5 Common Misconceptions About Medicaid
I have a confession. I’ve been avoiding writing about Medicaid. It’s just so complicated it scares even me the expert. But Medicaid can be really important to daughterhood. Someday you might have to decide if it’s right for your parent. So, you have to get smart about it.
Why Medicaid is important? It’s important because it’s the safety net when everything falls apart.
When your frail mother has been caring for your Dad at home alone for five years and she can’t do it any longer. When 24 hour a day home care is too expensive, and still not enough to keep your dad safe. And, then when his nursing home care quickly depletes their savings.
Maybe you’ve only heard about Medicaid as a program that provides health insurance under Obamacare. Well, for much longer than we’ve had Obamacare, Medicaid has been paying for nursing home care and, sometimes, home care for people who are very frail or disabled and whose income and assets have either been depleted by the costs of care or who never had much money to begin with.
The challenge here is navigating this very complicated program to get the help you need. Among the many complexities you’ll face as a daughter, few are more daunting and flat out scary than pursuing Medicaid eligibility….
But, as I’ve said before, I believe that you always just gotta start — you just have to get in the boat and start rowing, and the very first thing you need to do is avoid the big misconceptions about Medicaid that trip up so many people.
Here they are:
Misconception #1: Medicaid is a lot like Medicare
Not true. MediCAID is nothing like MediCARE. And, it is not a substitute for Medicare. Medicare is the program that pays for health care — like doctors and hospitals — for everyone over age 65 and certain people with disabilities who are under age 65.
Read 4 Tips to Make You Smarter About Your Parents’ Medicare
But, Medicare does not pay for long-term care — meaning care your parent needs on a sustained and ongoing basis in a nursing home, an assisted living facility or even ongoing home care.
To get those services, you’ll either pay for them yourself or, if you are eligible for Medicaid, it will pay for some or all of them.
In fact, the good news is if you’re an older adult, and you become eligible for Medicaid, you keep Medicare. This means that you’ll receive coverage from BOTH programs.
That’s right. You can be covered by Medicare and Medicaid at the same time, for different things.
Misconception #2: Medicaid is available to everyone
Unlike Medicare, which nearly all of us will qualify for just by virtue of turning 65, Medicaid is VERY protective of who gets benefits. It’s a safety net program that is designed to swoop in when things are pretty tough.
So, it requires applicants to go through a challenging, complex, and often lengthy eligibility determination process.
In order to get your parent’s long-term care paid for by Medicaid, they have to meet these basic requirements.
They Have to Have a HIGH Need for Care. Medicaid rules require you to need a lot of help doing one, two or more of the most basic activities of daily life; like bathing, eating. Or they have a severe cognitive issue like dementia. So, your parent will have to go through a process in which Medicaid assesses their level of need.
Your Parents’ Income Has to be Too LOW to Pay for Care. Medicaid is saving its money for people who most need the program. So, you either have a low-income to start with OR, so much income already going to medical care or long-term care, that you don’t have enough to cover the full costs of your care.
They Have to Have LOW Savings. Medicaid requires that you to have very little savings in the bank – about $2000.
When it comes to income and assets, there are a lot of rules for lots of different circumstances.
For example, your parent can’t have just given you all their savings in order to qualify for Medicaid – at least not recently. Medicaid will actually go look at all your parent’s bank statements over the last five years and examine every little transfer they made.
Also, if the Medicaid applicant is married, their spouse does not have to entirely deplete his or her income and savings. The idea is that the non-frail spouse should not become destitute as a result of this process.
Misconception #3: Medicaid Will Take Your Parents’ Home
It IS true that Medicaid is not set up to spend millions of taxpayer dollars on someone’s care just to have that person’s family inherit a mansion when the person dies.
On the other hand, Medicaid rules do try to preserve the family home for your frail dad while he’s living. But states may put a lien on the house while he’s alive, and then try to use the asset to recoup for care costs after he dies. This can sometimes create a pretty tragic set of circumstances.
This is complicated and it’s also scary. It feels like very big stakes — especially when it comes to your parents’ lifetime savings and/or their home. It can be a shock to realize that your parents’ financial security and yours could be very connected.
This is where many experts and books will tell you to get a lawyer to advise you as you are going through this process. And, I tend to agree. You can start by checking out the website of the National Academy of Elder Law Attorneys (NAELA).
