A reader recently asked for an explanation of the differences between the Medicare and Medicaid programs. The following are excerpts from my book, New Jersey Elder Law: A Planning and Resource Guide.
Medicare is a federal health insurance program for qualified aged and disabled individuals. Medicare is funded through deductions from a future beneficiary’s wages. Generally speaking, Medicare is available to individuals who are 65 years of age or older and who are entitled to Social Security benefits. Medicare is also available to individuals who are disabled and who have been receiving Social Security disability benefits for not less than 24 months. Medicare coverage is broken down into parts. Each part provides a different bundle of coverage for health care costs.
Part A provides in-patient hospital care, in-patient care in a skilled nursing facility, home health care services and hospice care. As an elder law attorney, the skilled nursing facility (SNF) coverage will be the Part A Medicare coverage with which you and your clients will have the most interaction.
Skilled Nursing Facility Services
A skilled nursing facility is, in most instances, the rehabilitative section of a nursing facility or nursing home. The family member of a client will come to you and say, “Mom is in a rehab center right now, but we are thinking about moving her to a nursing home.” The fact of the matter is that mom is already in a nursing home, she’s simply in the wing or section of the nursing home that the nursing home has designated as its skilled nursing/rehabilitative care section.
Days of Coverage
Medicare Part A coverage will provide up to 100 days of SNF care per spell of illness for in-patients requiring skilled or rehabilitative services. A spell of illness begins when the patient received Medicare covered services as an in-patient in a hospital and ends when the patient has spent 60 days outside of the hospital or SNF or ceased receiving Medicare-covered services in the nursing facility.
In order to receive SNF coverage, the patient must have been hospitalized for at least three days and must enter the SNF within 30 days of being discharged from the hospital for skilled or rehabilitative care. From a practical standpoint, most of your clients will be discharged directly from the hospital to the SNF. A physician must certify that the skilled or rehabilitative care in the SNF is necessary.
Assuming these criteria are met, during a spell of illness, the patient is entitled to full coverage for days 1 through 20. For days 21 through 100 there is a co-payment that is the responsibility of the patient. The co-payment typically increases on an annual basis. In 2015, the daily co-payment is $157.50.
Full Time Rehabilitation
In order to receive Part A coverage in a SNF, the patient must require skilled or rehabilitative services on a daily basis and the care must only be available in a SNF. A daily basis means five days per week.
Medicaid is a federal-state cooperative health payment plan for needy individuals. The federal government offers the various states the opportunity to participate in the Medicaid program. A state is not required to participate in the program. Of course, if a state does not participate in the program, then the State will not receive federal monies for Medicaid. The federal government often contributes more than 50% of the costs associated with the Medicaid program. New Jersey does participate in the Medicaid program and offers various programs of Medicaid to its citizenry.
In order to qualify for Medicaid, an applicant must have limited assets and income. The assets figure is typically very low, frequently no more than $2,000 countable assets. The income figures vary widely depending upon the program of Medicaid from which the applicant seeks benefits.
Unlike Medicare, Medicaid will pay for long-term custodial care, such as care in a nursing home, that may last for years and years.
If you are interested in obtaining my book, you can contact the New Jersey Law Journal at 973-642-0075 or contact Doug Brown at email@example.com.