SMART Bill Will Make Harsh Changes to Illinois Medicaid Eligibility Rules

             In the next few days, Senate Bill 2840, also known as the “SMART” bill, will likely be signed into law by the governor.  It recently came to the attention of the Elder Law Center that certain language was added to the 400 plus page bill that would have a severely negative impact on our clients and the senior citizens of Illinois.  These changes were inserted into the bill despite the recent and protracted negotiations between the Joint Committee on Adminstrative Rule Making and HFS director Julie Hamos, and they effectively undo many aspects of the new Medicaid eligibility rules that took effect on January 1, 2012.  

            On May 22, Katie Malesky from our office was in Springfield with other members of the Illinois Chapter of the National Academy of Elder Law Attorneys (IL-NAELA), in an effort to inform our legislators of the potentially devastating impact of SB 2840 if passed in its current form.  In addition to spending the day in Springfield, the Elder Law Center has joined forces with the members of IL-NAELA and other advocacy groups on behalf of the senior citizens of Illinois by contacting legislators by phone and by fax to express concerns about the bill.  As a result of these efforts, language was removed from the bill that would have significantly reduced the Community Spouse Resource Allowance (the amount of assets the healthy spouse may keep while the unhealthy spouse is on Medicaid), and the monthly income for the community spouse.  Thus, the legislature was responsive to one of our biggest concerns regarding this legislation.  

            However, there are numerous provisions of the bill that remain of grave concern to us, including but not limited to the following:

  • A provision that would not allow a home placed in a trust to be considered exempt homestead property, even if the community spouse or another qualified individual is living there.  Thus, individuals who have homes in revocable living trusts as an estate planning measure may have to transfer the home out of trust in the event one spouse needs to apply for Medicaid.
  • A provision which would eliminate the ability of a person over the age of 65 to utilize a pooled trust, unless the person is a ward of the county public guardian or state guardian.  These trusts enable individuals to set some money aside in the trust, which contains a pay-back provision to the state, so that they have assets available to cover things that Medicaid will not.

            Since many harsh provisions of the bill have not been amended, and will likely become law, we will continue lobbying and working with our legislators in the hopes that there can be further legislation, sponsored by those legislators who agree that these changes are unwarranted and unfair to senior citizens.  We encourage all of our clients to contact their representatives and voice their concerns over this legislation, in the hope that it may be amended in the near future.  Together, we can make a difference to protect the senior citizens of Illinois.

To find out who your representatives in the Illinois Legislature are, click here: http://www.elections.il.gov/districtlocator/districtofficialsearchbyaddress.aspx

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