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Medicaid ˈmed-i-ˌkād

by Amal Trivedi, MD, MPH

Medicaid is a program funded jointly by the federal and state governments to help pay for health care. It is intended for people of all ages who have a very low income and few assets. Eligibility requirements for Medicaid vary from state to state. People who are on Medicare may also qualify for Medicaid, which helps pay for some expenses not covered by Medicare.

If people have a very low income but have assets such as a home or stock investments, they may not qualify for Medicaid. To qualify, they may have to spend down. That is, they may have to sell their stocks and other assets and use the money to pay for health care until their income plus assets is low enough to qualify. To avoid having to spend down, some people give their assets away, often to family members. However, to qualify for Medicaid, they cannot have given these assets away within the 3 years before care was needed. In some states, people may be able to keep their home so that certain family members can remain there. However, when the family members leave, the government can sell the home to recover the money it has spent on care.

If people qualify for Medicaid and Medicare, most health care costs are covered.

Medicaid is the main public payer for long-term care, such as skilled nursing care (including that in a nursing home). For older people, Medicaid often pays for nursing home care. Medicaid is required to offer long-term care to eligible people who are 21 years or older and who participate in the Medicaid program. Medicaid also helps pay for the following:

  • Hospital care

  • Laboratory tests (such as blood and urine tests)

  • Diagnostic tests (such as x-rays)

  • Visits to the doctor

  • Skilled nursing care

  • Vaccinations

  • Home health care

Because each state manages its own Medicaid program, the services covered vary from state to state. In some states, Medicaid helps pay for other items, such as prescription drugs, dental care, eyeglasses, and intermediate-level nursing care. Intermediate-level nursing care involves less care than skilled nursing care but more care than personal care. Its purpose is to maintain a person’s condition and, if possible, to improve it.

Health care practitioners who provide care to people covered by Medicaid must accept what Medicaid pays as their full reimbursement. However, because this rate is often low, some practitioners choose not to provide care to people covered by Medicaid. Also, some nursing homes do not accept Medicaid insurance.