Long-term services and supports (LTSS) manual

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Guardianship training

Revised Date: 
April 18, 2022

Purpose: A training packet giving examples of how guardianship fees and costs and attorney fees relating to guardianship orders is allowed in post eligibility for Institutional Medicaid (residing in medical institutions) and Waiver institutional programs.

Note: The computations used for this training material reflect standards as of 9/1/2008.
Hit link for current long term care standards. (SIL, MNIL, FBR, FPL)
Hit link for current PNA and ADSA room and board amounts

Allowing Guardianship Fees & Costs/Attorney fees

WAC, 388-79-030; states a client’s monthly guardianship fee cannot exceed $175. In addition, the costs (including attorney’s fees) for the establishment of the guardianship cannot exceed $700. The costs for review of the guardianship cannot exceed $600 in any 3-year period.

WAC 388-79-040 outlines how the guardian is to notify us and under what conditions those fees and costs may exceed the $175/$700/$600.

Even though we are notified correctly per WAC 388-79-040, orders are approved with fees and costs that exceed the amount in WAC. We will allow as long as the guardianship fees and expenses, plus the PNA, plus the earnings and mandatory tax deduction does not exceed the MNIL if residing in an institution.

For HCB Waivers the combined PNA, earnings deduction and guardianship fee can't exceed the SIL.

Guardianship fees are an allowable "post eligibility" deduction for Institutional Medicaid programs only. (L and K track programs). Post eligibility is the part of the computation that determines how much the client must contribute toward the cost of "personal care". Another term for this is called "participation".

Guardianship fees is not an allowable deduction in Medicaid rule for noninstitutional medicaid.

Note: What is a Medical Institution for the purposes of Medicaid?

Medical institutions are:

  • Nursing facilities
  • Hospice Care Centers
  • Hospitals
  • State Veterans Nursing Home
  • Rehabilitation Habilitation Centers (RHC)
  • Institutions for the mental retarded (IMR)
  • Institutions for the mentally diseased (IMD)

Clients in Medical Institutions-Nursing Homes

When it comes down to writing the award letter, please remember, for nursing home participation there is a limit to how much you can allow each month, in addition to the limits imposed by the Guardianship WACs. See WAC 182-513-1380

For nursing home cases there is a group of deductions that when totaled cannot exceed the medical needy income level or MNIL. Included in this group are guardianship fees & costs (which include attorney’s fees and back fees).

For a client in a nursing home, when added together the following deductions cannot exceed the MNIL:

Total of these may not exceed the MNIL

  • PNA, plus
  • Mandatory income tax, plus
  • Wages of a recipient in an approved employment/rehab plan, plus
  • Guardianship Fees and associated costs.

Here are some examples of how this will look:

Example #1 - Medical Institution

A single client has $1000 in unearned income. No earned income. Client also has a deduction for mandatory income taxes from their pension of $50 per month. In addition, this client has a guardian and we have a court order approving the monthly fee is $175 as well as $700 attorney’s fees for the initial guardianship.

Month 1 – client enters nursing home on the 5th of the month from home. This is the first month of the guardianship court order.

Participation will look like this:

$1500 Income

- 733 PNA (month of admit) CNIL as of 1/1/2015

- 104.90 Medicare Part B (If Month 1 of eligibility)

$ 662.10 Participation

But wait – what happened to the $50 income tax, the guardianship fees, and the attorney’s fees?

Well, we can’t allow them this month. The client will have to pay for those out of their PNA for this month. Why? Because we cannot allow more than the PNA for all of those deductions combined, and the PNA for the initial month is the MNIL. There isn’t any more of an allowance we can use.

Okay, so now for month 2…

Example #2 - Medical Institution

month 2…

The same client and is in the nursing home the entire month.

Participation would be:

$1500.00 Income

- 57.28 PNA

- 50.00 Mandatory income tax

- 175.00 Month 2 guardianship fees

- 175.00 Month 1 guardianship fees

- 275.72 Attorney’s fees you can allow ($424.28 remaining)

-$767.00 Participation

Notice that the combined total of PNA + Income Tax + both months of Guardianship Fees and allowed costs are $733.00. The remaining attorney’s fees will need to be allowed in future months. Always allow guardianship fees before allowing attorney’s fees.

Example #3 - Medical Institution

Month 3…

The same client is in the nursing home the entire month.

Participation would be:

$1500.00 Income

- 57.28 PNA

- 50.00 Mandatory income tax

- 175.00 Guardianship Fee – month 3

- 424.28 Attorney’s fee you can allow (you've now allowed the entire $700)

$ 793.44 Participation

Example #4 -Medical Institution

Month 4…

The client is in the nursing home the entire month.

Participation would be:

$1500.00 Income

- 57.28 PNA

- 50.00 Mandatory income tax

- 175.00 Guardianship Fee Month 4

$ 1217.72 Participation

Note: Of course, for new nursing home openings with Medicare an allowable medical expense deduction, those expenses come after we allow for PNA, Mandatory Income Tax, Guardianship Fees & Attorney’s fees.

Now, on to COPES (HCS CN Waiver)

The COPES waiver was written and approved by CMS differently.

WAC 388-515-1509 states:

The total of the following amounts cannot exceed the Medicaid SIL: The SIL is 300% of the FBR.

  • Maintenance
  • personal needs allowances
  • Earned income deduction of the first sixty-five dollars plus one-half of the remaining earned income in subsection
  • Guardianship fees and administrative costs

The important thing to remember is we can reduce COPES participation, not room and board. If you need to reduce room and board, you must have an approved ETR (Exception to Rule) in place before you can reduce the room and board portion of the payment. This amount comes out of State funds.

