In the United States, health care services for older adults are funded mainly by Medicare, Medicaid, the Veterans Health Administration, private insurance, and out-of-pocket payments. In addition, many states offer health-related benefits and programs, such as subsidies for transportation, housing, utilities, telephone, and food expenses, as well as help at home and nutrition services. Health care workers should help older patients learn about health benefits and programs to which they are entitled.
Funded by a federal-state partnership, Medicaid pays for health services for certain categories of the poor (including the aged poor, the blind or disabled, and low-income families with dependent children). The federal government contributes between 50% and about 76% of the payments made under each state’s program; the state pays the remainder. Federal reimbursement is higher for states where incomes are lower. About 10% of older adults receive services under Medicaid, accounting for about 40% of all Medicaid expenditures. Medicaid is the major public payer for long-term care.
Services covered under federal guidelines include inpatient and outpatient hospital care, laboratory and x-ray services, physician services, skilled nursing care, nursing home care not covered by Medicare, and many home health services for people > 21 years.
States may cover certain other services and items, including prescription drugs (or the premiums for Medicare Part D if patients are eligible for Part D), dental services, eyeglasses, physical therapy, rehabilitation services, and intermediate-level nursing care. Each state determines eligibility requirements, which therefore vary, but people receiving funds from cash-assistance programs (eg, the Supplemental Security Income program) must be included. Several states offer enriched packages of Medicaid services under waiver programs, which are intended to delay or prevent nursing home admission by providing additional home and community-based services (eg, day care, personal care, respite care).
Eligibility depends on income, assets, and personal characteristics. The Affordable Care Act includes expansion of Medicaid coverage to all people < 65 with an income < 133% of the federal poverty level if they reside in a state that elects to expand Medicaid; however, many states have opted not to expand.
Most states have other criteria that allow people to qualify for Medicaid.
Assets, excluding equity in a home and certain other assets, are also considered. If the remaining assets exceed the limit, people are not eligible for Medicaid, even if their income is low. Thus, older adults may have to spend down (ie, pay for care from personal savings and sale of assets until stringent state eligibility requirements are met) to qualify for Medicaid. How much of monthly income and of the couple’s assets that the spouse of a nursing home resident may keep varies by state. Divestment of assets at below fair-market value during the 5 years (2.5 years in California) before applying for Medicaid may delay coverage for a period of time that is determined by the amount of inappropriately divested funds divided by the average monthly cost of nursing home care in the state. For example, if a person gives away $10,000 in a state where the average monthly cost of care is $3500, Medicaid coverage is delayed by about 3 months.
State Medicaid programs are required to recover certain paid benefits (eg, for nursing facility services, home and community-based services, and related hospital and prescription drug services) from the estates of deceased Medicaid recipients. Recovery may optionally include payments for all other services except for cost-sharing payments made through Medicare Savings Programs. Typically, recovery may be made only from estates of recipients who were ≥ 55 years when they received Medicaid benefits or were permanently institutionalized regardless of age. Recovery is not made if the deceased is survived by a spouse, child under age 21, or blind or disabled child of any age.
The definition of estate varies by state. Some states include only property that passes through probate; others include assets that pass directly (eg, through joint tenancy with right of survivorship, living trusts, or life insurance payouts). Some states protect the family home from Medicaid claims. The vigor with which claims are pursued varies by state and by case.
People who are currently eligible for Medicare and whose income and assets are below certain thresholds are eligible for Medicare Savings Programs. These programs are run by individual state Medicaid programs and help to pay Medicare costs and certain out-of-pocket expenses not covered by Medicare. There are 4 programs:
The Qualified Medicare Beneficiary (QMB) Program—helps pay Part A and Part B premiums, deductibles, and co-insurance
The Specified Low-Income Medicare Beneficiary (SLMB) Program—helps pay Part B premiums
The Qualifying Individual (QI) Program—helps pay Part B premiums
The Qualified Disabled Working Individual Program—helps pay Part A premiums
People who qualify for QMB, SLMB, or QI automatically qualify for Medicare Extra Help, which helps pay Medicare Part D (prescription drug coverage) monthly premiums, annual deductibles, coinsurance, and copayments.
The federal government has set eligibility requirements based on income and asset value. States are free to adopt less restrictive requirements (eg, permitting enrollment at a higher income level). People enroll through state Medicaid offices.