Strategies To Achieve Medicaid Eligibility for Nursing Home Care in the United States

Nursing home care in the United States is expensive, making it challenging for any family to cover it. This makes “nursing home care” a significant consideration for families considering long-term care options. Fortunately, most people can arrange their assets and income to become Medicaid-eligible to plan for the astronomical costs of nursing home care in the U.S. But, first, why is nursing home care so expensive?

Long-term care, like a nursing home or home care nursing, is expensive because it requires specialized training, staff, and medical assistance. Not only are skilled nursing staff required to provide care 24/7, but the facilities are also expensive.

For example, a typical nursing home has an annual operating budget of well over $6 million, including utilities, insurance, staff salaries, and medications. This financial burden significantly contributes to the high cost of nursing home care.

How Much Does Living in a Nursing Home Typically Cost per Day? 

The median cost of a private room in a nursing home is about $253 per day or over $92,000 per year. A semi-private room costs a bit less, at a median of $235 per day, or over $85,000 annually. So, how can the average person or family afford such high costs of nursing home care?

In the United States, many turn to Medicaid, a federal and state program that helps with medical costs for some people with limited income and resources. For example, under U.S. law, specifically the Medicaid program provisions, certain services are considered mandatory for nursing home care coverage, including nursing facility services and home health services. This assistance significantly eases the financial burden on individuals and families, making quality nursing home care more accessible.

What is Medicaid?

Medicaid is a government health insurance program in the United States designed for low-income people and few resources. Among other healthcare benefits, Medicaid helps pay for long-term care. This includes nursing home care, in-home care, and hospice care. 

An example of this in practice can be found in the U.S. Social Security Act. Under Title XIX of the Act, Medicaid provisions are designed to afford recipients access to essential healthcare services. In the context of long-term care, this means the program can cover the costs of services like nursing home care for eligible individuals. This can significantly alleviate financial strains for those in need, ensuring they can receive the appropriate care without debilitating expenses.

What is the difference between a Nursing Facility and a Specialized Nursing Facility? 

The Medicaid program in the United States will only pay for care received in a nursing facility that is licensed by the state. However, there is a distinction between a standard nursing facility and a specialized nursing facility. A specialized nursing facility must meet additional federal requirements, providing a higher level of care than a regular nursing facility. This can include more intense or specific care regimens, often essential for patients with particular medical conditions or needs. 

For instance, in the context of “nursing home care,” a Skilled Nursing Facility (SNF) is a specialized nursing facility under U.S. law. According to the Social Security Act’s provisions, SNFs must provide nursing care, physical, occupational, and speech therapy alongside other services. These facilities serve patients who require a higher level of medical attention and rehabilitation, thus differentiating them from standard nursing facilities. By understanding these differentiations, recipients can better select suitable facilities for their nursing home care needs.

How does one become Medicaid-eligible?

To be eligible for Medicaid coverage of nursing home care, an individual must meet specific asset and income requirements under U.S. law. Medicaid will consider an applicant’s countable assets, including cash, bank accounts, investments, and property. Moreover, Medicaid will evaluate an applicant’s income to ascertain eligibility. 

For instance, under U.S. law, specifically the Federal Medicaid statute (42 U.S.C. §1396p), an individual’s income and resources are examined to determine whether they qualify for Medicaid. The legislation also defines what is considered an asset, including guidelines for assets that can be excluded from consideration, such as a primary home under certain conditions. 

In general, Medicaid requires that an individual’s income be below a certain level to qualify for coverage, including nursing home care. Be aware that these income and asset limitations can vary from state to state, as states have flexibility in administering their Medicaid programs within the broad federal guidelines.

What are the initial Medicaid eligibility requirements for nursing home care in the United States? 

To be eligible for Medicaid coverage of nursing home care in the United States, an individual must be:

• A U.S. citizen or legal permanent resident;
• 65 years of age or older;
• Disabled, as determined by the Social Security Administration. 

