An Introduction to Medicaid
Delving into the largest payer of long-term care
What Is Medicaid?
Medicaid is a federal and state program that provides healthcare coverage for a variety of individuals and families with limited income and resources, including the elderly, blind, and disabled. In fact, Medicaid pays for over 40% of long-term care costs in the United States.
What Does Medicaid Cover?
In the context of long-term care, Medicaid covers the entire cost of care, including room, board, pharmacy, and incidentals, minus a small co-pay in some cases.
In order to qualify for Medicaid, applicants must meet strict eligibility requirements, which vary by state. Fortunately, when you work with an elder law attorney, they will be well-versed on the Medicaid rules you need to follow.
To meet the non-financial requirements for long-term care Medicaid, you must be:
- A U.S. citizen or qualified non-citizen
- Age 65 or older, blind, or disabled
- Residing in a Medicaid-approved facility
Income In most states, the Medicaid recipient's income must be less than the cost of the nursing home. Since the monthly bill is typically $8,000 or more, most seniors easily meet this requirement. For married couples, the healthy spouse has no limit on their income.
Assets In most states, the Medicaid recipient can keep $2,000 in countable assets. For married couples, the healthy spouse is able to keep a much larger amount. This allowance varies greatly by state but can exceed $100,000 in many cases.
Gifts Some applicants may be tempted to give away assets in order to meet these requirements. However, Medicaid has rules against this and will delay eligibility for a certain period if the applicant or their spouse made any gifts in the previous five years.