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What is the difference between Medicare and Medicaid?

Medicare and Medicaid are two entirely different programs. Medicare is the Government health insurance program for people over 65 and for those who are on Social Security disability. Medicare provides coverage for hospitalization, doctors and other types of medical expenses. Medicare is a medical insurance program, and except for a limited short-term nursing home benefit, does not provide coverage for nursing home or other long-term care.

In order to get Medicare coverage for a nursing home stay, you must be in an approved skilled nursing facility, have been in the hospital for at least three days prior to entering the facility, and to be deemed by Medicare to be medically benefiting from that skilled nursing (usually undergoing therapy). Custodial care is not covered. Technically, there is a maximum of 100 days of nursing home benefit. In actuality, the requirement about medically benefiting usually limits the benefit to a period of 10-20 days for rehabilitation. Under no conditions does Medicare pay for assisted living, residential care facilities, adult foster care or home care. And, except during the time you're in the hospital, Medicare does not cover medications. Medicare does have some benefit for home health but this is purely for medical reasons, not for caregivers to come in and attend to someone who needs help with personal needs on a long-term basis.

Medicaid, on the other hand, which is funded jointly by the Federal Government and the individual states, is the program that provides benefits for long-term nursing home care, and, in a number of states, benefits for other types of long-term care. return to top



What types of benefits will Medicaid provide?

That depends on the state. In all states Medicaid (called Medi-Cal in California) provides benefits for nursing home care, which typically includes room and board, care, prescriptions, supplies and medical coverage. In most states, other types of care, often referred to as 'community based care', such as assisted living facilities, residential care facilities, adult foster care facilities, home care and adult day care, may also be covered. Some states cover all these types of care; some cover one or two, and others only nursing home care. You will need to check with your local Medicaid office to find out which types of care are covered in your state, and if there are any special limitations or requirements for their community based care programs. return to top



If my loved one is on Medicaid, won't they get substandard care?

The quality of care is more a function of the specific facility, rather than the pay status of the patient. The truth of the matter is that the majority of long-term care patients are already on Medicaid. Sure, there are some 'high class' facilities that cater specifically to those clients for whom cost is not a consideration. However, most facilities will generally have a mixture of Medicaid and private pay patients. For the most part, the actual caregivers have no idea, nor do they care, which is which. Besides, every facility must abide by both state and Federal standards of care. It is against the law to provide substandard care. In addition, every state has an Ombudsman program available to patients and their families to investigate such problems. And, regardless of whether the patient is private pay or on Medicaid, the more involved the family, the better the care of the patient. return to top



If there were a way to protect assets from Medicaid, wouldn't my attorney tell me about it (which he has not)?

Attorneys, like many other professionals, tend to specialize. Most attorneys have little or no experience with Medicaid qualification. Very few have the knowledge or experience to put together an effective plan to maximize the protection of assets while preparing a patient for Medicaid qualification. return to top



Can't I find out from the Medicaid office how to protect assets?

Quite frankly, the state does not have an interest in helping you learn how to save assets while qualifying for Medicaid? The job of the Medicaid worker is to determine if you currently qualify for benefits. Besides, Medicaid workers are not trained, nor are they allowed, to give financial or legal advice. return to top



Will we have to sign over our house to the State to get help?

No. As long as either the patient or the spouse is living in the home, or is expected to return, the home is an exempt asset. After both spouses are dead, the State may have the right to make a claim for the benefits it has advanced, but (depending on the state) there are limits to which the state can invade the spouse’s estate. By taking the proper steps, the family may well be able to avoid any claim against the home, or any other portion of the estate. return to top



In determining eligibility, whose income is counted?

For eligibility purposes, only the patient's income is considered. The current Federal standard is $1,737 per month. However, not all states observe the cap, and of those states that do, if the patient's income exceeds the standard, an "Income Cap Trust" can be used to bring the income (for eligibility purposes) to within the limit. return to top



Will putting an offspring's name on an account (for example, joint savings account) protect it from Medicaid?

No. The account is still counted, no matter how long ago it was done. return to top



Will a revocable Living Trust protect assets from Medicaid?

No. Since the trust is revocable, as far as Medicaid is concerned the assets are still owned by the couple. return to top



Do we have to be broke to get Medicaid?

No. Technically, the patient has to be broke, but as a married couple, there are a number of strategies in the Medicaid procedures that can be used to protect the spouse financially. In many cases there may be a "spend down" requirement (technically, a "reduction of countable resources"), but even then, depending on the state, that can often be quickly accomplished, with the spouse retaining most or all of the value of the family assets and savings. return to top



Will the spouse be forced to contribute to the "cost of care" for the patient?

No. Generally speaking, the only income that can be utilized to help pay for care is the income of the patient, not the spouse. And, depending on the spouse's situation and income, some or all of the patient's income may be diverted to the support of the spouse. return to top



How do we determine if we could qualify, and the steps we need to take to protect our assets?

For couples who have assets to protect, and where one of them is in, or about to enter, a nursing home or other long-term care, the process of qualifying for Medicaid, while protecting those assets, can be fairly complex. The options available, and the effectiveness of those options, will vary significantly from state to state, and the applicability of these options will depend on the specifics of each couple's individual situation. Therefore, it is essential that you be working with a professional who is familiar with the Medicaid rules in your state. Usually the problem is finding that expert. As a result, we have identified a number of these experts across the country, and would be glad to refer you to one of these experts in your state. Call us at 866-334-2243 to discuss your situation – there is no charge. return to top



Is Medicaid planning legal?

Absolutely! What is important is to understand how to use the Federal and state Medicaid rules exactly as they are written. Protecting assets from Medicaid involves using the rules to your advantage, not trying to get around them. return to top



Who gets the saved assets?

In most cases, it is the spouse that ends up with the assets. However, often times actions taken to protect assets for the spouse can also result in the protection of those assets for the children. return to top



If Medicaid indicates that there is a 'spend down' to accomplish, aren't you required to spend that on care costs before qualifying?

No. Actually, the requirement is to 'reduce countable resources,' which can be done in a whole variety of ways, other than actually spending the money on care. Protecting assets while accomplishing the spend down will depend on the particular state and your specific circumstances. return to top

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