How Regular Medicaid for Seniors Compares to Nursing Home Medicaid

 

 

Introduction
Medicaid is known for providing long-term care in nursing homes, but not many people know about the long-term care benefits covered via state, or regular, Medicaid. These benefits differ from those provided in nursing homes, and the financial and medical eligibility criteria for the two programs are also different. Some of the rules governing assets, income and home ownership also vary. Understanding these differences can help seniors get the long-term care they need, when they need it.

 What’s in a Name? In this article, we refer to non-Nursing Home Medicaid as regular Medicaid for seniors. However, it is often called Aged, Blind and Disabled (ABD) Medicaid, Elderly & Disabled (E&D) Medicaid or state Medicaid. Many states also have their own unique name for their regular Medicaid programs.

 

Comparing Medicaid’s Long-Term Care Benefits

The clear distinction between Medicaid’s nursing home benefits and the long-term care benefits covered by regular Medicaid for seniors is the location where they’re provided. Regular Medicaid for seniors covers care in the community, which can mean the beneficiary’s home or the home of a loved one. Some regular Medicaid programs will also cover long-term care in assisted living facilities, adult foster care, adult day care, group homes and memory care units for Alzheimer’s disease and other dementias, depending on the state. Nursing home coverage is confined to nursing homes.

There are many other differences between Medicaid’s benefits in nursing homes and the long-term care it provides via regular Medicaid, including what and how much is actually covered.

 

Regular Medicaid for Seniors Long-Term Care Benefits

While Nursing Home Medicaid beneficiaries can receive all of their long-term care benefits as soon as they qualify, regular Medicaid beneficiaries qualify for their long-term care benefits on an as-needed basis. Essentially, they have to show a medical need for the long-term care benefit in order to qualify for it. That can happen when they first apply for Medicaid, or after they apply if their health condition worsens and they have new care needs.

The long-term care benefits available through regular Medicaid for seniors can vary significantly depending on the state. Availability can even vary within a state due to a lack of care providers or resources in certain areas. With that in mind, here’s a list of long-term care services and supports that can be covered by regular Medicaid.

• Assistive technology and products – This can be any device that helps beneficiaries age in the community, from over-sized clocks to wheelchairs.
• Case management – Help with managing benefits, appointments and caregivers.
• Chore services – Help with household chores that can range from changing batteries in a remote to shoveling snow.
• Companion services
• Durable medical equipment – This includes items like oxygen tanks, diabetes test kits and adult diapers.
• Financial management services
• Homemaker services – This can include cleaning, shopping and cooking.
• Home modifications for safety and accessibility – Labor and materials can be covered for updating a home with things like grab bars, wheelchair ramps and widened doorways.
• In-home nursing services
• Meal delivery
• Persona care assistance with the Activities of Daily Living (mobility, bathing, dressing, eating, toileting)
• Personal Emergency Response Systems
• Respite care for family caregivers
• Transportation (medical and non-medical)

Some regular Medicaid programs also offer Consumer Directed Care. This allows the beneficiary to hire and pay care providers of their choice for certain benefits, like personal care assistance or homemaker services. These care providers can include relatives, like adult children who might already be providing care for free, and in some cases they can even be spouses.

As mentioned above, regular Medicaid will provide these long-term care services and supports in the beneficiary’s home or the home of a loved one, and some regular Medicaid programs for seniors will provide long-term care in assisted living facilities, adult foster care, adult day care, group homes and memory care units for Alzheimer’s disease. However, it will not cover room and board in any of these locations, which is a significant difference between Medicaid’s regular and nursing home coverage.

Like Medicaid’s nursing home coverage, regular Medicaid is an entitlement, which means qualified applicants are guaranteed to receive benefits. This always applies to basic healthcare coverage like physician visits, medications, short hospital stays and any medically necessary procedures, but seniors could potentially run into a wait for some long-term care benefits. That’s because the state agency or caregiver providing services in their area might have a waitlist due to a lack of staff or other resources.

 

Medicaid Long-Term Care Benefits in Nursing Homes and with HCBS Waivers

Medicaid covers all of the essential costs of nursing homes. This includes physician visits, nursing care, medication, hygienic items (toothbrush, soap, etc.), emergency dental services, mental health services (if necessary) and some social activities, as well as room and board expenses. What Medicaid won’t cover in nursing homes is a private room (unless medically necessary), specialty foods, phone, television, cosmetics, clothes, flowers and any care services not considered medically necessary.

