Medicaid is a joint federal and state program designed to help people with low incomes and limited assets pay for health care. In most cases, for eligible patients, Medicaid will cover the cost of a nursing home but not an assisted living facility. The laws governing Medicaid eligibility vary from state to state, even from county to county, and change frequently. An attorney who works with elder law can advise on a particular location’s requirements, as can a state’s Medical Assistance Office or Area Agency on Aging.
Some general guidelines apply. To qualify for Medicaid assistance with long-term care, a patient must meet basic Medicaid requirement, they must:
- be 65 or older
- covered by U.S. citizenship or immigration laws
- have a social security number
- be a resident of the applicable state
They must also meet rather complex functional and financial requirements.
A medical specialist can determine the patient’s needs and capabilities, usually focusing on what are known as Activities for Daily Living, which include eating, bathing, dressing, toileting, walking/mobility, and continence. After the patient’s ability to perform these tasks is decided, the specialist will make a determination about the need for long-term care.
Determining the specific financial requirements for Medicaid eligibility is complicated, to say the least. A patient must use up virtually all of their “countable assets” before they qualify. These assets include savings, retirement accounts, and most cash-value insurance balances. Certain “uncountable assets” can be retained. These include a home used as a primary residence, a car, burial arrangements, life insurance with a face value of less than $1500, and certain trusts.
Although some assets can be switched to the “uncountable” column before the need for Medicaid arises, this must be done well in advance—usually at least five years—so they don’t fall into what’s called a “look-back period.” An attorney specializing in estate planning or elder law can offer invaluable advice on handling assets in a wise manner, like our attorneys here at Surratt & Thompson in Winston Salem.
Assets held jointly with or belonging to a spouse further complicate matters. These are often included in the “countable assets” category, although most states have laws in place to prevent a spouse living independently from a Medicaid recipient from becoming indigent. A calculation to determine such a spouse’s Minimum Monthly Maintenance Needs Allowance (MMMNA) is used to provide necessary support.
In many cases, an “estate recovery” program will expect that Medicaid be reimbursed for payments using proceeds from the sale of a house after the recipient had died (except if the spouse is still living there). Many times, estate recovery comes as a surprise to children dealing with the administration of a deceased parent’s estate. If you find yourself in this situation, you can learn more about your next steps in our post What Do I Do When Mom (or Dad) Dies? or by calling our offices for more legal guidance.
The Best Advice?
Plan for nursing home care well before it’s needed, if at all possible. And to help you navigate the complexities of Medicaid eligibility, seek expert assistance.