The ETR request must be forwarded to the HCS Regional designee when requesting a reduction of room and board for any reason.

An approved ETR must be coded in ACES on the LTCX screen under the exception to rule field in order to deduct from room and board.

What is room and board and what is an alternate living facility (ALF) ? How do we deduct guardianship fees if there is only room and board? (ETR request).

  • What is an ALF?
      • Licensed as a boarding home or adult family home by ADSA
        • There are different types of boarding homes, they are called
          • Assisted Living Facilities
          • Enhanced Adult Residential Centers (EARC)
          • Adult Residential Centers (ARC)
          • DDA Group Homes
        • Licensed as a mental health adult residential treatment center ARTF) by Dept. of Health.
        • An ALF is not a medical facility. DSHS approves MPC or DDA/HCS Waivers in ALFs.
    • What makes an ALF so complicated?
      • 2 parts
        • Federal part of the computation is called client “participation” or what the client pays toward their “personal care”.
        • State funded part of the computation is called room and board. This is considered the shelter and food portion of the cost. Think of room and board as the rent. It is the part that does NOT cover personal care.
          • Room and board is the FBR of $733 minus the COPES PNA of $62.79 = $670.21, as of 1/1/2015
          • When a deduction is made out of room and board it is coming from state funds.
          • HCS requires an ETR process in order to deduct anything from room and board because it is coming out of state funds. This is for any reason including guardianship orders.
        • So think about the Personal Care as the part of the computation we can claim federal match, in other words NOT the room and board portion.

Note: As a side note, because an "ALF" is not considered a medical institution, we cannot allow any unpaid private pay fees (prior to Waiver eligibility) for an ALF as a medical deduction to reduce participation.

Example #1 - COPES
So, using the same client above. $1500 unearned income, $50 income taxes, $175 guardianship fees with $700 initial attorney’s fees.

$1500.00 Income

- 981.00 PNA (as of 4/1/2015)

- 175.00 Guardianship Fees

- 344.00 Attorney’s Fees – there is enough income to allow (if the clients income was lower, there may not be enough income to allow attorney fees)

$ -0- Participation

Did you forget the $50 income taxes?

No. The waiver does not allow for a reduction for mandatory income taxes. A client who is on COPES at home must use their PNA to cover this cost.

Note: Unlike nursing homes, however, Medicare and medical expenses are allowed after PNA but before guardianship fees and attorney’s fees.

Example #2 COPES

So, if this was month 1 of eligibility, and the client had Medicare, it would look like this at home:

$1500.00 Income

- 981.00 PNA

- 104.90 Medicare

- 175.00 Guardianship Fees (remainder is $138 out of the $175)

- 239.10 Attorney’s Fees (remainder is $700)

$ -0- Participation

Example #3 COPES

Same client in an ALF – admit month:

$1500.00 Income

- 733.00 PNA/Room & Board ($62.79 + $670.21)

- 104.90 Medicare Part B (Month 1 or 2 of Eligibility)

- 175.00 Guardianship Fees

- 487.10 Attorney’s Fees (Remainder is $212.90)

$ -0- COPES Participation

+ 670.21 Room & Board

$ 670.21 Client’s Cost of Care

Just like at home, Medicare and medical expenses are allowed after PNA but before guardianship fees and attorney’s fees. They are allowed out of COPES participation, not out of room and board. If you must reduce room and board, then you must have an approved ETR to do so. Room and board is state funds and considered the portion for shelter and food.

But what about that income tax? We’re not expecting a client with PNA of $62.79 to use that to cover the income taxes, are we?

Well, unfortunately, the COPES waiver covers both in-home and ALF. If it doesn’t allow for it at home, it doesn’t allow for it in the ALF. You cannot use an ETR to reduce the COPES portion of the payment because this goes against the state plan. Your only option is to request an ETR to reduce the room and board payment to allow for the mandatory income taxes.

What about Guardianship fees for non institutional Medicaid programs?

  • A court ordered guardianship fee is not an allowable deduction in non institutional Medicaid.
  • Guardianship fees are only allowed in institutional programs with the limitations indicated above.
  • For individuals on MPC residing in an ALF, an ETR referral can be made to the HCS Regional designee. Before considering an ETR, consult the social worker about the possibility of services through the COPES Waiver if the client would have available participation that we could apply the guardianship fee deduction.
  • COPES Waiver cannot be used for Adult Residential Centers (ARC), but can be used for Adult Family Homes (AFH).

Example #1 MPC client on G03 program residing in an adult family home.

Gross income is $1500 SSA.

Court order for $175 guardianship fee received.

Rather than doing an ETR to consider a deduction from the G03 room and board, this case should be switched to the COPES Waiver if the client meets the functional criteria.

The $175.00 would be an allowable deduction from the COPES Waiver.

HCS Social Services determines the client cost of care for MPC, but in this circumstance a discussion with the financial worker and social worker should occur about the possibility of COPES Waiver services.

The COPES Waiver is considered the priority program over MPC for:

  • Clients meeting functional criteria for COPES and
  • Have income over the CNIL and
  • Reside in an adult family home.

Example #2 MPC client on G03 program residing in an ARC.

Gross income is $1500 SSA

Court order for $175 guardianship fee received.

Waiver services are not authorized in an ARC setting, only MPC. An ETR to consider a deduction from room and board should be considered by the HCS Social Worker.

The COPES Waiver is considered the priority program over MPC for:

Clients meeting functional criteria for COPES and
Have income over the CNIL and
Reside in an adult family home

Example #3 MPC client on S02 living at home.

Guardianship fees are not an allowable deduction for non institutional medicaid programs. An MPC client at home does not participate in the cost of personal care nor is there room and board. In this example there is no deduction for the guardianship fee.