Medicare vs. Medicaid
Medicare is a social insurance program that has been administered by the federal government since 1966 and currently is using about 30 private insurance companies across the United States.
This insurance is for individuals who are 65 and older who have paid into the system as well as certain young people with disabilities or people with end-stage renal failure requiring dialysis or a transplant.
Medicare covers up to 100 days at a skilled nursing facility if a 3-day hospital stay requirement has been met and a doctor orders that “skilled services”, such as skilled nursing care, physical or occupational therapy, or speech or language therapy, are required;
Medicare provides a home care benefit if ordered by a physician; and
Medicare covers the first 20 days in full and days 21-100 all less the daily co-pay amount.
Medicare supplements can be purchased and may cover the deductible and co-pay requirements.
Medicaid was enacted in 1965, and its voluminous provisions are housed in Title XIX of the Social Security Act. The Medicaid program is a “need-based” federal program that is administered by the states, and this means that the rules can vary between states. The program is designed to pay the cost of long-term medical care once the individual meets the income and eligibility requirements. To qualify, you need to be both financially eligible and medically needy.
You must be a resident of the state of Florida, a U.S. national, citizen, permanent resident, or legal alien, in need of health care/insurance assistance, whose financial situation would be characterized as low income or very low income.
You must also be either:
a parent or relative caretaker of a dependent child(ren) under age 19,
have a disability or a family member in your household with a disability, or
be 65 years of age or older.
Asset Test: Couples are allowed to keep $3,000 in assets. If there is one spouse that needs care, and one that does not, the spouse that does not receive care is referred to as the Community Spouse. The Community Spouse is allowed to keep up to $120,900 in countable assets.
Exempt assets do not count towards the asset test limits. The following are exempt:
One car of any value (a second car if it is over 7 years old but less than 25 years old and not a luxury car)
Income producing property
Burial plots for you and your spouse ($2,500 each)
Irrevocable Burial Contracts
Household and personal belongings
Life insurance if the face value is less than $2,500
The principal in certain annuities and IRAs or other qualified plans
The maximum amount of home equity allowed when applying to Medicaid is $560,000.
Income Test: Gross monthly income cannot exceed $2,205. (If income exceeds this level, you may still be able to qualify by establishing and funding an Irrevocable Qualified Income Trust ("QIT" or "Miller" trust).
The maximum amount a community spouse can receive monthly is $3,023 and the minimum amount is $2,003.
All of an individual's income must go towards their cost of care, aside from $105 which is allowed for a personal needs allowance.
Individuals cannot give gifts of any amount for a period of 5 years prior to applying for Medicaid. If a gift of any amount is given in Florida during a period of 5 years before applying to Medicaid, a penalty period will be initiated. Medicaid will not pay for care until the penalty period is over. The penalty is calculated by taking the amount of any gifts given and dividing it by $8,662, which creates a number of months before Medicaid kicks in.