Understanding Medicare and Medicaid

Medicare Primer

Medicare is a federal program primarily for individuals 65 and older. It generally covers short-term care, rehabilitative stays, and acute medical needs, but it does not cover long-term custodial care like permanent nursing home residency.

Medicaid Basics

Medicaid is a joint federal and state program that provides health coverage to eligible low-income individuals. Crucially, Medicaid is the primary public funding source for long-term nursing home care, but the rules differ significantly from state to state.

Eligibility Requirements for Medicaid

Navigating the eligibility requirements for Medicaid requires satisfying both medical necessity criteria and strict financial caps. Both income and total assets are heavily scrutinized to ensure that only those who genuinely lack the means to pay privately receive the benefits.

The Look-Back Period

In most states, there is a 5-year 'look-back' period when applying for Medicaid. This means the government will examine all asset transfers and gifts made in the last 60 months to prevent applicants from simply giving away their money to qualify for aid.

Spousal Impoverishment Protections

When one spouse needs nursing home care and the other remains at home, Medicaid has built-in protections ensuring the healthy spouse retains a certain amount of income and shared assets, preventing them from living in poverty to fund the care.