Early in my legal career, I worked as Assistant Attorney General for the State of Connecticut under then Attorney General Joe Lieberman. My job there was to prosecute Medicaid fraud cases. In most cases, people were not intending to dupe the State of Connecticut; they just received bad advice. Senator Lieberman taught me to explain the law in ways people can understand and to also protect their rights.
Seniors often feel that they are doing something wrong, illegal or improper if they try to protect what they have worked for during their lifetime. Seniors are often surprised to find out that there are safeguards in the law to prevent this from happening. This is especially true when dealing with married couples who have a healthy spouse in the community.
Since few people have long-term care insurance or can afford to pay the high cost of nursing home care out-of-pocket, most people eventually qualify for Medicaid. By default, it has become the primary source of funding for nursing home care and is the long-term care insurance of the middle class.
Although their names are somewhat alike, Medicaid and Medicare are quite different programs. Medicare is an “entitlement” program, meaning that everyone who reaches age 65 and is entitled to Social Security benefits, also receives Medicare. Medicaid, on the other hand, is a form of welfare – or at least that’s how it began. To be eligible for Medicaid, you must become “impoverished” under the program’s guidelines. This terminology, however, is incorrect in that most married couples can qualify for Medicaid without spending down at all.
Also, unlike Medicare, which is totally federal, Medicaid is a joint federal and state program. Each state operates its own Medicaid system, but this system must conform to federal guidelines in order for the state to receive federal funding, which pays for about half the state’s Medicaid costs.
This complicates matters since Medicaid eligibility rules are somewhat different from state to state and the rules keep changing. Both the federal government and most state governments seem to be continually tinkering with the eligibility requirements.
This most recent change occurred with the passage of the Deficit Reduction Act of 2005 ( the “DRA”), which was enacted on February 6, 2006, and significantly changed the rules governing the treatment of asset transfers and home of nursing home residents. The implementation of these rules differs from state to state. To be certain of your rights in Connecticut, consult an elder law attorney.
Congress specifically enacted federal laws that prevent the community or healthy spouse from becoming destitute if their spouse falls ill. But how do you find out about these exceptions? You need to be careful who you are getting advice from and seek out these exceptions on your own, independent of those whose interests may conflict with yours. Again, you have legal rights. You just need to know what they are.