Medicare, Medicaid and The Rules for Nursing Home Coverage
The Rules for Nursing Home Coverage:
An Overview of What’s Covered and What Isn’t
What’s a senior to do if they can no longer live at home due to illness or the general effects of the aging process, yet they don’t have the financial resources to cover a stay in a nursing home?
According to the medicare.gov website, there are many ways to pay for nursing home care. Most people who enter nursing homes begin by paying for their care out-of-pocket. As they use up their resources (like bank accounts and stocks) over a period of time, they may eventually become eligible for Medicaid.
Medicare generally doesn’t cover long-term care stays (room and board) in a nursing home. Also, nursing home care isn’t covered by many types of health insurance. However, a senior shouldn’t drop their health care coverage (including Medicare) if they’re in a nursing home. Even if it doesn’t cover nursing home care, they’ll still need health coverage for hospital care, doctor services, and medical supplies while in the nursing home.
Help from your state (Medicaid)
If you’re a senior and you qualify for Medicaid, you may be able to get help to pay for nursing home care costs. However, not all nursing homes accept Medicaid payment.
Check with the nursing home to see if it accepts people with Medicaid, and if it has a Medicaid bed available. You may be eligible for Medicaid coverage in a nursing home even if you haven’t qualified for other Medicaid services in the past.
Sometimes you won’t be eligible for Medicaid until you’ve spent some of your personal resources on medical care. You may be moved to another room in the Medicaid-certified section of the nursing home when your care is paid by Medicaid. To get more information on Medicaid eligibility requirements in your state, call your Medicaid office.
Important Things to Know about Medicaid
Paying for Care
You may have to pay out-of-pocket for nursing home care each month. The nursing home will bill Medicaid for the rest of the amount. How much you owe depends on your income and deductions.
Your Home
The state can’t put a lien on your home if there’s a reasonable chance you’ll return home after getting nursing home care or if you have a spouse or dependents living there. This means they can’t take, sell, or hold your property to recover benefits that are correctly paid for nursing home care while you’re living in a nursing home in this circumstance. In most cases, after a person who gets Medicaid nursing home benefits passes away, the state must try to get whatever benefits it paid for that person back from their estate.
However, they can’t recover on a lien against the person’s home if it’s the residence of the person’s spouse, brother or sister (who has an equity interest and was residing in the home at least one year prior to the nursing home admission), or a blind or disabled child or a child under the age of 21 in the family.
Your Assets
Most people who’re eligible for Medicaid have to reduce their assets first. There are rules about what’s counted as an asset and what isn’t when determining Medicaid eligibility. There are also rules that require states to allow married couples to protect a certain amount of assets and income when one of them is in an institution (like a nursing home) and one isn’t.
A spouse who isn’t in an institution may keep half of the couple’s joint assets, up to a maximum amount, as well as a monthly income allowance. To find the maximum amount for 2016 in your state, call your state’s Medicaid office. You can also call your local Area Agency on Aging to find out if your state has any legal services where you could get more information.
Transferring your Assets
Transfers for less than fair market value may subject you to a penalty that Medicaid won’t pay for your nursing home care for a period of time. How long the period is depends on the value of the assets you gave away. There are limited exceptions to this, especially if you have a spouse, or a blind or disabled child. Generally, giving away your assets can result in no payment for your nursing home care, sometimes for months or even years.
Applying for Medicaid
Applying for Medicaid is not as difficult as many people may think. Each state has set their guidelines for who’s eligible for the program and if you fall within those guidelines you may qualify for coverage. Here are three things you need to do that will help determine if you can sign up for Medicaid coverage.
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See if your State Expanded Medicaid
As it currently stands, 29 states and Washington, D.C. have expanded Medicaid while 21 states have opted not to. Six of the 21 states that did not expand Medicaid are currently debating whether they will expand the program moving forward. These states are Alaska, Florida, Missouri, Montana, Tennessee, and Utah. You can check if you state expanded Medicaid by clicking here.
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Check Income requirements
The next thing you need to do after checking whether your state expanded Medicaid is check your state’s income requirements to enroll in the program. The 29 states and D.C. that expanded Medicaid have set their cap at 138 percent of the federal poverty level (FPL). That is, individuals making $16,243 and below a year would qualify for Medicaid in states that expanded Medicaid. That number rises as the number of individuals in your household. So, a family of four making $33,465 and below each year would also qualify for Medicaid. Remember that this is only in the states that have expanded Medicaid.
If You Live in a State that Didn’t Expand Medicaid...
then your income requirements are based off of the cap that was set before the ACA went into effect. This number is 106 percent of the FPL, or $11,670 for an individual and $23,850 for a family of four. You can see a full break down of income requirements for singles and families by visiting this web page.
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Apply for Coverage
After visiting that site and determining that you may qualify for Medicaid, then you need to apply in order to begin receiving coverage. To get started, go to Medicaid.gov or Healthcare.gov.
Upon becoming eligible for Medicaid, all of the patient’s income must be paid to the nursing home, except for a $50 per month allowance for personal needs and a deduction for medical needs, such as private health insurance premiums. If the nursing home patient is married, an allowance may be made for the spouse still living in the home.
If you need help locating a nursing home in your area, you can search online 24/7 at: AlternativesforSeniors.com.
BLOG Date: Tuesday, February 2, 2016
Writer: Ryan Allen