FAQ About Medicaid for Long-Term Care
Note: Medicaid regulations vary from state to state. This information is based on regulations in Pennsylvania. In PA, the Medicaid program is also known as Medical Assistance.
What is the difference between Medicare and Medicaid?
Medicare is health insurance and covers medical services such as physician appointments, therapy, blood tests, x rays, medical procedures and hospitalization. Medicare will sometime pay for rehabilitation in a long-term care facility for a period of 20 to 100 days, but not longer. In long-term care, Medicaid covers the cost of ongoing support services for daily functioning, such as room and board in a nursing home.
Is there a difference between Medicaid for services in the community and Medicaid for care in a facility?
Generally financial eligibility for Medicaid services in the community (waiver programs) requires that an individual’s income level be not more than $2,313/month in 2019 (which increases annually to equal three times the poverty level). Financial eligibility for care in a facility is based on assets as well as income. Each program also has eligibility requirements related to an applicant’s actual need for care.
What government agency administers the Medicaid program?
Medicaid is a federal program that is overseen by the Center for Medicare and Medicaid Services (CMS). In Pennsylvania, Medicaid is called Medical Assistance and is administered by the Department of Human Services (DHS).
Does Medicaid pay for assisted living?
In Pennsylvania, Medicaid funds are not available to pay for assisted living or personal care.
When is an individual eligible to receive Medicaid?
For Medicaid to pay for care in a nursing home, an individual recipient must be determined to need a nursing home level of care by a physician and the local Office of Aging. An individual whose income is not greater than three times the poverty level may keep up to $8,000 of total resources, but may otherwise keep only $2,400. The cash value of life insurance counts as a resource, but one car and a residential home does not count as a resource.
Are eligibility rules different for an individual who is married?
The criteria are the same for the applicant for Medicaid. However, excess resources may be transferred to a spouse, who is usually entitled to keep 50% of resources up to a maximum amount ($126, 420 in 2019). There is no maximum on a spouse’s income. An attorney who is experienced with Medicaid rules pertaining to long-term care can help to protect excess resources by converting them into allowable income for the spouse.
Are assets owned individually by a spouse, or jointly between a spouse and a nursing home resident considered for Medicaid eligibility?
Yes, all of these types of assets are included when calculating eligibility. One exception is an IRA which is owned by a spouse living in the community. Prenuptial agreements do not help to protect additional resources.
May a community spouse legally preserve assets for his/her own living expenses without spending all assets on the cost of nursing home care?
Yes, tools are available which help accelerate Medicaid eligibility and preserve assets. The assistance of an elder law attorney is recommended for this “spend-down” process.
What is the “look-back period, and how is it related to “gifting”?
The Department of Human Services will review an individual’s financial information for the 60 months (5 years) preceding the date of a Medicaid application. They are looking for transfers of assets in an amount of $500 or more in any one month to another person or trust without payment of just compensation, such as for providing services per terms of a written contract. Uncompensated transfers are known as “gifts.” Gifts are not illegal in the sense of causing a criminal charge against the Medicaid applicant or gift recipient, but they do create a significant penalty which may cause personal liability for the applicant’s children.
If an individual meets the financial criteria noted above, why might he/she be ineligible for Medicaid?
If an individual has transferred assets during the look-back period, an episode of ineligibility may occur unless that transfer can be offset by the analysis and strategy of an attorney who is knowledgeable about how DHS administers the Medicaid funds.
When should a family begin thinking about applying for Medicaid?
If a nursing home resident is not a millionaire, then a family should begin consideration of Medicaid immediately.
The Medicaid eligibility process is usually complicated. For additional general information for PA residents, please call our office (717-697-3223) for a free telephone consultation with our care coordinator, who can help you determine if it would be advantageous to meet with an attorney.