Medicaid’s nursing home coverage is an entitlement, which means all eligible applicants are guaranteed to receive coverage without wait. However, not all nursing homes accept Medicaid and those that do accept it don’t always have an available bed, so Nursing Home Medicaid beneficiaries are not covered in every facility, and they may face waitlists at some facilities.

It’s important to note that seniors with Medicaid’s nursing home coverage are required to give most of their income to the state to help cover the cost of care. They are only allowed to keep a small personal needs allowance ($30-$200 depending on the state), as well as enough to make Medicare premium payments if they are dual eligible, and enough to make spousal allowance payments, if applicable.

Home and Community Based Services Waivers
Medicaid also covers long-term care benefits in the community with its Home and Community Based Services (HCBS) Waivers. States have their own unique Waivers, so available benefits can vary between states. In general, however, HCBS Waivers offer the same long-term care benefits as listed above for regular Medicaid for seniors. However, HCBS Waivers are not an entitlement. Instead, they have a limited number of enrollment spots, and once those spots are full additional applicants are placed on a waitlist.

There are also differences in the medical and financial eligibility criteria for state Medicaid, HCBS Waivers and Nursing Home Medicaid, which we will discuss next.

 

Differences in Financial Eligibility Criteria

All Medicaid programs are intended for people with limited financial means, so the financial eligibility criteria is relatively strict. However, the specific financial eligibility numbers can all vary depending on the state, the applicant’s marital status and the Medicaid program. There are also some significant financial restrictions, and allowances, that don’t apply to regular Medicaid for seniors.

Asset Limits and Spousal Asset Allocations

The individual asset limit in most states in 2024 for regular Medicaid for seniors, Nursing Home Medicaid and HCBS Waivers is $2,000, but there are exceptions. For example, the individual asset limit for all three programs in New York is $31,175, while in neighboring Connecticut it’s $1,600, and in Florida it’s $2,000 for Nursing Home Medicaid and HCBS Waivers, but it’s $5,000 for regular Medicaid.

For married couples with both spouses applying for Medicaid, the asset limit in most states in 2024 is a combined $3,000. Again, there are exceptions, like Illinois, where the asset limit for a married couple with both spouses applying is $17,500 for all three programs, or in California, where there is no asset limit for any applicant regardless of marital status or program.

There are major differences in asset limits for married applicants with only one spouse applying. For Nursing Home Medicaid and HCBS Waivers applicants, the asset limit for the applicant spouse is $2,000 in most state in 2024, while the asset limit for the non-applicant spouse is $154,140, depending on the state and the couple’s financial situation. That’s due to the Community Spouse Resource Allowance (CSRA).

The CSRA does not apply to regular Medicaid for seniors. Instead, the asset limit for married regular Medicaid applicants is a combined $3,000 in most states in 2024 whether it’s one or both spouses applying.

 

Income Limits and Spousal Income Allowances

The individual income limit for regular Medicaid programs in 2024 ranges from $943/month to $1,751/month, depending on the state. The individual income limit for Nursing Home Medicaid and HCBS Waivers in most states in 2024 is $2,829/month, but there are exceptions, like North Carolina, where the regular Medicaid and HCBS Waivers income limit is $1,255/month, while the Nursing Home Medicaid income limit is the average monthly cost of nursing home care in the beneficiary’s area. Remember, Nursing Home Medicaid beneficiaries must give most of their income to the state to help cover the cost of care.

For married applicants with both spouses applying for regular Medicaid, the income limit in 2024 ranges from $1,415/month to $2,593/month, depending on the state. For married applicants with both spouses applying for Nursing Home Medicaid or HCBS Waivers, the income limit is either a combined $5,658/month or $2,829/month per spouse in most states in 2024.

As with asset limits, the chief differences in income limits arise when only spouse in a married couple is applying. For regular Medicaid, the income of both spouses is counted toward the income limit whether one or both spouses is applying, so the income limit for married couples with only one spouse applying for regular Medicaid in 2024 ranges from $1,415/month to $2,593/month, just like it does for a married couple with both spouses applying for regular Medicaid. On the other hand, Nursing Home Medicaid and HCBS Waivers do not count the income of the non-applicant spouse. What’s more, the applicant spouse can go over their normal income limit if the non-applicant spouse has limited income in order to transfer some of that income to the low-income, non-applicant spouse. This is called a Monthly Maintenance Needs Allowance (MMNA). The applicant or beneficiary spouse can then transfer their extra income to their non-applicant or non-beneficiary spouse until they reach their MMNA limit, which can be up to $3,853.50/month depending on the state and the couple’s financial situation.

The MMNA does not apply to regular Medicaid for seniors.

