When there is an immediate care need, there are choices to help you save money.

Medicare and Medicaid are two very different programs that cover different things. Let’s review what each program covers and does not when it comes to nursing home costs.

Medicare
Medicare consists of two parts Part A and Part B. You can also purchase private Medicare Supplement, Medicare Advantage, and Part D (Prescription Drug) plans that include additional benefits and reduced cost-sharing (copays, coinsurance, deductibles). In most cases, to qualify for Medicare, you must be 65 years old. However, there are some other ways to qualify, including permanent disability.

Medicare Part A (hospital insurance) covers Medicare in-patient care that is care received while in a hospital, skilled nursing facility, and, in certain circumstances, at-home treatment.

Medicare Part B (medical insurance) covers medical services provided by doctors, nurses, and other health care professionals. Part B coverage includes outpatient care, ambulance services, preventive services, and durable medical equipment. It also covers part-time home care and rehabilitative services, including physical therapy.

Medicare does NOT cover long-term nursing home or in-home care.

Medicaid
Like Medicare, Medicaid provides comprehensive in-patient health care coverage, including services and costs associated with nursing facilities and rehabilitation facilities. To qualify for Medicaid, you must meet certain criteria that differ from state to state, and the rules are incredibly complex. They are generally based on having very low income and assets. This is different from Medicare that generally uses age as the primary qualifying criteria.

Medicaid CAN cover long-term nursing home or in-home care provided you meet the criteria for needing long-term care.

Medicaid is the single largest payer of nursing home bills in America. It has become, by default, the long-term care insurance provider for middle-class Americans who can’t afford private Long Term Care insurance. The average cost of a nursing facility is $115,000 per year and rising. If you or a family member needs long-term care, it will not take long for the average family to deplete all of their savings. More than 68% of all nursing care recipients now rely on Medicaid to pay their Long Term Care costs. Working with a professional Medicaid planner is the best way to determine if you or your loved one can qualify for Medicaid and put plans in place to give you the best chance of preserving assets while still qualifying for Medicaid.

Financial Eligibility
The Affordable Care Act established a new methodology for determining eligibility for Medicaid, based on Modified Adjusted Gross Income (MAGI).  Medicaid will review both income and assets to determine eligibility for the program. 

Non-Financial Eligibility
To be eligible for Medicaid, individuals must also meet specific non-financial eligibility criteria. Medicaid beneficiaries generally must be residents of the state in which they are receiving Medicaid. They must be either citizens of the United States or certain qualified non-citizens, such as lawful permanent residents. Some eligibility groups are also limited by age, pregnancy, or parenting status.

The simple answer is yes. However, Medicaid does have strict guidelines around what you can protect and under what circumstances. You may retain assets and still qualify; If the applicant has a spouse, the Medicaid eligibility criteria may differ. A couple may keep assets up to $125,600, and home equity limits are as high as $552,000 (PA), $828,000 (NJ). Some exemptions allow spouses to keep resources and income from the applicant. Making a mistake and overspending resources may result in the spouse who still lives in the community, spending significant money that could otherwise have been funded through Medicaid. This can create a situation where the spouse no longer has adequate resources or income to live. Single applicants have options also. 

It is critical to work with a professional who understands the Medicaid rules to avoid common mistakes that can leave applicants vulnerable to periods of ineligibility and financial hardships.

Although Medicaid has asset limitations, you do NOT have to be poor to qualify. You can utilize Medicaid planning solutions to preserve what you have worked so hard for your entire life.  We work with families that have small and large amounts of assets.