Planning for Long-Term Care: The Difference Between Medicare and Medicaid

Many people are confused about the difference between Medicare and Medicaid as it pertains to the challenge of paying for expensive long-term care. This is not surprising. The two programs sound similar and both provide for medical care. Let’s start with a brief definition of each program.

Medicare is an entitlement program. Everyone who reaches the age of 65 and is eligible to receive benefits from Social Security can also receive Medicare. Medicaid, on the other hand, is a public assistance program. It is designed to help people with limited income and assets pay for medical care. Recipients of Medicaid assistance must meet certain income and asset guidelines.

Now let’s look at how the two programs differ with regard to planning for long-term care.

Medicare vs. Medicaid for Long-Term Care

Medicare, by and large, does not cover long-term nursing home care. For example, Medicare Part A will only cover up to 100 days in a skilled nursing facility for a particular illness, and only after the patient has spent at least three days in a hospital. Worse, from day 21 to day 100, the individual in the skilled nursing facility must make a copayment of $170.50 per day. Few people actually receive Medicare coverage for the full 100 days, in part because of the copay, and in part because restrictions and conditions for coverage are quite stringent.

Medicaid, on the other, does cover long-term nursing home care for people who meet its income and asset limits. 100 days, one year, five years—Medicaid will pay for the care as long as the recipient is eligible. Given the high cost of nursing home care, the dearth of affordable alternatives, and the restrictions inherent in Medicare coverage, Medicaid is now the single largest payer of nursing home stays in the United States.

The Final Word on Nursing Home Care Coverage

So, can you get assistance from Medicaid to pay for nursing home care in Maryland? If your income and assets are less than the state’s guidelines, you are already eligible. If your income and assets exceed Maryland limits, you have to take the appropriate steps to become eligible.

The bottom line is this: While Medicare can help pay for a short-term stay in a nursing home, Medicaid can pay for long-term care. Through proper planning, you can obtain assistance from Medicaid to pay for nursing home care—and protect your hard-earned assets in the process. The sooner you start planning, the better your chances of getting the care you need while protecting most, if not all, of your assets.

Get Qualified Help Planning for Long-Term Care

Planning for long-term care can seem overwhelming when looking at the big picture. However, with the help of a seasoned estate planning lawyer, you can rest your concerns while putting the necessary infrastructure in place for a stress-free future.

Clifford M. Cohen is a passionate estate planning lawyer serving the DC and Maryland area. With over 35 years of experience, Mr. Cohen is well-versed in helping individuals plan for long-term care and maintain healthcare benefit eligibility. Contact us today at 202-895-2799 for a free case evaluation and discover the options available to you.