Here’s a fact you may not be aware of: More than 70 percent of nursing home residents are currently receiving Medicaid. Yes, you read that correct, 70 percent. And here’s something else: the remaining 30 percent of nursing home residents will also be on Medicaid within six to 18 months.
With the average monthly cost of a nursing home running $6,000 – $7,000 a month (and those figures may be on the conservative side, too, and may not include prescription medicine costs, which would drive the monthly tab even higher), a person can easily go through his or her life savings in a short amount of time.
When it comes to paying the monthly nursing home bill, there are different options to consider. Private pay is one solution. Unless you’re Bill Gates rich and it doesn’t bother you to write a $6,000 check each month, the average American will eventually go broke paying the monthly nursing home bill. A one-year stay at $6,000 a month equals $72,000 in one year’s time. How much you have in assets (checking, savings, etc…) will determine how long you – or a loved one – have the ability to write the monthly check.
What Is Medicaid?
The most common and well-known option is Medicaid. Signed into creation by President Lyndon B. Johnson in 1965, Medicaid is a joint federal and state health insurance program for individuals and families with low income and resources. It is jointly funded by the state and federal governments, and is managed by each state. The federal government provides does provide guidelines for states to follow.
Nursing home Medicaid is just one program within the overall Medicaid system. It helps hundreds of thousands of people every day. People served by Medicaid include lowincome adults, their children, and people with certain disabilities. Medicaid is the largest source of funding for medical and health-related services for people with low income in the U.S.
Who Is Eligible For Medicaid?
Certain criteria need to be met for Medicaid eligibility. The big looming issue is meeting the financial requirement. There is an age requirement, but more importantly, there is the financial requirement. A person can’t have a quarter-million in cash assets and real estate and expect to qualify for Medicaid. That won’t happen in any universe. In Medicaid language, that person would be over-resourced.
How much money and assets can a person keep and qualify for Medicaid? The amount varies from state to state. The national average is approximately $2,000, but Indiana residents, for example, can’t exceed assets of $1,500. A married couple with one partner in a nursing home is allowed to keep more than a single person applying for Medicaid. The at-home spouse, or the community spouse, is allowed to keep the home and a vehicle; a single person moving into a nursing home and applying for Medicaid would be required to get rid of his or her home and vehicle.
But don’t think dad or grandma won’t have any money while in the nursing home. Each month, a nursing home resident is allowed to keep a small amount of cash on-hand, which is referred to a personal needs allowance. That money can be spent on haircuts, manicures, the cable bill, going out to eat, etc… Again, the personal needs allowance amount varies, but generally ranges from $30 – $200 a month.
There is a common belief that there is a difference in the level of care between private pay and Medicaid. The answer is no. It’s illegal to discriminate against Medicaid patients, and illegal to give better care to private pay patients than to Medicaid patients. There could be one noticeable change from when a patient transitions from private pay to Medicaid: the patient may be moved to a different room or wing of the facility once Medicaid kicks in, just to free up a bed for a paying client. And to be honest, the frontline nursing home staff – the nurses, nursing assistants – don’t know which patient is private pay or who’s on Medicaid.
What Places Accept Medicaid?
Now, if you are searching for a nursing home or long-term care facility, it’s imperative to ask the staff if they do take Medicaid. The majority of nursing homes have a small number of Medicaid beds; they prefer private pay or insured patients over Medicaid patients for payment reasons. But there are some nursing homes that don’t have a single Medicaid bed. It’s not uncommon to move to a different facility because the first nursing home doesn’t take Medicaid.
How Does Medicaid Differ From Person To Person?
Medicaid is a blessing to so many people. It can’t be stressed enough to seek out professional help when considering applying for Medicaid. There’s one simple reason: Information. There is so much wrong or incorrect information circulating that it could fill the New York City phone book. People have heard and shared stories about Medicaid from well-meaning family and friends. These stories are often filled with inaccuracies and half-truths that frighten people into taking the wrong steps, such as giving, or gifting, large amounts of money to family. Similar stories have prompted people to assume that what worked for a friend will work for them as well. They may give their house or all of their assets to a child in hopes that impoverishing themselves will immediately qualify them for benefits.
Although Medicaid is a federal program, the issue of managing, supervising and overseeing Medicaid is the responsibility of each state, and rules are different from state to state, which is where some of the problem lies. What might work your favorite uncle in California, for example, may not work for your sister who lives in Texas or the cousin who lives in Virginia. So when you start to investigate the possibility of applying for Medicaid, it’s important to get correct state-specific information. Most state-run websites have general Medicaid guidelines and manuals to help you get familiar.
It’s important to do your homework: Consult professionals who know what they’re talking about. These professionals are out in your community. Go online and seek out elder law attorneys and financial planners to serve as your guide, to assist you and serve as an advocate in your quest to do what’s best for your loved one.