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Medicare vs. Medicaid

Who Covers Nursing Home Costs?

Medicare vs. Medicaid - Who Covers Nursing Home Costs? 

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One of the questions asked often is "Who covers nursing home costs? Medicare or Medicaid"? Because staying in a nursing home may be covered by either Medicare or Medicaid, it can be confusing to determine which program will over your family member’s length of stay. There are some important differences.

Medicare Coverage of Nursing Home Costs

The person must:

  • Have been hospitalized for medically necessary “inpatient” hospital care for at least three consecutive days, not counting the date of discharge.

  • Be admitted to the nursing home within 30 days after date of discharge from the hospital.

  • Require skilled nursing or rehab care on a daily basis for a condition for which the patient was hospitalized, and receiving a physician’s order that care us needed.

The Difference Between Skilled Care & Custodial Care

Skilled care is care that can only be administered by professional (physician or nurse) or technical personnel, and which will prevent further deterioration in the patient’s health. Examples include: intravenous feeding, injections, insertion of catheters, application of sterile dressings, treatment of skin ulcers, and therapeutic exercises of various kinds (physical therapy). Less medically-intensive and critical personal care services- even if performed by a nurse-are not considered skilled care.

If the care the patient requires is not considered “skilled care” as defined above, “it is called “custodial nursing home care.” This is a type of long-term care which is typically received in a nursing home. Only Medicaid – NOT Medicare-covers “custodial nursing home care.”

The Co-Pay Rule

Medicare will only cover a patient for a maximum of 100 days (per separate spell of illness) – if it covers the patient at all! During days 1-20, Medicare will cover the “entire” cost of the nursing home stay. For days 21-100, the patient must pay a co-pay, which is currently set at $161 per day. If care is needed beyond the 100 day limit – or if the patient is no longer needing skilled or rehab care “before” 100 days have passed – then the patient either pay privately, be covered by some form of insurance or qualify for Medicaid.

Medicaid Rules for Skilled Nursing Payments

Medicaid is a “need-based” program, meaning that the patient cannot have more than a certain minimal amount of assets and income in order to be covered. Medicare, on the other hand, is available regardless of the patient’s income or assets. If they meet the other assets, if they meet the other requirements listed above. Also, there is no mandate that a patient require skilled or rehab care in order to be covered by Medicaid, as there is for Medicare.

Note: Dual-Eligibility

Finally, keep in mind that it is possible to be covered by Medicare and Medicaid, simultaneously. Such individuals are known as “dual Eligibility” which means Medicaid covers those expenses not covered by Medicare. Example: Such as paying medicare premiums and cost-sharing requirements and light custodial care.

Brenda Dever-Armstrong, CEO/CSA/Owner
The Next Horizon Seniors & Military Advocate/Resources/Placement

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