Part 3: Medicaid – What Is It?
In Part 2 we discussed how Veteran’s Benefits can provide additional income to cover long term care expenses. If you are not a Veteran or widow of a Veteran these benefits are not available to you. Even if you qualify for Veterans benefits your long term care costs can easily exceed these benefits. So luckily there is a backup plan available to all middle class seniors to pay for long term care expenses – Medicaid.
Medicaid is not Medicare
Healthcare risk is by far the greatest risk to your estate … bar none! Most people believe that when they turn 65 that they simply sign up for Medicare and they are protected from catastrophic health care events. Some folks go one step further and sign up for a Medicare Supplemental plan for prescription drugs etc. Essentially Medicare pays for your doctor and hospital bills.
But let me tell you Medicare does nothing to protect you from long term health care expenses. While Medicare does pay for some nursing home care it is limited to medically necessary skilled nursing and will only cover a period of up to 100 days. After that you are on your own.
What is Medicaid?
Medicaid pays for long term care expenses primarily for nursing home care. However, there are some exceptions where Medicaid will pay for home care or assisted living expenses. These exceptions are somewhat difficult to obtain.
The Big Medicaid Myth
Like most folklore and myths, someone, somehow, somewhere started a rumor that Medicaid is for poor broke people. Nothing could be further from the actual truth. As a matter of fact, over 50% percent of people in nursing homes are on Medicaid. Does that mean that 50% of people in a nursing home are poor? Hardly!
So in its purest form, Medicaid is the Long-Term Care avenue of payment for most people in middle-class America with assets ranging from $100,000 to $1 million.
However, for middle class seniors to qualify for Medicaid takes some advance thinking and planning. As you might imagine there are numerous rules and regulations as to how middle class seniors can qualify for Medicaid without having to spend down their life savings.
That’s where we can help. We walk you through the maze of regulations so that you can legally qualify for Medicaid without destroying your life savings or losing your house.
Advanced planning is particularly important for married couples because an expensive long term care event for one spouse can leave the healthy spouse in financial distress.
Let us know if you would like a review of your situation to see if you can plan ahead to protect your life savings from a health care disaster.