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Many of us think if we’re eligible for Medicare then we’re also eligible for Medicaid which is not true. Very few know of our population understand these very different programs. I am going to attempt to explain that difference without putting you to sleep.
MEDICARE: At the age of 65 every US Citizen and Green Card holder, receives a present from the USA, a Medicare card. A “fun fact” about Medicare: President Truman advocated for a national health care system, but Congress would not pass the bill. President Kennedy then took it up changing its application to citizens over 65. It still didn’t pass. President Johnson finally signed the bill into law in 1965. He flew to Independence, Missouri where President Truman and his wife, Bess, lived. The bill was signed into law in their presence and President and Mrs. Truman received Medicare cards #1 and 2!
Part A covers 80% of your hospital stays, 100% of skilled nursing care and non-custodial nursing home care (up to 3 to 4 weeks).
Part B covers services or supplies that are needed to diagnose or treat your medical condition and that meet accepted standards of medical practice. It also covers preventative health care like the flu vaccine or procedures that detect illness at an early stage (MRIs).
MEDICAID: Medicaid is a state administered program with some funds coming from state taxes and other funds coming from federal Medicaid grants given to needy states. (In other words, the poorer the state the more available federal funds.) The benefits are intended for low-income patients who cannot otherwise afford medical assistance. To be eligible for Medicaid, you must meet a mandatory list of standards that are partially enforced by the federal government.
Again, you must be a US Citizen or Green Card holder to be eligible. For the purposes of seniors, they must be in a nursing home facility or receive “home or community-based care.” There is also a Medicaid waiver which allows the ill person to stay at home or in an ALF. The applicant cannot have assets or income over the poverty level if they want to qualify.
Here is the kicker – qualifying for Medicaid triggers a five-year look-back to ascertain that you have not recently impoverished yourself by transferring assets to others. In the state of Florida, there is also a spousal refusal which simplifies asset transfers. There is no limit on gifts between spouses, this allows the sick spouse to transfer all his/her assets to the healthy spouse with no consequences. Because Florida allows spousal refusal, the healthy spouse can disallow the assets in his/her name to be counted for purposes of qualifying for Medicaid.
It’s exceptions and quirks within each state that makes estate planning necessary. There is no one plan that fits all needs, each situation calls for individual attention.
REMEMBER: AT 65 YOU QUALIFY FOR MEDICARE NO MATTER YOUR FINANCIAL STATUS. TO QUALIFY FOR MEDICAID, YOU MUST APPEAR TO LIVE AT OR BELOW THE POVERTY LEVEL AND AGE DOESN’T MATTER.
About Frances Reaves
A graduate of University of Miami Law School, Frances spent ten years as a litigator/lobbyist. Today, she is an accomplished business woman who, when her parents could no longer take care of themselves, learned the ins and outs of senior care (or the lack thereof). She founded Parent Your Parents to assist seniors and their children through the myriad of pitfalls and options of “senior care” in the 21st century. You can contact her at parentyourparents.com
