Medicaid Long Term Care Coverage
Over the last few years, death rates have been declining -which means people are living longer. However, longer does not mean they remain very healthy till their last day – with age, old age issues, chronic conditions keep increasing, mental agility keeps deteriorating. The need for long term care arises at this stage. Younger adults may also need long term care services at any time of their lives while recovering from a surgery or serious illness.
Long term care services are quite expensive – so long-term care insurance is the best solution to manage these costs. However, even the premiums of long term care insurance are very high and a lot of people find it impossible to pay them. Medicaid, the government-funded medical insurance program proves to be a savior for many when it comes to long term care services.
Medicaid, the public health insurance program for low-income people has been in existence since 1965 and provides both health and long-term care coverage to about 70 million people in the US. Both the federal and state governments contribute towards the program. Medicaid is the biggest provider of public long-term care coverage in the country.Medicaid reimburses the provider directly and does not pay the beneficiary.Medicare, the other government-funded health insurance program has insignificant long-term care coverage.
Eligibility for Medicaid Long-term Care Benefits
It is a known fact that Medicaid offers health and long-term care insurance to low-income people. There are strict eligibility regulations which are used to determine who can receive Medicaid benefits and who cannot.Medicaid segregates the recipients into three divisions-
- Categorically Needy –mandated by the federal government
- People with low-incomes who are eligible to receive state aid for their dependent children
- Those who receive Supplemental Security Income
- Those who receive assistance for adoption and foster care
- Infants whose mothers receive Medicaid coverage
- Optionally Categorically Needy – mandated by the state for their Medicaid program
- People whose incomes are below poverty level and are 65 years or older, blind or disabled
- People with limited income living in institutions
- Medically Needy –This includes people who have high medical needs but their incomes and assets are more than Medicaid limitations. Some states create special provisions for these people after considering their eligibility.
Medicaid eligibility rules are largely state-specific.Some of the general requirements for Medicaid long-term care benefits eligibility are as follows –
- The medical condition of the person needing long term care must be unable to perform the activities of daily living. Medicaid benefits cover both institutionalized care and home care.
- They have to belong to any of the groups mentioned above – medically needy or categorically needy
- The income of the recipients must be below the level specified by Medicaid
The eligibility for receiving Medicaid long-term care benefits is highly dependent on the amount of income a person has. Medicaid has laid down the sources of income which will be considered as the person’s earning while determining his or her eligibility. The following are considered as countable income of a person who wants to get Medicaid long-term care benefits.
- Wages, with some deductions
- Social Security benefits
- Interest and dividends earned
- Veterans’ benefits
Medicaid also takes into consideration the assets owned by a person seeking Medicaid long-term care benefits. Non-resident property, cash, checking and savings accounts, stocks, mutual funds or other similar investments etc. are considered as countable assets. In order to be eligible for Medicaid long-term care benefits, a person cannot have more than $3000 in countable assets. Primary residence, automobile, life insurance policies, household objects, personal belongings etc. are exempt from the list of assets that Medicaid considers during eligibility.
Meeting Medicaid Long-Term Care Eligibility
If someone has more assets than $2000 or $3000 which is the Medicaid limit for eligibility, then he or she has to spend down and deplete the assets till it meets the Medicaid criteria. A person may spend down in any way but cannot transfer assets in order to touch the eligibility threshold. A person cannot transfer his or her assets to anyone within the last 60 months before applying for Medicaid benefits. If there is a transfer, the recipient has to wait out the waiting period before he or she can start receiving Medicaid long-term care benefits.There are certain conditions under which the person may transfer his or her home without paying the transfer penalty.
Medicaid Regulation for Spousal Income and Assets
In case of married couples, any income or asset owned or earned solelyby the community-spouse, who remains at home while the other spouse is institutionalized, is not considered while estimating income or asset for receiving Medicaid long-term care benefits.
Estate Recovery Program for Medicaid Long-Term Care Benefits
Medicaid has a provision to recover the expenses paid by it towards long-term care benefits, after the death of the beneficiary. This is done by liquidizing any asset the person had during the time of his or her death.All expenditure made on behalf of the person, nursing home stay, community-based care or home care can be recovered by the state. Not only for long-term care services, Medicaid can recover all medical expenses made for the person who received Medicaid benefits. However, the estate recovery process is subject to some regulations which safeguards the interests of the surviving spouse or children under 21 years of age.
Even though Medicaid has many strict regulations for eligibility -any low-income person cannot qualify for Medicaid long-term care benefits- it is still the best and only option for many people who cannot afford long- term care costs or long-term care insurance. A huge number of people are getting the much-needed care in various institutions, community-based centers or at home as a part of Medicaid long-term care benefits.
More Useful Links:
Long Term Care Services and Providers