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MediCARE or MediCAID Who pays for what?

Posted Oct 28 2008 9:48pm

The following post is offered by Toby Mullenger,TobyFamily Advisor for A Place for Mom.  Toby has earned a place in my Golden Rolodex for senior professionals to whom  I refer my clients and their families.  Toby's an expert at helping elders and their families navigate the senior housing and health care maze.

Sidebar: Why is a REALTOR including a post about Medicaid and Medicare?   It’s all about ensuring elders have a good financial plan in place BEFORE we liquefy their assets in their home. It’s important to take into considerations such as current health care needs and financial assets.   When a senior makes a move from their home, it’s more than just the sale of a home.   We really need to develop a move plan that takes into consideration the seniors long-term goals.

Ever notice that little deduction on your paycheck for Medicare?  That’s because you are paying into a federal insurance program that is designed to pay for some of your primary medical costs once you turn 65 years of age. 

Medicaid, on the other hand, is administered by your State Government and is based on your needs, both financially and medically.  Though the laws differ somewhat from state-to-state, typically if you are 65 years old, have “spent down” most of your assets, and you require various types of medical attention (such as a hospital visit or nursing home admission) you would be eligible for Medicaid.  Many people will never be eligible for the Medicaid program because of the very low income guidelines established by each state. 

The primary confusion families have when searching for senior housing options is, “which one pays for what?”  Well, often times, neither pays for anything.  Medicare is not designed to pay for long-term care.  In a nursing home for instance, Medicare will only pay for up to100 days, and that is under very limited circumstances.  By contrast, Medicaid will pay for long-term care but only after you have spent most of your assets and you require a certain level of medical care.  While there are a few states that allow Medicaid to pay for assisted living, most do not.  Your local family advisor with A Place For Mom will be knowledgeable about the current laws and regulations that govern senior housing and healthcare in your area.

Don’t be too hard on yourself if you are not an expert on Medicare and/or Medicaid. Both programs can be very complex and confusing.  The following are some very general differences between the two:

MEDICAID

·          Individual must be over 65, disabled or blind.

·          Financial and medical based health program

·          Individual must meet financial and medical guidelines.

·          Individual state by state differences create a different program in each state.

·          Requires mandatory contribution of all beneficiaries’ income.

·          Pays for long term care.

MEDICARE

·    Generally individual must be over 65 to be eligible.

·    Federal insurance program for seniors.

·    Need to have contributed to Medicare system to be eligible.

·    Co-payment required by beneficiary.

·    Federally controlled, uniform application across the country.

·    Pays for primary hospital, homecare and related medical services deemed necessary. 

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