Saturday, March 12, 2016

What is Medicaid and why would my parents need it for nursing home coverage?

Medicaid (called "MassHealth" in Massachusetts, and "Ritecare" in Rhode Island) is a joint federal-state program that provides health insurance coverage to low-income children, seniors, and people with disabilities. Importantly, unlike almost all other forms of health insurance it covers long-term care in a nursing home for those who qualify.
Because the costs of private long-term care insurance are often too expensive for many families, and because other publicly subsidized programs like Medicare do not cover long term care in a nursing home setting, Medicaid has become the default nursing home insurance for those who can’t afford to pay the approximately $10,000 per month cost of nursing home care. As a result, many people pay out of their own pockets blowing through a life-time of savings for long-term care until they become eligible for Medicaid.
Although their names are confusingly similar, Medicaid and Medicare are very different programs. For one thing, Medicare is an "entitlement" program, that means that all retirees who receive Social Security benefits also receive Medicare as their health insurance. In contrast, Medicaid was initially intended as a form of assistance to the poor. So to be eligible for Medicaid, you must qualify by technically becoming "impoverished" under the program's rules. You can learn more about those rules here
Also, unlike Medicare, which is completely run by the federal government, Medicaid is run jointly by the federal government and the states. Each state operates its own Medicaid system, which must conform to federal rules in order for the state to be paid money from the federal government, which pays for about half the state's Medicaid costs. (The state must pay the rest of the cost for the program.) This complicates matters, because the Medicaid eligibility rules are somewhat different from state to state and the rules governing the treatment of asset transfers and homes of nursing home residents keep changing as states try to reduce the impact of these programs on their budgets. To be certain of your rights, consult an expert. He or she can guide you through the complicated rules of the different programs and help you plan ahead.
If you need assistance understanding how any of these issues impact you or a family member's eligibility for nursing home coverage through medicaid, or with a probate,  estate planning or other elder law matters call the offices of Fabisch Law, L.L.C. to set up a consultation with Rhode Island Nursing Home Lawyer Matthew Fabisch at 401-324-9344.