In our last post, we discussed how Medicare pays in skilled nursing facilities for “rehab” stays. To summarize, Medicare will pay for most of the costs of someone who has a 3 day hospital stay and then needs to go to skilled nursing for some type of therapy or other skilled need to fully recover. The thought process is basically that Medicare will pay to help someone get better. Once that person has either recovered, or it becomes apparent that continued therapy will not lead to that person’s recovery (because the person simply can not make any more medical recovery due to brain damage, for example), then Medicare stops payment. Medicare will also stop payment if the rehab stay lasts greater than 100 days for any one spell of illness. Rehab stays are all part of Medicare Part A. However, it is possible to get some things paid for in a skilled nursing facility to be covered under Medicare Part B, which is a totally separate set of benefits. An example of this could be the individual who is benefitting from physical therapy, but has completed the 100 day stay under Part A. Part B can still cover the costs of therapy, even past the 100 days. Even though the therapy is covered, there will still be charges for the room and board that the resident will be responsible to pay. If someone completes the rehab stay, then they will either become a private pay resident, or if they qualify, they can receive Medicaid benefits.
Almost daily, I will have clients mistakenly use the terms “Medicare” and “Medicaid” interchangeably. The truth is that these programs, other than both starting with M and dealing with health care, are completely different from each other. It is important to realize the differences between the programs, in order to fully understand the financial impact of needing care will have on a family and their finances.
You do not need to be eligible for Medicare to be eligible for Medicaid, or vice versa. In order to be eligible for Medicare, you must be either age 65, or declared disabled by Social Security for 2 years (there are few exceptions to the two year rule). You or your spouse must also have paid into Medicare for at least 40 quarters. Virtually everyone who is over age 65 is eligible for Medicare Part A, and almost all of those people also voluntarily have enrolled in Medicare Part B. In order to qualify for Medicaid (or MoHealthnet as it is officially called in Missouri), you must be age 65 or disabled (note that there is no 2 year wait). However, there is also an asset test that must be met for eligibility, which is different than Medicare. This asset test is usually having less than $1,000 of countable assets. I often tell my clients that Warren Buffett receives Medicare benefits, but he will never get Medicaid benefits (because he will always fail the asset test).
Medicare essentially acts like traditional health insurance in that it pays for hospitalizations, therapy, doctor’s visits, x-rays, etc. Medicaid can also pay for those things (but only if Medicare or private insurance doesn’t pay first). But Medicaid can also pay for things for which Medicare doesn’t pay. Probably the most commonly used example is payment for long term care after a rehab stay ends. But Medicaid can also possibly pay for in-home aides, transportation to/from doctor’s appointments, and several other areas. While Medicaid may pay for more services, it is also important to note that more doctors will accept Medicare payment, and accessing providers can sometimes be difficult with Medicaid.
Do you have questions about Medicare or Medicaid? For more information, please contact Mike at www.elderlawofstcharles.com or 636-946-7899. Mike Weeks from The Weeks Group, LLC, a St. Charles law firm that handles elder law and estate planning matters.