What is Medicaid and what does it cover?

Medicaid is an assistance program for certain health care needs that is primarily administered by the individual states. It is different than Medicare, although some people have both. Medicaid covers certain services that Medicare does Not, such as long-term care in a nursing home and also some medically necessary dental care. Medicaid typically does not automatically cover prescription drugs, which are instead covered by Medicare’s “Part D” benefit. Medicaid eligibility is based on a person’s income and assets, and serves people of every age. Medicaid enrollees typically do not pay any costs for covered medical expenses, but in other instances, a premium and/or co-pay is necessary depending on the state you live in. In 2012, 72.6 million people were receiving Medicaid benefits and according to the Center for Medicare and Medicaid Services, Medicaid will pay for 20 percent of all health care expenditures by 2020.

While Medicaid covers many needs, eligibility is based on several, strict factors. There will be a careful review of a person’s income and assets, and whether assets have been transferred over a period of several years. Proper estate planning well ahead of time can allow for a parent or loved one to be eligible for Medicaid when the time comes for them to receive care, including when they need to enter a nursing home. A study released in April 2013 by Genworth Financial found that the median annual cost of private nursing home care is $83,950, a 24% increase in just five years. Few people can afford this cost out of pocket. That is why proper planning is crucial for ensuring a loved one receives quality care while not draining their hard-earned savings and assets. An elder law attorney is best able to discuss a person’s long-term care needs, whether Medicaid is the proper option, and the steps needed to qualify for such benefits.