For most people, private long-term care insurance, which often covers nursing home care or home care nursing, is not an option, as the premiums are too expensive. Long-term care insurance typically only pays for a portion of nursing home costs and has many exclusions and loopholes. 

For example, most policies have a “look-back” period, which means that if you have had any kind of health issue in the past five years or so, your policy may not pay out at all. This is why Medicaid becomes a significant resource for many individuals requiring long-term care, such as nursing home care or home care nursing.

So how can you arrange your income and assets to make you eligible for Medicaid coverage of nursing home care? 

So how can you arrange your income and assets to make you eligible for Medicaid coverage of nursing home care? The following is a brief description of just a few of the most common strategies:

1. Give away your assets. You can give away your house, car, bank accounts, and other valuables to your children or other family members. The government imposes a “look-back period” of five years, so any gifts made within five years of applying for Medicaid will be considered part of your countable assets. 

2. Put your assets into a trust. You can create an irrevocable trust and transfer your assets into it. This type of trust is not counted as an asset by the government, so you can still qualify for Medicaid coverage for nursing home care. 

3. Spend down your assets on long-term care costs. This means using your assets to pay for nursing home care or other long-term care services such as home nursing care. Once your assets are depleted, you will then be eligible for Medicaid coverage.

4. Apply for a Medicaid waiver. A Medicaid waiver allows you to receive long-term care services at home or in the community instead of in a nursing home. This can help you avoid having to spend down your assets to become eligible for Medicaid coverage. Therefore, this option can be beneficial for those who prefer nursing care at home.

5. Purchase a long-term care insurance policy. This type of policy can pay for nursing home care or other long-term care services like nursing care at home if you need them in the future. If you have a long-term care insurance policy, you may not have to spend down your assets to become eligible for Medicaid coverage. 

These are just a few strategies you can use to become Medicaid-eligible for nursing home care in the United States. There are strategies that elderly Americans can use to meet Medicaid eligibility requirements for nursing home care in a more comprehensive approach. One such strategy is to work with a Medicaid planner. Medicaid planners are professionals who help people navigate the Medicaid eligibility process. These professionals are typically lawyers and work in several interrelated fields of law. This includes elder law, estate planning, tax, and probate.

Medicaid is a complex program, and many rules and regulations govern eligibility. Working with a Medicaid planner or other professional can help individuals navigate the Medicaid system and understand what options are available to them, particularly about nursing home care.

What is a Medicaid Trust? 

A Medicaid trust is a type of trust that can help you qualify for Medicaid coverage for nursing home care or potentially for nursing care at home. A Medicaid trust can be used to protect your assets from being used to pay for your long-term care costs, whether that care is provided in a nursing home or at home. By setting up a Medicaid trust, you ensure your wealth is preserved for your heirs while enabling you to meet Medicaid’s asset limit for care coverage.

What is Medicare?

Medicaid and Medicare are two different programs in the United States. You may qualify for Medicaid without having Medicare, or you may have both Medicaid and Medicare. Medicare is a federal health insurance program for people aged 65 or older, people under 65 with disabilities, and people of all ages with End-Stage Renal Disease. 

Medicare helps pay for some health care costs, including hospital stays, doctor visits, prescription drugs, and even some aspects of nursing home care or nursing care at home. There are two parts to Medicare: Part A and Part B. 

• Part A covers inpatient care in hospitals and skilled nursing facilities, including a nursing home. 
• Outpatient care, such as doctor visits, lab tests, and potentially some aspects of home nursing care, typically falls under Part B coverage. 

It’s important to understand each program’s specifics to fully leverage the coverage provided for various care facilities and services.

What is the difference between Medicaid and Medicare?

Medicare is a federal health insurance program for people who are 65 years of age or older or who have certain disabilities. On the other hand, Medicaid is a state and federal health insurance program for low-income Americans of all ages.

