Medicare vs. Medicaid

The cost of senior care can stretch family budgets to the breaking point, but financial help is available. Medicare, Medicaid and the U.S. Department of Veteran Affairs offer assistance programs that can help pay for eldercare in certain circumstances.

Medicare

Medicare is a national, government-funded health insurance that all Americans receive when they turn 65. Disabled people who are under 65 can also enroll in Medicare without paying premiums, but for those looking for a solution to long-term care needs, Medicare alone may not be the best option. Talking to a knowledgeable, specialized agent can be a helpful way to ensure the best selection at the best price.

Medicare Covers Only Short-Term Care

Medicare can cover short-term rehab stays at a nursing home after a hospitalization and pay for rehab and in-home therapy for a limited period of time when prescribed by a doctor. The amount you pay for hospital services such as laboratory tests, medications and x-rays, varies depending on whether you receive inpatient or outpatient care. Understanding the difference between these two can help you manage cost expectations.

Medicare does not pay for the following types of senior care:

• Assisted living
• Long-term care at a nursing home
• Residential care homes
• Any long-term care

For more information about Medicare, see: medicare.gov

Medicaid

Medicaid is the leading government-assistance program for long-term care, which is administered cooperatively by the federal government and states. While the majority of its funding comes from the federal government, each state has some discretion in its individual rules, regulations and requirements.

Eligibility for Medicaid

1. Allocation of almost all existing assets goes toward care.
2. Low-income earners or people with medical-related care expenses that exceed their income.
3. Must reside in the state where receiving benefits.
4. Permanent resident or U.S. citizenship.

Note: If married, a couple does not need to have exhausted all financial resources. The healthy spouse can usually keep the home but may still have to make significant sacrifices.

Medicaid is the Social Safety Net for Ailing Elders

Medicaid is the safety net for Americans who need care that they cannot afford privately. Like Medicare, Medicaid acts as health insurance but it covers almost every type of healthcare cost. It can also be used to pay for long-term nursing home care. Many states allow its residents to use Medicaid to cover assisted-living communities or other alternatives such as in-home care.

Some states offer a program through Medicaid called PACE (Program of All-Inclusive Care for the Elderly). PACE covers all of the senior’s care and medical needs through one contracting agency, which allows people who have traditionally gone to nursing homes to stay at home with support.

State Medicare & Medicaid Guidelines

Each state has its own guidelines, so you will need to contact a State Medical Assistance office for more details:

• Call 1-800-MEDICARE: medicare.gov
• Visit the Medicare and Medicaid Services website: cms.hhs.gov

You may also want to speak with an elder law attorney who can help guide you through the nuances of a successful Medicaid application.

Veterans Aid

Veterans who are at least 65 years old and served during wartime (not necessarily in combat) may be eligible for financial assistance through the U.S. Department of Veteran Affairs (VA). Spouses, surviving spouses and other dependents may be eligible for assistance as well.

There are three levels of VA benefits for wartime veterans and their dependents:

1. Basic Pension: is designed to function as cash assistance for low-income veterans and their dependents. Applicants may be healthy.
2. Housebound Benefit: Housebound assistance with day-to-day activities must be needed on a regular basis.
3. Aid & Attendance: Assistance must be required on a daily basis.

Assistance from the VA is means-tested and will be allocated to people who are genuinely in need — meaning benefit is based on applicant’s assets, income and needs. Applicants whose countable income is over maximum thresholds (excluding home and car) will usually be denied, but decisions are largely made on a case-by-case basis. Those in borderline situations should still apply.

How to Apply for VA Benefits

Like Medicaid, VA benefits can be extraordinarily complex and should be dealt with by a Veteran Services Officer. Veteran Services Officers volunteer through the United States, frequently at hubs for veterans like American Legion Halls and Veteran of Foreign Wars (VFW) lodges.

To apply for VA health care or to determine eligibility:

• Call (877) 222-VETS: Health Benefits Service Center.
• Contact your local Veterans Benefits Office or Medical Facility.
• Visit the Department of Veterans Affairs website.

Non-Government Options for Financing Senior Care

Medicare, Medicaid and VA benefits are government programs that help pay for senior care in the United States — but there are alternatives. The easiest way to take control over your senior care expenses is to contact a licensed agent and discuss your health care options.