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Understanding Medicaid for Dementia

Medicaid, the nation's public health insurance program for low-income people, now covers nearly 60 million Americans, including many working families...

Medicaid is a vital program that provides needed medical services, including adult day care, in-home care and even nursing home care services for seniors who cannot afford to pay for their own care. Understanding Medicaid, however, can feel like a puzzle. What services are covered? Who is eligible for services?

Knowing what benefits are available can help many seniors plan for their care during the twilight years of their lives — and even more importantly, it can help the adult children responsible for parents with dementia understand what options are available when it comes time to provide care for their loved ones. Here are some pointers shared by Senior Planning Services, a Medicaid planning and consulting company that assists seniors with their Medicaid eligibility.

Medicaid Services for Individuals with Dementia

Medicaid is the service that stands in the gap that Medicare doesn’t cover. For individuals with dementia, there are a number of vital services that are covered by Medicaid. These include:

  • Nursing facility services

  • Home health care services

  • Home health aides, durable medical equipment and other services that will make it possible for an individual to stay at home longer

  • Physician visits

  • Non-emergency transportation, specifically for medical care

Many states also offer programs specifically targeted for individuals with dementia, including home and family care options, memory care units, and meal delivery services or help with chores for individuals who are no longer able to complete those tasks for themselves. Long-term care provided by Medicaid is often one of the most important services offered to individuals with dementia, who will eventually require care in an assisted living facility or nursing home.

There are also additional veterans’ assistance programs in place to provide more help for our nation’s heroes and their spouses.

Determining Eligibility for Medicaid for Dementia

In order to receive Medicaid assistance for long-term care or home and community care, an individual must have a clear need for assistance with the activities of daily living.

Most states insist that an individual need those services in order to keep them from needing to enter a nursing home before they become eligible.

Though most Medicaid beneficiaries are also eligible for Medicare, Medicare typically doesn’t cover all the services that are necessary in order for the individual to live a quality life.

Financial Eligibility for Medicaid

To be financially eligible for Medicaid, applicants must meet strict income and asset guidelines.

In general, annual income must be less than or equal to the federal poverty level — monthly income for an individual in 2015 is $825 and for a couple $1,209. Individuals must also possess limited assets. Several assets don’t count. An individual may continue to own their own home as long as a spouse or minor child continues to reside there or they have plans to return to their home following a period in an assisted living facility. A single vehicle, burial plans up to a limit determined by the state, and several other assets do not count against the individual who is hoping to qualify for Medicaid.

There is also spousal impoverishment protection that prevents a spouse who will not be receiving Medicaid benefits or living in an assisted living facility from having to spend down all of their resources in order for the other spouse to qualify.

Individuals who are hoping to qualify for Medicaid need to be careful how they “spend down” or otherwise redistribute their resources. While repairs to a home, personal clothing, and health expenses are all valid uses of that money, large gifts given to children or other family members within five years of Medicaid application can cause a senior to be ineligible for Medicaid for a period of time. In the case of excess income that might otherwise disqualify an individual from Medicaid, it is also possible to set up a trust fund that is designated specifically for medical and some other expenses in order to make Medicaid qualification possible.

Applying for Medicaid for Dementia

The first step in determining Medicaid eligibility is filling out a Medicaid application, which can be found online:

Before beginning, it’s necessary to put together a folder of documents that include proof of residence, proof of assets and other resources including bank statements, proof of age and citizenship, and proof of income. The application should be selected according to the individual’s state of residence. Once the application is completed, it should be checked for accuracy and then sent in as soon as possible.

Individuals who believe that they may qualify for Medicaid, even if they aren’t sure, are encouraged to go ahead and fill out the application — they may be surprised by the services that they’re able to receive. It’s important that each part of the form be filled out in full before it’s sent in; many applications are rejected as a result of incomplete or inaccurate information.

Medicaid can significantly lessen the burden of end-of-life care for individuals with dementia. With proper planning and armed with the necessary information, family caregivers can make it easier for their loved ones to live out their lives in peace.

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