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Medicaid Planning

Planning for long-term care is one of the most an important decisions our client's can make during their lifetime. However, very few people have well defined plans for dealing with related expenses.

Protectecting our Clients Life Savings

Planning for a client’s long-term care is an important decision that most of the population will face one day. In addition, as the quality of health care here in America improves, our lifespan extends and the use of nursing homes becomes more commonplace. That's just one reason why Medicaid planning strategies are getting so much attention.

Many nursing home residents end up exhausting their assets on long-term care. But, with an advisor on top of their game, it doesn't have to be that way. The best time to plan for the possibility of nursing home care is when the client is still healthy. By doing so, they may be able to pay for their long-term care and protect assets for your loved ones.

Over the years, Medicaid planning has become one of the most important elements of a solid financial plan. Your client worked hard all their life to pay off the mortgage and build a comfortable retirement fund. They expected to live off their savings in the comfort of their own home, and planned to leave something to their children at the appropriate time. Suddenly, the unthinkable happens – they suffer a stroke at age 70, and must spend the rest of your years in a nursing home. What will happen to their life savings?

CMS Official Overview

Medicaid is available only to certain low-income individuals and families who fit into an eligibility group that is recognized by federal and state law. Medicaid does not pay money to you; instead, it sends payments directly to your health care providers. Depending on your state's rules, you may also be asked to pay a small part of the cost (co-payment) for some medical services.

Medicaid is a state administered program and each state sets its own guidelines regarding eligibility and services. Many groups of people are covered by Medicaid. Even within these groups, though, certain requirements must be met. These may include your age, whether you are pregnant, disabled, blind, or aged; your income and resources (like bank accounts, real property, or other items that can be sold for cash); and whether you are a U.S. citizen or a lawfully admitted immigrant. The rules for counting your income and resources vary from state to state and from group to group. There are special rules for those who live in nursing homes and for disabled children living at home.

Children may be eligible for coverage if he or she is a U.S. citizen or a lawfully admitted immigrant, even if you are not (however, there is a 5-year limit that applies to lawful permanent residents). Eligibility for children is based on the child's status, not the parent's. Also, if someone else's child lives with you, the child may be eligible even if you are not because your income and resources will not count for the child.

In general, you should apply for Medicaid if your income is low and you match one of the descriptions of the Eligibility Groups. (Even if you are not sure whether you qualify, if you or someone in your family needs health care, you should apply for Medicaid and have a qualified caseworker in your state evaluate your situation.)

When Eligibility Starts

Coverage may start retroactive to any or all of the 3 months prior to application, if the individual would have been eligible during the retroactive period. Coverage generally stops at the end of the month in which a person's circumstances change. Most States have additional "State-only" programs to provide medical assistance for specified poor persons who do not qualify for the Medicaid program. No Federal funds are provided for State-only programs.

What is Not Covered

Medicaid does not provide medical assistance for all poor persons. Even under the broadest provisions of the Federal statute (except for emergency services for certain persons), the Medicaid program does not provide health care services, even for very poor persons, unless they are in one of the designated eligibility groups. Low income is only one test for Medicaid eligibility; assets and resources are also tested against established thresholds. As noted earlier, categorically needy persons who are eligible for Medicaid may or may not also receive cash assistance from the TANF program or from the SSI program. Medically needy persons who would be categorically eligible except for income or assets may become eligible for Medicaid solely because of excessive medical expenses.

Direct links to each state’s Medicaid website









District of Columbia




















New Hampshire

New Jersey

New Mexico

New York

North Carolina

North Dakota





Rhode Island

South Carolina

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West Virginia



  • Featured Article


    By Robert Pear
    New York Times

    WASHINGTON — Budget negotiators have not found a way to avert a government default on federal debt obligations, but with their ideas to cut Medicare and Medicaid they have managed to provoke opposition from almost every major group that represents beneficiaries and health care providers.

    The latest provocation was a list of proposed savings presented at the White House this week by the House majority leader, Representative Eric Cantor, Republican of Virginia.

    Mr. Cantor said Tuesday that the ideas had all been seriously discussed, with varying levels of Democratic support, in seven weeks of negotiations led by Vice President Joseph R. Biden Jr.

    But with House Republicans adamantly opposed to new taxes, Democrats said they would not accept cuts in Medicare that reduced benefits.

    Mr. Cantor’s list included 27 proposals that he said would save up to $353 billion over 10 years, in the context of a budget deal that could save anywhere from $2 trillion to $4 trillion over the same period. Items on the list touched off howls of protest from lobbyists and Democratic lawmakers who saw details for the first time on Tuesday.

    Some of the proposals would hit Medicare patients in the pocketbook, charging co‐payments for home health care and clinical laboratory services like blood tests. One proposal would increase premiums and co‐payments for beneficiaries with relatively high incomes. Another would require millions of recipients to pay more of the costs now covered by private insurance policies that supplement Medicare.  
    The Congressional Budget Office says the proposal could save Medicare up to $53 billion over 10 years, mainly by curbing the use of health care by people with supplemental coverage known as Medigap policies. Studies show that such policyholders use about 25 percent more services than Medicare patients who have no supplemental coverage, the budget office said. 

    But Medigap policies are popular with older Americans, who like the financial security they get from the extra insurance.  “The Medigap proposal would shift costs onto Medicare beneficiaries,” said Howard J. Bedlin, vice president of the National Council on Aging, a service and advocacy group. “Our fear is that many would go without the care they need and end up in a hospital emergency room, which costs Medicare more than proper treatment would have cost.”  

    Likewise, Mr. Bedlin said, the proposed co‐payments for home health care would “significantly increase out‐of‐pocket costs for many low‐income widows with multiple chronic conditions.” When such co‐payments were seriously considered in the past, Democrats wheeled some of the widows into the Capitol to denounce the idea.  

    Mr. Cantor’s list includes $100 billion in savings from Medicaid over 10 years — the same amount sought in a White House proposal that has caused consternation among some officials at the Department of Health and Human Services.  

    aboratories were surprised to learn Tuesday of the proposal to start charging Medicare beneficiaries a $1 co‐payment for each lab test. Lab tests and home health visits are now exempt from such cost‐sharing.  

    Alan B. Mertz, president of the American Clinical Laboratory Association, a trade group, said that collecting the co‐payments from beneficiaries would be “a huge administrative hassle.”  

    The average lab test costs $12 or $13, Mr. Mertz said, and labs typically “do not have a face‐to‐face relationship with patients.” In many cases, he said, “we will not be able to collect the money, or the cost of collecting it will be more than the amount of the co‐payment.” Representative Paul D. Ryan, Republican of Wisconsin and chairman of the House Budget Committee, said the din of criticism was disappointing.  

    “These are not big Medicare savers,” Mr. Ryan said in an interview. “They do not save a lot of money in the whole scheme of things. If we come to a political paralysis over a few hundred billion dollars, the credit markets will really start turning on us.”  

    The Obama administration said Tuesday that instead of cutting benefits or increasing co‐payments, Congress should increase the power of an independent agency, created by the new health care law, to make sweeping cuts in the growth of Medicare spending.  

    At a hearing of the House Budget Committee, Kathleen Sebelius, the secretary of health and human services, said the new agency, the Independent Payment Advisory Board, would be a backstop to ensure a sharp reduction in the growth of Medicare spending per beneficiary.  

    Mr. Ryan said the 15‐member board was “just a mechanism to take power out of the hands of politicians so they can absolve themselves of responsibility for the inevitable price controlling and rationing that is to come in Medicare.” Such rationing, he said, “is not necessary if you do fundamental Medicare reform.”


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