Medicaid is a jointly funded program between the federal government and the individual states that provide medical assistance for those who are medically needy and who qualify financially. Since it is a jointly funded program, each state has different laws when it comes to Medicaid.
Medicaid in Florida refers to many health-related programs, such as health care for the disabled, the poor, and various other programs.
This article will cover the two main Medicaid programs for the elderly:
- Florida’s Institutional Care Program (ICP Medicaid), and
- Home and Community-Based Services (HCBS Medicaid).
TIP:
Most people believe that Medicaid will only pay for nursing home care. However, Medicaid in Florida will pay for some in-home care and related home services, assisted living facility care, or nursing home care.
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What is the Difference Between Medicaid and Medicare?
Medicaid and Medicare are two completely different programs.
Medicare is a multi-part health insurance program that was created to help the elderly and the disabled. Medicare is not means-tested—meaning that assets and income do not matter when qualifying for Medicare—since Medicare qualification depends entirely on whether an individual over the age of 65 has worked enough to have paid enough credits into the Social Security system.
EXAMPLE:
Bill Gates is worth $106 billion dollars. Even though Bill Gates is worth $106 billion dollars, he will still be eligible for and qualify for Medicare when he reaches the required age because he has paid enough credits into Social Security.
Medicare will only pay for 100 days of skilled nursing facility care if a number of criteria are met.
Medicaid is a means-tested program—this means that you must qualify both asset and income-wise. If you qualify for Medicaid, Florida Medicaid will pay for an unlimited amount of nursing home care.
How Does Someone Qualify for Medicaid?
To qualify for Medicaid you must meet a three-part test:
- You must be medically needy;
- You must meet the asset test; and
- You must meet the income test.
In order to be medically needy, the Department of Elder Affairs (CARES) will assess the level of care that you need to determine which program you qualify for.
For Medicaid to pay for the nursing home this means that an individual must require skilled, intermediate, or custodial care. Generally speaking, this means that CARES will assess whether you can perform the activities of daily living (ADLs):
- Eating
- Bathing
- Dressing
- Toileting
- Transferring (e.g. getting out of bed without assistance), or
- Maintaining continence.
If CARES determines that you are unable to perform or can’t significantly perform 4 out of the 6 ADLs listed above then you will qualify for nursing home Medicaid.
Florida Medicaid Asset Test
A Florida Medicaid applicant must also meet the asset test. This means that a single Medicaid applicant can only have $2,000 (2019) in assets in their name.
If the applicant is married and both the applicant and both spouses are applying for Florida Medicaid, then they are allowed $3,000 in assets.
CAUTION:
A penny over asset wise—$2,000.01 for a single applicant—will cause the applicant to be disqualified from Medicaid asset wise.
EXAMPLE:
Jimbo’s dementia has worsened and he must be placed into a Florida nursing home within the next month. Jimbo’s wife, Delilah, is currently taking care of him at their home. Jimbo and Delilah have a joint bank account at SunTrust worth $5,000. Jimbo is a single applicant since he is the only one applying for Florida Medicaid. He can only have $2,000 in assets in his name. Since there is $5,000 in Jimbo and Delilah’s joint bank account, Jimbo will not be qualified for Medicaid asset wise. Jimbo will need the services of a competent Florida Elder Law attorney so that he can qualify for Medicaid.
Many of our estate planning clients immediately hear the word Medicaid and they think that they automatically do not qualify for Medicaid because they think Medicaid is a program only for those who cannot afford the nursing home. We then tell our clients that we could get even Bill Gates qualified for Medicaid.
While getting Bill Gates qualified for Medicaid may be a bit of a stretch, the reality is that even those with hundreds of thousands of dollars—even millions—can qualify for Medicaid. The reason is that some assets are considered exempt for Medicaid purposes (e.g. your Florida Homestead) and some assets are non-exempt (e.g. Jimbo and Delilah’s SunTrust Bank Account).
TIP:
Be cautious when you hear people refer to spending down of assets. If Medicaid planning is done properly there should be very little, if any, actual spending of the assets. Proper planning can preserve the majority—and in some cases all—of an applicant’s assets.
Florida Medicaid Income Test
The Medicaid income test is much more straightforward than the asset test. A Medicaid applicant can only earn $2,313 (2019) of income per month. If the applicant earns even a penny more—$2,313.01—then the applicant does not meet the income test for Medicaid and is disqualified.
Just like the asset test, the income test can still be met even if an applicant is above the allowed amount of income per month.
EXAMPLE:
Jimbo’s monthly income consists of $1,500 per month in Social Security and $1,000 per month from a General Electric Pension. Jimbo’s gross monthly income is $2,500 per month, which is higher than the $2,313 (2019) allowed by Medicaid. Thus, Jimbo is not eligible for Medicaid income-wise and he will need to meet with a competent Florida Elder Law Attorney to shift his income so that he will meet the Medicaid income requirements.