Medicaid is a healthcare program that caters to people of all ages with low incomes. It is funded by the state and federal governments, covering various medical treatments like physician visits and non-medical support services such as in-home personal care, and nursing home care. If eligible, seniors’ long-term care costs may be wholly covered by Medicaid.
Although Medicaid must follow federal regulations, each state manages its program independently, leading to varying coverage and expenses based on their specific demands and economic objectives. This results in states having different programs aimed at diverse groups of people.
How Medicaid Works?
Medicaid is designed for people who lack sufficient resources and/or require substantial medical care, so in most cases, there are no premiums or deductibles. However, some states impose share-of-cost requirements based on income. Once enrolled, you will have access to primary and emergency medical care, as well as long-term services and support. Medicaid is administered by the government in some states, while private insurers manage care organizations in others, utilizing Health Maintenance Organization (HMO) or Preferred Provider Organization (PPO) networks.
One of the benefits of Medicaid is that it may cover Medicare co-pays or coinsurance, as well as expenses that your primary insurance does not cover if you are a dual enrollee. For example, Medicaid can help pay for medical expenses that Medicare enrollees with limited income are unable to afford. Additionally, Medicaid covers certain services that are not covered by Medicare, such as Skilled Nursing Home payments beyond the 100-day limit. However, these services are subject to Medicare eligibility criteria and will only be covered by Medicaid if Medicare benefits do not apply.
Medicaid Coverage Benefits
Medicaid provides coverage for mandatory medical services as well as supplementary benefits that differ from state to state. Both options offer low-income families an affordable way to receive necessary medical care.
The mandatory Medicaid benefits are similar to Original Medicare Parts A and B and include hospital care, skilled nursing, in-home care, preventive care, wellness screenings, doctor’s visits, diagnostics, transportation to medical care, EPSDT (Early and Periodic Screening, Diagnostic, and Treatment Services), and mental health personal care services.
In addition, there are optional Medicaid benefits that vary by state, such as prescription drugs, clinic services, physical therapy, occupational therapy, speech, hearing, and language disorder services, respiratory care long-term services, other diagnostic, screening, preventive, and rehabilitative services, podiatry services, optometry services, dental plans, and hospice care.
What Medicaid Doesn’t Cover?
While Medicaid may cover certain services not covered by Medicare, there are still limitations to its coverage. For instance, Medicaid generally does not cover medical care received outside of the United States, except in specific travel-related circumstances or when a foreign hospital is closer than domestic alternatives. Additionally, Medicaid does not provide coverage for the following:
- Replacement of medical equipment through warranty
- Healthcare services provided by other government agencies
- Provision of free healthcare screening devices
- Cosmetic surgery
- Personal items
Most items not covered by Medicaid fall into one of three categories: medically unnecessary and unreasonable services, improper bundling of charges, and reimbursement from another program.
How do I know That I’m Eligible for Medicaid?
Based on your income and family size, you may be eligible for free or low-cost healthcare coverage through Medicaid. However, eligibility requirements can vary among states.
Medicaid provides healthcare coverage to certain individuals and families, such as children, parents, pregnant individuals, elderly individuals with specific incomes, and individuals with disabilities, in all states.
To be eligible for Medicaid benefits, seniors must meet both financial and non-financial requirements. Each state has its own set of regulations, with different criteria for Medicaid programs or waivers and age groups. However, there are general guidelines that apply to most seniors.
Financial eligibility is determined by income and assets, which are evaluated differently by each state. For institutional Medicaid, most states have a Special Income Level criterion, which allows individuals to earn up to 300 percent of the SSI Federal Benefit Rate. The income limit for 2023 is $2742. For married couples with both spouses as applicants, each spouse is allowed up to $2,742 / month or a combined income of $5,484 / month. The countable asset limit for a single senior is $2,000 in most states, while for a married couple, it is generally $4,000. However, there are many exceptions, and some assets, such as the primary residence, automobile, jewelry, clothing, and furniture, are excluded. If a senior’s financial assets surpass the Medicaid eligibility limit but their income does not meet long-term care costs, they may “spend down” their assets on long-term care bills until they are eligible.
Non-financial eligibility includes being a US citizen or lawful permanent resident, applying in their primary states of residency, and completing a functional needs evaluation as part of the application process. Applicants must require assistance with at least two activities of daily living to qualify for Institutional Medicaid or Medicaid waivers and need nursing home-level care to be eligible for the waivers. States may also consider the applicant’s medical history, as some diseases may require long-term care at a facility.
Senior’s Medicaid Programs
Medicaid programs for seniors can be complex and eligibility requirements vary among states. Here are three specific programs to be aware of:
- Institutional Medicaid: covers inpatient services such as hospital stays, skilled nursing facilities, intermediate care facilities for people with intellectual disabilities, and mental health facilities for individuals 65 and older.
- Medicaid waivers: also known as Home and Community-Based Services (HCBS) Waivers, expand Medicaid coverage to include long-term care services outside of nursing institutions. These services can be provided in a variety of settings such as home, assisted living, adult foster care, or adult day care facilities.
- Cash and Counseling: available in several states, provides beneficiaries with money to pay for personal care services and allows them to choose their own caregivers, including family members. This program is also referred to as consumer-directed care, participant-directed care, or self-directed care.
As waivers are optional for states and not entitlement programs, seniors may experience long waiting times for services. Additionally, eligibility requirements and benefits may differ across states.
Medicaid for Pregnant Women and Children
Pregnant women can receive free health coverage during pregnancy and for two months after birth through Medicaid for Pregnant Women or the CHIP Perinatal program. Medicaid is available to low-income pregnant women who are U.S. citizens or qualified non-citizens, while CHIP Perinatal covers those who do not have health insurance but are not eligible for Medicaid. Both programs cover prenatal care, labor and delivery, and other benefits for the baby after leaving the hospital. Eligibility is determined based on monthly family income, which must fall below certain thresholds for Medicaid or CHIP Perinatal coverage. However, what is the lowest monthly income criteria may differ from state to state. In the State of New Jersey, Medicaid may cover children under the age of 18 if their family’s income is at or below 350% of the Federal Poverty Level, which is $6,723 per month for a family of four. Parents may also be eligible if their earned income is at or below 133% of the Federal Poverty Level, which is $2,555 monthly for a family of four. To be eligible, applicants must be uninsured, citizens or legal immigrants with permanent residency status. Parents/guardians must have legal permanent residency for at least five years, although exceptions exist for qualified aliens such as refugees and asylees. The five-year rule does not apply to children or pregnant women.
How To Apply For Medicaid?
Applying for Medicaid as a senior can be done by visiting a local Medicaid office and filling out an application, or by applying online in many states. To apply online, first fill out the health insurance application through the Health Insurance Marketplace. If eligible, the Health Insurance Marketplace will transmit your information to your state agency, which will contact you about enrolling. Additionally, you can directly contact your state’s Medicaid agency. Children whose parents do not qualify for Medicaid can apply for the Children’s Health Insurance Program (CHIP). The processing time for Medicaid applications is typically 45 days, or 90 days if a disability assessment is required, but additional time should be added for gathering the necessary paperwork.
Thomas M. Brzezinski is one of the founding partners of WMAG William & Michael Advisor Group LLC and Jersey Insurance Solutions. He has been involved in the insurance industry for over ten years and specializes in developing client relationships that last a lifetime.
