Payments for Pre-eligibility Medical Expenses (PEME) are available to individuals eligible for Medicaid who reside in a nursing home (NH) or an assisted living facility (ALF). This blog post attempts to clarify the procedure for processing requests for payments of PEME made by or on behalf of residents of NHs and ALFs.

Residents of NHs or ALFs may request that Medicaid pay PEME bills incurred up to three months prior to the date of eligibility for Medicaid benefits. The request is made by submitting a PEME form (see the last pages of Medicaid Communication 17-10, below) to the appropriate County Welfare Agency (CWA).

When the CWA receives a PEME form, the CWA will determine if the applicant has income available to pay the cost share amount computed by Medicaid. All individuals receiving Medicaid are required to pay a cost share every month they are eligible. (The “cost share” is the amount which the Medicaid applicant must pay each month towards the cost of care from his or her income.)  The monthly cost share payments are used to pay the PEME. Therefore, if the Medicaid applicant does not have sufficient income to pay the cost share, Medicaid will not pay the PEME.

When a PEME request is approved, the facility’s bills for the PEME period are added up and divided by the monthly cost share amount. This result will determine how many months the cost share will be diverted to pay the facility to satisfy the PEME bill.

Example: For the three months prior to date of eligibility, the ALF bills = $15,000 and the Cost Share = $1,500 per month. $15,000 / $1,500 = 10 months of PEME payments. The facility will receive the full payment for their services during the PEME months, in addition to the cost share, until the PEME bill is satisfied. For AL Facilities ONLY– Since Medicaid does not cover room and board for individuals living in ALFs, the room and board amounts must be paid for through the Medicaid recipient’s income.

PEME is not available to applicants in a penalty period resulting from a transfer of assets for less than fair market value.

The Medicaid Communication is attached here –

Download (PDF, 55KB)

For additional information concerning Medicaid and public benefits planning, visit:

NJ Medicaid and Public Benefits Planning