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Medicare and Medicaid: Understanding the Difference

Medicare and Medicaid: Understanding the Difference

One of the most frequently asked questions we receive from Elder Law clients and their families are about the differences between Medicare and Medicaid. With over twenty years of experience in Elder Law, BB&C is here to help you navigate the ins-and-outs of each program, eligibility requirements, and the costs associated with coverage.

Medicare Basics

Medicare is a federal health insurance program for people aged 65 and older and disabled individuals of any age who qualify for Social Security. Those who are covered pay monthly premiums that are held in trust. Medicare then uses those funds to pay a portion of the medical bills for covered patients. Patients may be responsible for part of their medical expenses, such as health care or prescription deductibles.

Medicaid Basics

Medicaid is a limited income assistance program that helps pay health care costs. It serves people of any age who have limited incomes and resources. Typically, Medicaid will cover the cost of all medical expenses, although occasionally a small co-payment is required. Medicaid is a joint federal and state program run by state and local governments, therefore, the rules and requirements may differ from state to state.

Cost of Care

A common Medicare/Medicaid cost example is when an elderly person becomes sick or injured, finds him or herself in the hospital, then has to move directly a nursing facility for rehabilitation. Medicare typically covers a substantial portion of the hospital bills, and may also cover up to 100 days of rehabilitation at a nursing facility. If a patient needed to stay longer, the additional cost would all be out-of-pocket.

The overall cost for nursing home care can exceed $10,000 per month, potentially leading to a patient’s life savings being spent in just a few years, or even months. It is not until the total value of a person’s countable resources reaches $2,000 or less that Medicaid will begin assisting with the cost of care.

Long-Term Care Planning

Whether the need is immediate or in the future, planning for long-term care and determining how to pay for a nursing facility can be a daunting responsibility. At BB&C, we help protect a person’s wealth for their children and grandchildren by coordinating benefits provided by Medicaid and VA with guardianships, trusts, and other estate planning tools.

Contact Abigayle Hensley at 765-742-9066 to learn how Medicare and Medicaid coverage can fit within your personalized long-term care plans.

The content of this blog is intended to be general and informational in nature. It is advertising material and is not intended to be, nor is it, legal advice to or for any particular person, case, or circumstance. Each situation is different, and you should consult an attorney if you have any questions about your situation.

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