Medicaid and Long-Term Care Planning

Medicaid is a state-federal program that covers the acute and long-term care needs of low-income seniors. It is the largest fund for healthcare in the United States, and most low-income seniors rely on it to cover long-term care services.

Eligibility for Medicaid is complex, and it depends on various factors, including one's age, income, and assets. Individuals can apply for Medicaid if they are 65 or older (or younger if they are considered disabled) and have a qualifying medical condition that requires long-term care.

Applicants for Medicaid must also meet certain asset limits. These asset limits are set by the state and vary from state to state. They include the total value of financial assets, as well as home equity and personal property. In order to qualify for Medicaid, an applicant must "spend down" their excess assets. This is done by paying for long-term care, making home improvements, purchasing an irrevocable funeral trust, or transferring assets to a family member.

Asset Transfers to Family Members

There are several ways that individuals can legally transfer assets from themselves or their spouses to a designated family member who can be a caregiver, without impacting eligibility for Medicaid. The most common approach is repositioning assets into a non-countable trust, often called a Miller Trust or an Income Cap Trust. Typically, this can be accomplished in a very short period of time and may even lower an applicant's countable income.

Planning for LTSS Needs

There is a wide range of community-based and institutional long-term care services and supports that individuals can receive through their Medicaid benefits. This ranges from basic in-home care to assisted living programs, to nursing homes and home health aide services.

In addition to these services, many states offer programs that are designed to help individuals remain in their own homes and maintain a higher level of independence. These programs can include home health aides, specialized nursing care, and mental health adult day services.

These programs are generally less expensive than assisted living and nursing home care, but they can still be costly. Therefore, it is important to consult with an experienced geriatric care manager or case manager about the services available to help you or your loved one.

The Medicaid system provides the primary funding and financing for institutional and community-based LTSS for people with chronic and disabling conditions. As baby boomers age and people with disabilities and chronic illnesses become frailer, Medicaid will likely continue to play a major role in financing the need for LTSS for millions of Americans.

Increasingly, the availability of technology and assistive devices for independent living is providing people with disabilities more opportunities to remain in their own homes and continue to live with their families. As a result, the need for LTSS is expected to increase significantly in the coming decades.

However, despite the growing need for LTSS, there are limited public or private coverage options for these services and supports. As such, policymakers and other stakeholders will likely continue to explore options for reforming the nation's LTSS systems.

What Does Medicaid Not Cover?

The federal government and state governments each provide a share of Medicaid funding to help states meet their obligations under the ACA (Figure 2). While the federal government provides matching funds for most services provided under the Medicaid program, states have broad discretion in deciding who is eligible, what services they will cover, and how much to pay. In addition to the ten “essential health benefits” that must be covered, each state decides which optional benefits it will offer.

What Does Medicaid Not Cover?

Medicaid covers various medical and long-term services and supports for low-income people, including home and community-based care and institutional care, such as nursing homes and intermediate care facilities. It also assists with the costs of private health insurance for some beneficiaries, especially seniors and people with disabilities.

In the LTSS category, long-term care services and supports (LTSS) span from home and community-based service (HCBS) to nursing facilities and intermediate care facilities for individuals with intellectual disabilities (ICF-ID). Institutional LTSS accounts for most of all LTSS expenditures, although HCBS has increased dramatically since 1995.

What Does Medicaid Not Verify?

Like all means-tested programs, Medicaid requires extensive documentation to determine eligibility. This includes evidence of identity, residence, citizenship, disability if an applicant claims to have one, marital status, income and resources, and, in some cases, other information that may be relevant.

Oftentimes, the applicant’s Social Security Number is used to search for information in the Internal Revenue Service database that can help verify eligibility. If the applicant’s records cannot be verified, the applicant may be required to provide substitute evidence.

What Does Medicaid Not Reimburse?

Unlike Medicare, which provides a set amount of coverage for certain services and procedures, Medicaid acts as a payer of last resort for most medical expenses. This is because it is the legal responsibility of other sources to pay for a beneficiary’s medical costs before Medicaid can reimburse them.

This is why it is important to keep receipts and show them to Medicaid when requested. It also helps to understand the Medicaid spend-down program, which deducts expenses a household incurs that exceed its monthly income limit from its overall household income.

What Does Medicaid Not Pay?

Medicaid is the largest public payer of health services in the United States. Its spending accounted for $577 billion of the total spending on domestic programs in FY 2017.

The majority of Medicaid expenditures are paid through federal and state Medicaid programs, with federal funding making up a substantial portion of the cost of providing Medicaid-covered services to low-income people. Sometimes, Medicaid pays for services through managed care contracts or premium assistance programs with third-party payers.

The federal government’s share of Medicaid funding, however, is limited to a percentage that varies from state to state and year to year. As a result, the overall Medicaid budget can be significantly affected by state policy decisions. In addition, some states have obtained waivers to charge higher premiums and cost-sharing for certain populations. These waivers target expansion adults but also apply to other groups eligible through traditional eligibility pathways.

I Am a Veteran. How Does This Impact Medicaid?

If you are a veteran, you may qualify for VA health care. There are several types of medical services available through the VA, including primary care physicians, specialists, and outpatient therapy. For most veterans, VA pays for the full cost of medical services and prescriptions. However, some veterans will have to pay a copayment for certain services.

Eligibility for VA healthcare is based primarily on military service. In addition, some other requirements apply, such as being discharged from the military under special circumstances and having a service-connected disability.

Depending on the type of health care you need, the VA provides services at its medical centers, clinics, or vet centers and in the community. To find a location near you, visit the VA facility locator.

Qualification for VA benefits depends on a complex system that considers several factors, including service-related conditions and income. The VA also sets up priority groups for enrollment.

Priority Groups range from one to eight with the highest priority being assigned to those with a service-connected disability. The VA sets up these priority groups to make sure that certain veterans get the healthcare they need.

The Priority Groups include:

Complete health care - Physicians’ care, labs, testing, hospital care, prosthetic devices, durable medical equipment, and long-term care.

Other benefits - Eyeglasses, hearing aids, dental care, and more.

Inpatient and outpatient care – The VA provides in-patient and outpatient care, including doctor visits, physical therapy, emergency care, surgery, and mental health care.

Prescriptions - The VA pays for most prescriptions, including over-the-counter medications and vitamins.

Surgical care and other special treatment - The VA provides surgery to those who are service-connected or have been discharged under a special reason for discharge (such as an honorable discharge or under a condition other than dishonorable).

Homecare and hospice - The VA provide in-home health care for veterans who can no longer live at home.

Life insurance - Low-cost life insurance coverage is available for veterans and their dependents.

Burial Allowance and Veteran Cemetery - The VA provides partial reimbursements to eligible veterans for burial and funeral expenses.

Family Support - The VA helps veterans and their families with child care, housing, and more.

Enrollment and eligibility for VA health care is a complicated process that involves a lot of paperwork. You must provide copies of your service and health records, discharge papers, a Social Security card, and other documentation.

The process can take weeks or months to receive a decision on your claim.

Do not be discouraged if you don’t see the answers you need right away. You must be patient, and be sure to ask questions.

Medicaid is a state-run program that provides health care to low-income people who need it. The State determines who is and isn’t eligible for Medicaid.

While waiting for your official determination of benefits, you can use the VA’s online Health Benefits Explorer to learn about your options. The website also offers a calculator to help you find out the income thresholds that will allow you to receive certain benefits.

New York Legacy Lawyers by Yana Feldman & Associates PLLC

New York Legacy Lawyers by Yana Feldman & Associates PLLC

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