The problem though is that not everyone can afford a lawyer. If that’s the case, I recommend starting by consulting the free state health insurance assistance office in your parent’s state. These trained volunteers can either help you directly or help you drill down to other resources.
Misconception #4: Medicaid is a national program that’s the same for everyone
Part of what makes Medicaid really complicated is that it is NOT a national program with the same rules and requirements for every American. Unlike Medicare, which is a federally run program that applies the same rules and benefits to everyone, Medicaid is actually run by states, although the federal government does share the costs. The feds set a lot of rules FOR STATES and then states get to make many rules for themselves.
The reason any of this matters for you is that, if you are caregiving for a parent in a different state, you’ll need to understand the rules in his or her state. And, if you are considering moving your parent, you’ll – very unfortunately – have to compare the rules across the states.
Misconception #5: Medicaid only covers nursing homes
Medicaid has traditionally paid mostly for nursing home care. But, no one really wants to be in a nursing home.
So, some states operate home and community-based services (HCBS) programs. This is a very big topic for which I will write an entirely separate blog very soon.
But, in the meantime, to find one, I recommend that you start by asking about “HCBS programs” through the local area agency on aging (AAA). And you can find the AAA through this federal locator – click here.
But beware! Unlike nursing home care, state Medicaid programs do not HAVE to offer HCBS so the availability programs will vary depending on where you live — see misconception number 3.
What’s Most Important
When is Medicaid right for your parent? It depends on so many individual and family circumstances. And, it depends on your state. There are no hard and fast rules.
But, if you’ve been walking down this caregiving road for a long time and you are looking at nursing home care, Medicaid may be necessary to pay for that care. OR, if your parent’s money is running out because of expensive care — even if he or she isn’t in a nursing home — then it could be helpful, especially if there’s a good home and community-based services and supports Medicaid program in your parent’s local area.
As caregivers I know you’re already really tired and stressed. And, figuring this program out for your family is not easy. But you’ve GOT THIS.
Just remember that it’s a crazy complicated hard situation. And it’s that way for everyone, even experts! It’s not that you are failing. You are good and normal and doing everything you can. That’s all you can do.
I oversee both my brother (medicaid) and my father (medicare + supplemental insurance ) – it is a crazy and time consuming task. Often I find myself just holding my breath and praying that I have chosen correctly so that they both receive the best care possible. In the state of Ohio, there are several supplemental programs for those that qualify for medicaid. My advice – read everything. then re-read again and again. Ask questions and document.
Thank you for this blog. Because the facts about this subject are so complex, it seems important to listen and read about it on an ongoing basis.
I am 23 and live with my mother due to being laid off of job.
My Mother works. Am I entitled to Medicaid.
I have Medicare but was advised to apply for Medicaid to see if it could help me medically. I have diabetes , pulmonary hypertension, heart disease, and 3rd stage kidney disorder.
My husband is unemployed due to health reasons,I have an income of$2,178 monthly can we qualify for medicaid we are only two in the household.
Hi Melendre, I’m so sorry to hear about your situation. The problem is it’s really hard to say if you’re qualified for medicaid because there are a lot of things that go into Medicaid determination. You need to check with the state office on Medicaid – can’t hurt to get the process started now.
I am turning 65 got into a bad accident injuries for life . My daughter stays home to help me she was planning on having a baby before my accident so now she had her baby trying to find work from home I get $771 a month we barely make ends meet. My daughter was left money from her grandfather that is almost gone . I will be getting a settlement for $58.000 now that I can not touch being on SSI it will go into a pool but what about my daughter who’s gone through all her money her grandfather left her that money she had to go through it to take care of me when I was supposed to take care of the baby. Not fare I didn’t ask to be dragged by a car. We had a plan
Thank you for creating this Avenue. Finally, a place to read, become educated in the Medicaid Process and not feel so isolated in getting mom settled into her LTC Facility.
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On hbcs my wife is my caretaker she works for public partnership does her income hurt my chance of losing my helpmam
Some of a spouse’s income is protected – that is, not counted towards eligibility – but there are limits. Check with your state eligibility office to be sure.
How does Medicaid estimate the penalties of individuals who may give cash gifts that fall within the five year “look back” period?
Hi Stacey, this is a level of detail that requires a lawyer’s advice
Im getting around 15,000 from ssi and ssdi back pay. 2020. Woll i lose my medicaid health insurance? Im buying a car with ALL the 15,000.