Medicaid pays for various medical services, including doctor visits, hospital stays, nursing home care, and even nursing care at home. It also covers prescription drugs. Medicare pays for some, but not all, of these services. The extent to which these services are covered can vary based on the specific program and the individual’s circumstances. Always verify which services are covered under each program to ensure you are getting the healthcare coverage you need.

How do I get Medicaid to pay for nursing home care?

It is crucial to find an experienced attorney or lawyer with experience in crisis Medicaid planning and tax law before applying for Medicaid eligibility for nursing home care. Medicaid, distinct from Medicare, is partially administered by the state within which you reside. This involves considerations of federal taxation, including assets, irrevocable trust creation, and developing a last will and testament. 

At the heart of these considerations is finding the best location for a loved one in a skilled nursing facility, getting Medicaid to cover the costs of nursing home care, and ensuring that your estate recovery department doesn’t repossess any money. Medicaid planning is a complex process that should be managed by those well-versed in Medicaid law, especially regarding nursing home care.

Medicaid and Medicare are elaborate laws that can be challenging to comprehend. Therefore, it’s essential to consult with an experienced attorney or lawyer before applying for Medicaid eligibility. Each state has different rules for Medicaid eligibility, and the process can be complicated, particularly when planning for nursing home care. You may need help from an expert in Medicaid law to ensure you qualify for Medicaid.

How do I get Medicare, rather than Medicaid, to cover the cost of long-term care? 

There are two types of long-term care options: skilled nursing facility (SNF) care and custodial care, which are significant elements in planning for nursing home care or home care nursing. SNF care is for people who need skilled nursing or rehabilitation services, whether in a nursing home or a home care setting. Custodial care, on the other hand, is for people who do not need skilled nursing or rehabilitation services but require aid with activities of daily living (like bathing, dressing, and using the bathroom).

Medicare does not cover custodial care, but it does cover SNF care, including nursing home care if you meet certain conditions. To get Medicare to pay for SNF care, you must be:

• Hospitalized for at least 3 days in a row;
• Discharged from the hospital to an SNF;
• Have a doctor’s order for SNF care;
• Be receiving skilled nursing or rehabilitation services;

If you do not meet all of these conditions, Medicare will not pay for your SNF care. However, Medicaid, under the right circumstances, will cover custodial care, including home care nursing.

Medicare’s Resource Limits (Part A) includes $0 in assets, $80/day personal needs allowance for Part A and B, $164/day maximum inpatient hospital coverage per benefit period. For those in New York State, Medicaid applicants seeking nursing home care must be below $2,000/month net income and have less than $1,500 in assets.

The Medicaid and Medicare programs are complex laws that make preparing for nursing home care and home care nursing, along with estate planning, a challenge. However, understanding the basics of these programs can guide you in planning. Medicaid eligibility forms a crucial part of elder law and estate planning.

Conclusion

Understanding the intricacies of Medicaid and Medicare, along with awareness of strategies to become eligible for such programs, is paramount when planning long-term care. As the costs of nursing home care and comprehensive home care nursing continue to rise, many Americans are turning to these governmental programs for aid. Applying for Medicaid or Medicare involves thoroughly evaluating an individual’s income, assets, and residential status. Moreover, the differentiation between the types of care facilities and the level of care they provide plays an integral part in this process.

Working with professionals such as Medicaid planners or estate attorneys can significantly simplify the task, guiding individuals and families through complex legislation and eligibility requirements. This includes strategies related to asset distribution, Medicaid trusts, and understanding provisions within the Social Security Act. For additional guidance, resources like Lawrina and professionals specializing in fields like medical law offer a wealth of information and services for people seeking legal assistance in these areas. You can find lawyers who specialize in medical law on Lawrina.

Overall, as daunting as the process may seem, the potential benefits of becoming eligible for Medicaid and Medicare cannot be understated in the context of nursing home care or home care nursing. Whether you’re an older adult planning for future care or a family member seeking options for a loved one, knowing the ins and outs can leverage quality care and financial relief — ultimately leading to a secure and comfortable life during the golden years.