Hassle-Free Health Coverage: What Services Are Covered Under Medicaid?
Medicaid offers a minimum set of services including hospital, physician and nursing home services. Additionally, state agencies have the option of covering an additional 31 services including prescription drugs, hospice care and personal care services.
Medicaid is the largest insurer of long-term care (LTC) in the United States -- covering the bulk of what most people would consider the middle class. It covers 68 percent of nursing home residents and over 50 percent of nursing home costs.
In 1995, Medicaid expenditures for healthcare amounted to $152 billion. States paid $66 billion
(43 percent) and the Feds paid $86 billion (57 percent).
Using up a lifetime of assets is a frightening scenario for an older person on his or her own. But what if your spouse is still living at home and you must move into a nursing home? Will you have to sell the house to cover you nursing home costs? Where will your spouse live?
At one time, Medicaid rules required you to liquidate virtually all of your assets -- including cash, investments, bank accounts and real estate -- to qualify for coverage. The federal government modified the requirements in 1993 to allow surviving spouses and disabled children to retain more of the family's assets.
Now, if you are married and you enter a nursing home while your spouse remains in your house, the at-home spouse is permitted to keep the following:
- one home;
- one care;
- the greater of one-half of the couple's assets or $75,740; and
- up to $1,919 in monthly income.
These amounts are indexed annually for inflation and are significantly lower for unmarried seniors. However, once neither spouse is living in or likely to return to the home and the house is sold, Medicaid may demand reimbursement for expenses associated with prior nursing home services.
An entire "Medicaid Planning" specialty has emerged to help people avoid running through their life savings before qualifying for Medicaid. Some people are tempted to give away assets so that they can qualify for Medicaid and still pass something along to their heirs. However, the government frowns on this: Federal provisions enacted in 1996 set criminal penalties for transferring assets for the sole purpose of qualifying for Medicaid.
