If Medicare insurance runs out or is not sufficient to meet the medical or daily care needs of an individual, Medicaid may be available. Medicaid is a Federal Government program now administered by states but funded by both Federal and state support. Like most government-oriented programs, the bureaucratic process of application and approval is daunting and complex. It is not recommended that an individual undertake this process on their own.
Qualification for Institutional Medicaid has several criteria. Here are the basics:
1 – Age: 65 years old or disabled;
2 – Level of Care: require assistance with one or more “Activities of Daily Living”;
3 – Income: Applicant’s gross monthly income cannot exceed $2,199 per month. You can use a “Medicaid Miller Trust” and/or a spousal allocation to get down to the maximum;
4 – Resources: With the exception of household goods, a $1,500 burial fund, a plot/casket/marker, one car, and one personal residence, an applicant may not have resources that exceed $2,000.
“Resources” is the category that needs the most planning and strategy in order to meet qualifications. Real property that has been occupied as a principle residence may be excluded. Medicaid also has a “look back” period of five years that can be used to disqualify applicants who have transferred assets for less than fair market value (gifts). All “exemptions” should be optimized before an application is submitted.
These qualifications are subject to various exceptions depending on marriage and the disposition of the other spouse. The key is to plan before application.