The terms Medicaid and Medicare sound almost interchangeable, yet these two healthcare assistance programs differ greatly.
As one of the most frequently asked questions by callers who reach out to the intake department at Senior Planning Services, we’ve found that many people don’t know which program is right for them: Medicare, Medicaid or both?
Last week, one of our intake representatives received a call from Bob. He was calling about his mother Joanne who had been in the hospital for a hip replacement and was moving into a rehab facility. Her funds were dwindling and he was concerned that she would not have the resources to cover her stay. Joanne was already enrolled in Medicare, but the nursing home had advised her that it may not cover her entire stay. With only $10,000 left in funds for Joanne, Bob was afraid that he would be left to foot the bill.
Here’s where Medicaid usually plays in. Our intake team worked with Bob to determine his mom’s Medicaid eligibility which would help him with the financial burden of Joanne’s care.
So, how do Medicare and Medicaid work when covering healthcare?
According to CMS (Center for Medicare and Medicaid Services) 75 million people enroll in Medicare or Medicaid a year. Medicare and Medicaid are both government programs available to the aged, blind or disabled; however, there are differences in eligibility criteria and covered services.
The following should not be looked at as legal or financial advice.
Medicare/ Medicaid Qualifications:
• Most people who are aged (over 65), blind or disabled will qualify for Medicare.
• You must be a citizen or permanent legal resident living in the U.S for five years.
• Medicare eligibility is not dependent on your income but you may not be eligible if you or your spouse didn’t pay taxes for at least ten years. These qualifications apply to Medicaid as well.
• However, in order to qualify for Medicaid one has to meet additional detailed and complicated income and asset requirements (see our Asset Allowances Tool).
Medicare/ Medicaid Coverage:
Medicare covers physician’s visits, hospitalizations, medical equipment (DME) and short term-rehab. Inpatient rehab is covered at a maximum of 100 days for every benefit period, as long as you have been in a hospital for at least three days prior. A benefit period starts when you admit to a hospital and ends when you have not received any hospital or skilled nursing care for 60 days. More information can be found on the CMS website.
Medicare will cover the first 20 days of your skilled nursing stay in full. It will cover up to the next 80 days with a copay of $198 per day (going up to $203 in 2021). If you are recovering and your nursing and therapy levels don’t indicate the need for a skilled level of care Medicare may cut your coverage before the 100 days. If you are not ready to discharge and don’t have Medicaid the nursing facility will begin billing you at an estimate of $300 per day (this varies by facility).
The Medicare copays plus any additional private days can accumulate into a hefty bill really fast. It is therefore crucial to look into Medicaid options as soon as you or a loved one admits to a hospital even if there is no plan for a long-term nursing home admission.
Medicare/ Medicaid Applications:
You can apply for Medicare by visiting your local Social Security office or calling Social Security at 800-772-1213. More information can be found on the Social Security website.
Applying for Medicaid is a lot more complicated than applying for Medicare. There is a lengthy, time consuming application process where you may have to submit a five-year history of financial documentation at the Board of Social Services in order to determine eligibility.
Senior Planning Services is a Medicaid application company that can assist you with all your questions during this overwhelming time of your life. We can handle all the details of your application, including gathering all the documents needed for the five-year lookback, leaving you with peace of mind and your approval in hand. Contact us at (732) 961-8430 or schedule a free consultation.