Im very confused. My case eorket dorsnt call me back.
BTW im getting chemo. Rectal AND prostate cancer from fall of 2019.
The only asset i will have is a car and less than 2000 in bank.
I think we say that she needs to get verification from the state eligibility office on the use of the back pay. But our understanding is that she/he is eligible for Medicaid as long as she/he is enrolled in SSI and has less than $2000 in savings. The car should not count towards assets. But this is a little bit beyond my expertise.
hi, we have GC since last 5 yrs, We have no income.We lives with our Daughter,On TaxReturn we are dependents on our Son. Can we get Medicaid ?Thanks
living in Oregon – Mother in-law receives medicaid, disabled, lives in an assisted living facility and currently under the income restrictions. Her husband passed away and she “could” now receive $1500 more a month from a pension, which puts her over the income restrictions for Medicaid, (but still disabled) but won’t make enough to cover living and medical expenses. Any idea if she could still qualify and give all of her income except the $170 or will she be denied and have to private pay? I had thought about calling the state medicaid office to get some insight/help, but don’t want to provide names or raise any red flags.. trying this avenue, as it’s stressing me out.. thank you
This falls into the “legal advice” realm where you’ll really need to talk to someone who is familiar with Oregon Medicaid policy. Try looking here…https://www.naela.org/
Did the clawback period recently get reduced from 5yrs to only 3yrs ? As it relates to Medicaid eligibility?? Thanks
We’re not aware of the asset transfer timeframe being reduced from 5 to 3 years but we believe it may be different in CA (e.g., 30 months). These issues are quite state sensitive so it’s a good idea to check on your state Medicaid eligibility website for the exact rules where you live.
My brother was diagnosed with a mental disability about 10 years ago. He was on medicaid for a while. It was stopped because he’s able to work part time and he lives with my parents, who have a comfortable lifestyle. If something happened to them, there’s no way he could support himself. Does he have to wait until something happens to them to get on medicaid again? I just hate the thought of others abusing medicaid when he truly needs it to live independently. Is there a political party that is stricter on medicaid eligibility than the other?
Your brother will be automatically eligible for Medicaid if he qualifies for Supplemental Security Income (SSI). SSI is an income support program for people with very low incomes and few assets. The nice thing about SSI is that it qualifies someone automatically for Medicaid. The bad thing is that you can’t earn very much money or you don’t qualify. It can be hard for someone to live on an SSI check but often people with mental disabilities will live in “group homes” that get paid through a combination of the SSI check and Medicaid. These group homes can have waiting lists so it might be good to sit down with a Medicaid eligibility specialist or a community-based organization that represents people with mental disabilities to see what they suggest. Bottom line is that there’s no clear answer because much depends on where you live. Some states are more generous than others. In my experience, few people abuse Medicaid.
I love when people complain about these programs. We are lucky to have them. If we didnt alot more people would die because bad things happen in life. If you don’t like medicaid start your own program. If you don’t like that the cancer drug somebody else invented is expensive invent your own drug. I know I’m being overly harsh it it’s for effect because people need to seriously reevaluate how we are dealing with life and who we are blaming for things and the personal responsibility that seemingly doesn’t exist anymore.
I had my 95 year old mother living in an apartment across from me. I went to her appt one morning and found her on the floor unable to get up with a black eye. I have a power of attorney and i had to call an ambulance to get her up and take to the hospital. Due to Covid this year I was not able to get my mom out and about so her muscles in her legs got so weak she was wobbling all over the place. Needless to say the hospital agreed that she needed therapy. She also has memory issues so I really had not choice but to place her in a nursing home permantlly. She only receives SSA and a few investment funds that still come out to less that $2000.00 plus her insurance supplement takes $300.00 of that. She does have about $6000.00 that I have taken out of the bank which is just odd savings. Is there someplace I can put it to keep medicaid from claiming it and not qualifying her. She has no other income besides her burial insurance.
Hi Rebecca, By law, asset transfers have to take place fairly far in advance of Medicaid eligibility to be excluded from the “spend-down” requirements. you probably don’t want to pay a lawyer to advise you about $6,000 but every state has different rules about financial eligibility and there may be some opportunity to put the money in trust for her to use for incidental living expenses. If you transfer the money to your bank account, most likely the state will try and recoup it. But again, please do consult a family lawyer for a more precise answer.”