The Medicaid Program is authorized by Title XIX of the Social Security Act. Unlike Medicare, Medicaid is not health insurance. Instead, Medicaid is designed as a “safety net,” to catch people when they can no longer afford to pay for their own health care costs. As such, individuals and families often have to spend assets they planned to pass to their children, or others, on their health care needs instead.
Being able to account for the potential need for long term care does not mean “tricking the system.” It may include buying long term care insurance, joining a long term care partnership plan, investing in exempt resources, or other strategies. As with any other planning, more options may be available if a family is planning for a possible future need for care, instead of reacting to an emergency need that has already occurred.
The Medicaid system can be confusing. While it is a federal program, each State operates it differently. There are several types of Medicaid assistance, ranging from an “insurance card” while at home, to paying for long term care in a nursing facility. The rules for qualifying for Medicaid are different for a single person as compared to a married couple. Among married couples, there are different rules, depending on the type of care needed and the setting where one or both spouses live. It is not uncommon to receive “bits and pieces” of information about Medicaid from well-meaning individuals, which may or may not be completely correct. When those pieces are put together, a distorted picture may be the result.
In my practice, the goal of Medicaid planning is to use the resources available to best accomplish the family’s goals. The family has the ultimate decision of what planning is best for them.