Most people pay into Medicaid and Medicare with each paycheck they earn. Both are government programs, but there are differences with each. Some older adults will never qualify for Medicaid benefits. Learn more about the differences and what it takes to qualify for Medicaid.
Medicare Is Available to Anyone Who is Disabled or Turned 65
When you turn 65 or are diagnosed with a disability, Medicare benefits become available. It’s a health insurance program that helps you pay for doctor’s visits, hospitalizations, and prescriptions. You sign up and pay a monthly premium that is often lower than traditional health insurance.
Medicaid is different. It’s only available for people of all ages who do not exceed certain income levels. Medicaid is covered by the government, though you may have to give up your retirement income and only be left with a monthly stipend.
Medicaid Income Levels Depend on State Rules
Each state sets its own Medicaid guidelines. In Alabama, income isn’t always the only consideration. The assets you own also count. If your parents have a home worth $200,000, Medicaid considers that as available finances.
Typically, a person has to have no more than $2,000 on the first of the month. This counts all real estate, life insurance policies over $5,000, CDs, annuities, promissory notes, bank accounts, etc. in order to qualify.
Too Much Income on the First of the Month Does Impact Whether You Qualify
When your parents qualify for Medicaid, they need to pay bills by the first of the month. If they get their Social Security and retirement/pension payments, they probably have more than $2,000. If that money is still in the accounts on the first, it can lead to a denial of benefits for that month.
Paying bills before the first is important to ensure they continue to qualify and don’t miss out on benefits each month. If they have caregiver services or live in an assisted living community that doesn’t bill until the first of the month, pay it early to ensure payment clears in time.
There’s a Five-Year Look Back
When your parents apply for Medicaid, the government looks at assets that have been sold or money that’s been given as gifts. If your mom sold her car to her grandchild for half the Blue Book value, it may be considered a gift. Giving away money to quickly lower assets is frowned upon and can delay how quickly your parents qualify for Medicaid.
It’s Worth Hiring an Elder Law Attorney to Help Out
As the rules for Medicaid are complex, it’s advised to hire an attorney who specializes in Medicaid applications. It eases stress and helps your family fully understand when it’s the right time to apply for Medicaid benefits to help with senior care services. It also helps protect the property your parents plan to leave to their heirs.
If you or a loved need assistance with Elder Law in Pell City, AL contact Nolan Elder Law & Estate Planning today. (205) 390-0101