Medicaid is a government run health insurance program. It is jointly administered by the federal government along with each respective state government.
Medicaid is a need-based health insurance program. If your assets exceed a certain amount, you cannot qualify for Medicaid.
Most people are going to qualify for Medicare when they reach the age of 65. Medicare is a government health insurance program as well. You become eligible for Medicare by paying into the program as you are paying taxes throughout your working career.
Generally speaking, if you qualify for Medicare you don’t have to worry about Medicaid in Davenport Iowa because you already have health insurance. In fact, it is unlikely that you would qualify for Medicaid because the upper asset limit is just $2000.
However, Medicaid does become relevant to many senior citizens. This is because of the fact that Medicare does not pay for long-term care.
Long-Term Care Implications
Most people in America will eventually need assistance with their day-to-day needs. This type of assistance is very expensive if you need to reside full-time in a nursing home or assisted living community. When you compare the average amount of money that the typical American has saved for retirement to the current long-term care costs, the figures simply don’t add up.
How much are we talking about? If you combine the average length of stay with the average cost for a private room in a nursing home you’re looking at a figure that exceeds $200,000 using current costs as a barometer. However, long-term care costs have been rising year-by-year.
An Unpleasant Scenario
Let’s look at an example that paints a compelling picture. You have retired, and you have saved around $200,000 for retirement. You have income that is sufficient to pay for your ongoing expenses. Going in you really don’t have to touch this money that you have saved.
You do nothing to prepare for long-term care costs. The time comes when you can no longer handle your activities of daily living on your own. You enter a long-term care facility and pay the expenses out-of-pocket.
Eventually, you go broke, but you still need living assistance. At that point you could potentially qualify for Medicaid to pay for it.
Most of the long-term care that is being received in the United States is paid for by Medicaid. If you take steps in advance, you can position your assets with future Medicaid eligibility in mind. By doing so you may be able to become eligible for the program without losing everything in the process.
The program rules allow for a certain amount of latitude if you are proactive. It is possible to make sure that a significant store of assets will remain available to your loved ones if you take the right steps.
If you’re interested in discussing Medicaid planning with a licensed elder law attorney in Davenport Iowa, contact our firm to request a free consultation.