 Spousal Treatment: The Community Spouse Resource Allowance and the Monthly Maintenance Needs Allowance are ways for Nursing Home Medicaid and HCBS Waivers applicants and beneficiaries to exceed their financial eligibility limits, but neither apply to regular Medicaid for seniors.

 

Home Ownership’s Impact on Eligibility

If the home was counted toward Medicaid’s asset limit, almost all homeowners would be ineligible. However, the home is exempt from the asset limit in many cases. All of the following contingencies apply to regular Medicaid, Nursing Home Medicaid and HCBS Waivers, but there is one major difference: The home equity interest limit does not apply to regular Medicaid for seniors.

• If the applicant lives in the home and their home equity interest is below the state limit then the home is exempt. Home equity interest is the portion of the home’s equity value owned by the applicant minus any outstanding debt, like a mortgage. The home equity interest limit in most states in 2024 is $713,000 or $1,071,000, but remember, state Medicaid applicants can disregard the home equity interest limit. Their home’s value and how much of it they own does not matter – if they live in the home, it is exempt.
• If the applicant’s spouse, minor child or disabled child of any age lives in the home, it is exempt, regardless of the applicant’s home equity interest, where they live or what program they are applying for.
• If none of those people live in the home, it can still be exempt if the applicant/beneficiary files an “intent to return” home statement and, if they are applying for Nursing Home Medicaid or HCBS Waivers, they also meet their home equity interest limit.

 

Look-Back Period Differences

Medicaid applicants are not allowed to simply give away their assets in order to meet their asset limit. To ensure they don’t, Medicaid uses the Look-Back Period. In most states, the Look-Back Period is 60 months (five years). This means the state will look back into the applicant’s financial history for the 60 months prior to their application date to make sure they have not given away any assets or sold them at less than fair market value. If they have, their application will be denied and they will face a penalty period of ineligibility that could last months or even years, depending on the value of the violating assets and the state.

The Look-Back Period does not apply to regular Medicaid for seniors. It only applies to seniors applying for nursing home coverage or HCBS Waivers. Regular Medicaid applicants should still be cautious about violating the Look-Back Period because they may eventually need Medicaid’s nursing home coverage, or an HCBS Waiver, and then they will be subject to the Look-Back Period.

 

Differences In Medical Eligibility Criteria

To qualify for Medicaid’s nursing home coverage or HCBS Waivers, applicants in all states must require a Nursing Facility Level of Care (NFLOC). But that’s not the case with regular Medicaid for seniors. In fact, there is no medical requirement to receive general healthcare coverage via regular Medicaid. To receive long-term care benefits via regular Medicaid, applicants must show a need for that particular benefit instead of needing a NFLOC.

The exact definition of NFLOC and how it’s evaluated depends on the state. All states take into account an applicant’s ability to complete the Activities of Daily Living (mobility, bathing, dressing, eating, toileting), but how they take them into account can vary. In some states, needing help with three of the five Activities of Daily Living may be the definition of a NFLOC, in other states it might only be needing help with two of the five. States also use their own tests and protocols to determine an applicant’s medical condition.

For example, a senior who is physically healthy but showing signs of early onset dementia may not need a NFLOC in the eyes of the state. But they might be medically eligible for long-term care benefits through state Medicaid such as case management, medication management, transportation or even adult day care.

 

Comparing the Application Processes

Seniors and their representatives should do some careful research before applying to any Medicaid program, but what they research depends on the coverage they need. If the senior needs to live in a nursing home, they will have to look into nursing homes in their area to see which ones take Medicaid and seem like a good fit. If they don’t require a Nursing Facility Level of Care (NFLOC) but need some long-term care, they will need to research what kind of long-term care benefits might be available through the regular Medicaid program and if they might qualify for them.

All seniors considering Medicaid will also need to evaluate their own finances and the financial eligibility requirements for Medicaid in their state. Those requirements vary by program, as discussed above. This evaluation should also include gathering financial documents, because all Medicaid applicants must supply documents that clearly illustrate their financial situation and prove they meet the requirements.

Determining what documents are needed and acquiring them can be the most time-consuming part of the application process. That’s especially true for seniors applying for Medicaid’s nursing home coverage or HCBS Waivers because they must supply five years worth of documents due to the Look-Back Period, as discussed above. Regular Medicaid applicants only need to supply documents that illustrate their current financial situation because the Look-Back Period does not apply to them. This means, at least in theory, that the determination process for regular Medicaid applications will be faster than it is for nursing home coverage or HCBS Waivers because there are fewer documents to evaluate. But regular Medicaid beneficiaries may have to wait longer when it comes to being approved for long-term care benefits since they have to be approved for one at a time.