By E.J. Kessler

Published February 03, 2006, issue of February 03, 2006.
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The budget reconciliation package that was expected to pass the House of Representatives on Wednesday contains a measure that could spell disaster for Jewish community-run nursing homes, Jewish communal officials said.

Under the Republican proposal, seniors who have transferred assets to relatives would be barred from Medicaid coverage of their nursing home bills for a period of at least five years. Under current law, the period is at least three years. Nursing homes would be left to pick up the bills for any care that is not reimbursed.

The new rules are designed to eliminate the common practice of asset transfer, which critics say burdens taxpayers with the bills of seniors who can afford to pay for their own care. Only seniors with $2,000 or less in assets, excluding a house and a car, can qualify for Medicaid; many middle-class seniors give away their assets to their grown children in order to get into the program. Besides extending the period of asset-transfer restrictions, the new rules limit the value of an excluded house to $500,000 — a change that potentially affects thousands of seniors living on the coasts, where even modest housing can top that value. Jewish seniors live disproportionately in such high-cost areas.

The passage of the Medicaid measure in the budget reconciliation bill — officially called the Deficit Reduction Act — represents a setback for United Jewish Communities, the roof body of the 189 local Jewish charitable federations. UJC is the Jewish community’s chief lobby on federal budget matters. While several other national Jewish agencies opposed the budget reconciliation bill in its entirety, UJC’s lobbyists did not; instead they focused their efforts on defeating the Medicaid asset-transfer measure and on some other provisions that they felt would lead to hardships for charities. They justified the strategy as the wisest course, given the climate for social services in the Republican-controlled Congress.

In an e-mail to the Forward, UJC’s chief Washington lobbyist, William Daroff, wrote that his organization’s laserlike focus “has worked, to some extent, in that we have received assurances from some very key members of both houses that they will work to smooth out the particularly odious parts of the Medicaid provisions.”

“Had we been out there as Kamikaze pilots, trying to take down the whole Congress, I don’t think we would be seen as constructive partners in the public policy process,” Daroff wrote.

Daroff also wrote that UJC also is concerned about the effect that the asset-transfer changes will have on charitable donations, which might be put off for years until a person’s death. Other matters of concern involve new copayments that would be affixed to a variety of Medicaid services and could lead to denials of services. Similar copayments have proved economically burdensome for participants when they were introduced into the Medicare program in recent years.

The matter of high home values on the coast could be addressed by indexing home prices to fair market value, to keep pace with the real estate market, according to Daroff.

“We have already opened communication with key members of the House and Senate to push forward a legislative fix for the more egregious parts of the legislation, which we hope to move forward with over the next couple months,” Daroff wrote.

The asset transfer measure was supported by the White House and by the National Governors Association. The nonpartisan Congressional Budget Office estimated that the measure and other related changes will save the federal treasury about $8.7 billion over 10 years. It is expected to affect more than 125,000 people each year.

UJC and its affiliated federations receive about $7 billion in federal subsidies annually. It is unclear how much of that money would be affected.

National Jewish agencies that opposed the budget reconciliation package included the Religious Action Center of Reform Judaism; the Jewish Council for Public Affairs, a policy coordinating body for Jewish community relations councils and national agencies; and the National Council of Jewish Women, a liberal group.

In a January 26 letter to Congress on behalf of the Reform movement, Rabbi David Saperstein, director of the RAC, blasted the budget package for “benefit changes in Medicaid that will leave millions of vulnerable recipients, including 28 million low-income children, with less access to vital health care services and prescription drugs,” “cut[ting] a net amount of $12.7 billion from federal student loan programs” and cutting “$1.5 billion in… child support enforcement.”

“This is a very difficult environment for those who care about human services,” said the RAC’s associate director, Mark Pelavin. “Clearly, UJC is charged with a different role than we are. They look narrowly at the impact on the Jewish community. We look broadly at the impact on society. We can’t be surprised when things that impact broadly affect us, too.”

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