for Medicaid and also meet Medicaid eligibility requirements for those 3 months. For example, Zoe moves into a nursing home in January, but doesn’t apply for Medicaid Long Term Care until April. Her application is also approved in April. Since she also met the asset and income eligibility limits for January, February and March, Medicaid will pay her unpaid nursing home expenses for those 3 months. In some states, Zoe would also get reimbursed for the expenses she paid for during those three months, while other states will only cover unpaid costs. Note that some states have eliminated or restricted retroactive coverage.