Rules of Eligibility on Medicaid
Rules of Eligibility on Medicaid
You don't get to choose how you're going to die, or when. You can only decide how you're going to live.
- Joan Baez
Medicaid, which is distinct from Medicare, provides health coverage to nearly 60 million children, families, pregnant women, the elderly, and people with disabilities. Medicaid covers US citizens and eligible immigrants and is generally provided for low income citizens.
Medicaid can pay for nursing home costs for senior citizens with few assets and low income. In some cases, this applies to senior citizens who have already spent almost all their savings paying their residential facility or home care and cannot sustain the expense.
In the case where one spouse lives at home and the other in a long term care facility, Medicaid can allow more assets to be retained while still qualifying for Medicaid. Planning plays an important role so that Medicaid can pay the nursing costs of for an elderly patient in a medical facility.
When does Medicaid Pay for Assisted Living or Nursing Home?
Medicaid provides for people with low income and limited assets. The program is a joint project by the state and federal government to assist senior citizens in terms of their assisted living care or nursing home needs. The state administers the program and has certain requirements for an elderly to qualify for the benefits.
Long Term Care Requirements
Long term care consists not only of medical care but also personal services for people who are ill and disabled.
State Provided Medicaid
Medicaid recipients will avail of the nursing facilities provided by every state for free. The state will also pay for the home health care services of the recipients who qualify for nursing home care. Medicaid funding can be used by the state to provide long term care services like health aides to those who are not qualified for assisted living facilities and in-home services.
Facilities Accepting Medicaid
Since Medicaid has certain mandatory federal requirements, not all nursing home or assisted living facilities accept Medicaid payments. There are facilities that accept Medicaid and they are subject to periodic inspection to make sure they meet the federal standards set by the state. You need to check with the facility to determine if they take Medicaid patients.
Medical Eligibility
Seniors are not the only persons assisted by Medicaid. Adults and young children who have needs for a nursing home care are also medically eligible for Medicaid after satisfying the requirements of the state. As long as it is proven "medically necessary" for a patient to be placed in a nursing home or health care facilities, and you meet the asset and income criteria, Medicaid will shoulder the expenses.
Financial Eligibility
Depending on the state where you are residing, Medicaid eligibility is set by the federal SSI (Supplemental Security Income). SSI also set the income limits.
Income Limits
Flexible medical guidelines are available in most state for long-term Medicaid reimbursement. These income guidelines depend upon the type of the long term program being applied for and used.
"Medically Needy" Guidelines
"Medically needy" refers to those people who have high income and assets yet their medical expenses are also very high. This means that their income is reduced. In Medicaid terms, this is referred to as "spending down".
Resource Limits
A person who has "spent down" would be eligible to qualify for Medicaid assistance. This is after a person's assets are higher than the Medicaid resource limit.
Asset Transfer
You can diminish your assets or do whatever you like while you are "spending down", getting below the qualifying asset criteria for Medicaid. However, you may not give away assets for less than market value. Medicaid will track your finances for the past five years to determine if your transferred assets in order to qualify for Medicaid. If they determine that you have done so, you will be ineligible to apply for Medicaid for a certain period. Penalty charges may also apply, even after restrictions are lifted and you will legally qualify for Medicaid assistance.
Contribution to Cost of Care
Before Medicaid pays for your care, they expect your available income would go to the long term medical care at a nursing home or other healthcare facility and you will only be allowed to keep a small fixed amount for your "personal needs allowance".
The amount that you will be allowed to keep will depend on state laws and the arrangement you made with your healthcare facility. Arrangement can also be made for persons with more than what is allowed for Medicaid eligibility assets to put it in a trust in order to qualify for Medicaid.
When the person dies, the trust proceeds will be paid to any long term medical care that was provided for by Medicaid. The rest, which may not be much, will go to the heirs.
Spousal Improvised Protection
Married couples who have one member needing a long-term care services will not be required by Medicaid to give up assets and income in order for the other who need health care to qualify for Medicaid. The healthy spouse is still allowed to live in the community and keep assets ranging from $22,000 to $110,000 depending on the state rules.
Future Medicaid Claim against Your Estate
Medicaid will claim your estate only if:
• You are 55 year old and receiving long-term medical care
• You are permanently institutionalized before you turn 55 year old
• If you pass away, Medicaid will have a claim on your estate for the amount they have spend to care for you (Medicaid estate recovery)
Medicaid will only claim your estate after your remaining spouse dies and you have not left behind any minor or disabled children.