Medicaid: What You Need to Know – Part One

Elizabeth A. Anderson, Esq., a partner and co-owner of our firm, was recently interviewed by Mike Henley, MD, who is a regular contributor to the journal The Analyst.  This journal primarily caters to professionals in the water engineering industry, but Mike strives to bring information to their readers regarding topics beyond water. Recently, Mike’s articles have focused on issues we all face when a loved one ages.

In the upcoming fall edition, Elizabeth’s conversation with Mike will be featured, but we have a sneak peek for you!

MH: What is Medicaid?

EAA: Medicaid is a needs-based program. It is a joint state and federal program that will, in essence, “cover the rent” at an assisted living or skilled nursing facility. Medicaid can also pay for in-home health aides or community-based care.

MH: How does one qualify to be on Medicaid and what are the requirements (financial and otherwise)? Is the application process simple, or is an outside professional needed?

EAA: There are many types of Medicaid programs and each program has its own requirement process.

Qualifying for Medicaid Long Term Care, the type of Medicaid that covers the cost of the care facility or in-home care for the elderly can be a little difficult. To qualify for Medicaid Long Term Care, a three-part test must be met.

First, the applicant must have a medical need. If the applicant is over 65 and having difficulty with at least two activities of daily living, such as bathing, toileting, dressing, eating, transferring, and mobility, the person will likely qualify.

Second, the applicant’s income must fall below a certain limit. Each of the fifty states has its own criteria, and these figures change each year. Medicaid uniformly, however, includes the same streams of income in this calculation: income from pensions, Social Security, and retirement accounts.

Third, the applicant’s assets must fall below a certain limit. A single (unmarried) applicant can only own $2,000 of assets. If a married couple is applying, they can have combined assets of only $3,000. If only one spouse is applying for Medicaid, the applicant spouse can have $2,000 of assets and the healthy spouse can have $137,400. These figures are based on the 2022 figures for the State of Colorado. Certain assets are considered exempt assets, such as a primary home, one vehicle, and prepaid cremation or funeral plans.

MH: If one is on Medicaid, what does Medicaid pay for? What will it not pay for? For example, if a nursing home costs $10,000/month, how much of that $10,000 is paid by Medicaid and how much by the patient?

EAA: For nursing home Medicaid participants, nearly all of a participant’s monthly income will be paid toward the cost of the nursing home care, and Medicaid will generally pick up the balance. Each state allows the Medicaid participant to retain approximately $30-$200 a month as a personal needs allowance.

MH: Does someone on Medicaid have to re-qualify yearly?

EAA: Yes. Medicaid eligibility does not automatically get renewed. Each year, a renewal form must be completed with the required supporting documentation for proof of income and assets.

MH: Is Medicaid only designed for older people in nursing homes or assisted living facilities? Or do they have programs for younger people as well?

EAA: There are actually dozens of different types of Medicaid programs. For instance, there are special programs for children, adults under age 65, parents and caretaker relatives, pregnant women, SSI-eligible persons, seniors, and individuals with intellectual or developmental disabilities. Each program has different qualification requirements. While, generally, the strictest qualification process is for assistance through the Medicaid Long Term Care program, it is important to find out eligibility for the specific program you are enrolling in.

Tune in to our blog next month for more of this interview!

(This information is based on an interview of Elizabeth Anderson with The Analyst for an article in the “Beyond Water…” column of the technical journal, which is available at AWT. Content is copyrighted (2022) to Elizabeth Anderson and MD Henley & Associates.)

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©2022, Elizabeth A. Anderson, The Law Network, P.C.

©2022, MD Henley & Associates.

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