People have a number of misconceptions about the Medicaid program. Because you, or someone you love, may someday need benefits provided by the program it pays to clear up those misconceptions now.
Medicaid is a healthcare program that is predominantly funded by the federal government but is administered by the individual states. Medicaid should not be confused with Medicare. Medicare is also a federally funded healthcare program but Medicare is administered by the federal government, not by the states. Furthermore, Medicare is an entitlement program, meaning everyone who reaches the age 65 (and in some cases people under age 65) qualifies for Medicare benefits. Medicaid, on the other hand, is a means program that requires an applicant to prove eligibility. Proving eligibility in St Louis Missouri requires, among other things, a showing that the applicant’s income and resources are below the program limits. These limits are usually very low. The resource limit for some Medicaid programs, for example, is as low as $2,000.
Like many people you may be under the impression that you will never need Medicaid benefits because you have private health insurance and you know you will qualify for Medicare at some point in time. What you may not realize is that most private health insurance policies do not cover the cost of long-term care. Medicare does not cover these costs either. For this reason alone you may someday need to qualify for Medicaid in St Louis Missouri.
Long-term care costs can quickly deplete a life time of savings for the average person. In Missouri, a year’s stay in a long-term care facility will set you back, on average, about $75,000. The average stay in a long-term care facility is two and a half years. That’s almost $200,000 in costs that are not covered by Medicare or most private health insurance policies. This alone is what prompts many people to include Medicaid planning in their estate plan even if they have a good health insurance policy at the time they create their plan.
If you suddenly find that you need long-term care and apply for Medicaid at the last minute you may find that your resources disqualify you for immediate benefits. You will then be required to “spend-down” those resources before benefits are available. Transferring assets at the last minute isn’t an option either because Medicaid has a five year “look-back” period. Assets transferred during that period will likely be attributed to your resources at the time of application and cause you to incur a penalty, or waiting, period.
Now that you better understand the Medicaid program and why you might someday need to qualify you may wish to discuss including a Medicaid plan in your overall estate plan with your St Louis Missouri estate planning attorney.