Monthly Archives: June 2017

Trump Budget Calls for $600 Billion in Additional Cuts to Medicaid

June 28, 2017

The President’s budget called for over $600 billion in Medicaid cuts over a decade through either a per capita cap or a block grant. The proposed savings would come on top of the proposed $800-plus billion in cuts over 10 years in the American Health Care Act. The budget also calls for medical liability reforms, such as capping awards for non-economic damages at $250,000 indexed to inflation. NAELA does not anticipate Congress to act on the proposed additional cuts to Medicaid, but remains concerned about Medicaid structural reforms in the Senate generally.

District Of Columbia Slashes Estate Tax

June 28, 2017

At what level should an individual’s estate be taxed? $1 million? $2 million? $5 million? Back in 2014, the District of Columbia passed a major tax reform deal that included increasing its estate tax exemption amount from its then-$1 million level, once revenue targets were met. So the District’s exemption level doubled to $2 million at the start of 2017, and now it’s poised for 2018 to go up to match the generous federal exemption level ($5.49 million for 2017, indexed for inflation).

There was a cry to stop the scheduled cuts, but to no avail. Yesterday, the Council of the District of Columbia rejected an amendment to the budget to stop the 2018 estate tax cuts from going into effect with the intent of using those funds towards education and social services. “Our students and our most marginalized populations are continuously shortchanged,” said Councilmember David Grosso, who penned the amendment, in a statement after the vote. It was rejected 9-4. The Council passed the budget in a preliminary vote; it will vote on it again on June 13 (the Council votes twice on most pieces of legislation since it is a unicameral legislature.) Update: the June 13 vote was postponed until June 30.

Ed Lazere, executive Director of the DC Fiscal Policy Institute, who was a member of the tax revision commission under former Mayor Anthony Williams, says that the proposed 2018 budget falls short of achieving the goal of “inclusive prosperity” that mayor set, leaving funding gaps in the area of homelessness, high poverty schools and child care programs. “It’s more beneficial in the long term to be investing in D.C. residents than giving tax breaks to wealthy few,” he says.

How much is at stake? The change would cost the District $16 million a year, according to the Office of the Chief Financial Officer. In 2015, the estate tax brought in $32 million of revenue (0.45%), according to D.C. Tax Facts.

For 2017, in 18 states and the District of Columbia, you can owe estate or inheritance tax—separate from the federal estate tax. The trend has been for states to repeal their estate and inheritance taxes—or at least lessen the bite by raising the exemption amounts to match the generous federal estate tax exemption. Neighboring Maryland has been increasing its estate tax exemption: it will reach $4 million in 2018, and match the federal exemption in 2019. Virginia doesn’t levy an estate tax. See Where Not To Die In 2017 for a state-by-state run down. Minnesota is facing a tussle over its estate tax this year too (see Minnesota Weakens Estate Tax Retroactive to Jan. 1.)

Senators push to preserve funding for Medicare assistance program

June 28, 2017

Lawmakers called on Congress last week to continue funding a program that helps beneficiaries navigate Medicare, following the administration’s fiscal year 2018 budget proposing to cut it entirely.

The State Health Insurance Assistance Program, which provides counselors to Medicare beneficiaries to help with enrollment, choosing plans and appealing coverage denials, found itself on the chopping block for the second time in a year under last week’s budget plan.

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State Medicaid directors expect little change under Trump

June 28, 2017

Despite promises from the Trump administration to restructure Medicaid and reduce its funding by hundreds of billions of dollars, state Medicaid directors say it’s unlikely there will be major changes to the program.

On Monday, the Trump administration released a budget proposal that projected cutting Medicaid spending by at least $600 billion over a 10-year period, assuming the program is converted to a per capita cap program as outlined in the American Health Care Act. Continue reading

Trump’s Budget For Seniors: Bad, But It Could Have Been Worse

June 28, 2017

The best that can be said about President Trump’s 2018 budget and older adults: It could have been worse.

In a fiscal plan focused on historic domestic spending cuts, programs for older adults were hit by substantial reductions, though not slashed as deeply as other domestic programs.

Medicare was largely untouched. So was Social Security for seniors, although Trump would tighten eligibility and reduce some benefits in the Social Security disability program. Spending for most senior services programs was frozen for yet another year while subsidies for low-income senior housing were increased. Continue reading

Poll: Most older Americans want Medicare to cover long-term care

June 28, 2017

A growing number of Americans age 40 and older think Medicare should cover the costs of long-term care for older adults, according to a poll conducted by the Associated Press-NORC Center for Public Affairs Research.

That option is unlikely to gain much traction as President Donald Trump’s administration and Republicans in Congress look to cut the federal budget and repeal President Barack Obama’s 2010 health care law. Most older Americans mistakenly believe they can rely on Medicare already for such care, the poll shows, while few have done much planning for their own long-term care. Continue reading

DOL Announces That Fiduciary Rule Will Go Into Effect June 9

June 28, 2017

After initially delaying a rule intended to prevent financial advisers from steering their clients to bad retirement investments, the Department of Labor (DOL) announced that the rule will go into effect on June 9, 2017, but its future is still unclear.

Earlier this year, President Trump signed an executive order delaying the so-called fiduciary rule, the first part of which was scheduled to go into effect in April 2017, and calling for a review. The DOL is still reviewing the rule and can still make changes to it or repeal it based on the review, but the agency said there was no basis to further delay the rule’s implementation. It is possible that additional changes will be made before the rest of the rule is scheduled to go into effect on January 1, 2018. Continue reading

Applicant’s Ability to Use House Placed in Trust Does Not Render Trust Available, Mass. High Court Rules

June 28, 2017

Reversing a lower court, Massachusetts’ highest court rules that two Medicaid applicants’ trusts were not available assets even though the applicants retained the right to use the houses that were put into the trusts. Daley v. Secretary of the Executive Office of Health and Human Services (Mass., No. SJC-12200, May 30, 2017) and Nadeau v. Director of the Office of Medicaid (Mass., No. SJC-12205, May 30, 2017). Continue reading