FAQS

COMMON QUESTIONS ABOUT MEDICAID

1. WHAT IS MEDICAID? Medicaid, which is also called Medical Assistance, is a program, which pays the medical bills of certain needy and low income individuals. It is administered by the State and pays medical bills with Federal and State funding.

2. WHAT IS MEDICARE? Medicare is an insurance program, which pays medical bills for insured persons, with money from the Social Security Trust Fund. Medicare is for most everyone who is age 65 or older. Medicare also helps disabled persons who are under age 65 who have been receiving Social Security Disability Insurance payments for 2 years. Medicare pays for nursing home services under very limited circumstances.

3. A MEDICARE card is good for a lifetime after you become insured.

4. A MEDICAID card is good only for the period during which a person meets all of the technical and financial requirements for eligibility.

5. WHAT WILL I NEED TO DO WHEN I APPLY? You will need to complete and sign a Medicaid application form. The application form will request complete and detailed information on your financial situation. You will have to show that this information is true and verifiable before a decision on your eligibility can be made. An interview is required as part of your application process.

6. WHAT DETERMINES IF MEDICAID WILL PAY FOR MY NURSING HOME CARE? Provided you are a U.S. citizen, a Maryland resident, a registered immigrant/naturalized and at least 65 years of age or disabled, eligibility for Medicaid is based on your income and resources (assets). Income includes wages, Social Security benefits and pension. Resources include bank accounts, stocks, bonds, property, life insurance, valuable collections, more than one (1) vehicle, boat, trailer and IRA accounts. The way income and resources are evaluated to determine the amount that you can retain and be eligible for Medicaid are set by law.

Additionally, in order for Medicaid to pay for your nursing home care, there must be a determination that you need the health care services provided by a nursing home, (medical level of care).

7. HOW ARE RESOURCES TREATED? Note: If you are married, your resources are treated differently than they are if you do not have a spouse. See question 10.

Your countable resources cannot exceed $2,500. If you exceed this limit by $1 at any time during a month (with the exception of income being received and immediately paid out to the nursing home), you will be ineligible for Medicaid for the entire month. Be mindful that if monthly income is received and not applied and/or spent on the Applicant's cost of care within the same month received, the income is treated as an asset against the Applicant.

8. WHAT RESOURCES ARE NOT COUNTED? Your home, providing it is your principle place of residence, a spouse or dependent relative lives in the home, or you express an intent to return to the home. If your home is not occupied by a spouse or certain relative, and you have a life estate deed with full powers to sell the property, the full fair market value of the home is treated as an asset.

• Ordinary household goods and personal effects.
• A vehicle
• Life insurance with a combined face value of less than $1,500. If the face value of one policy or the commulative face value of more than one policy is in excess of $1,500 the full cash value of the policy of policies are treated as an asset.
• Burial spaces for immediate family members.
• Term life insurance, which typically does not have cash value.
• An irrevocable funeral service trust or final expense policy.

9. WHAT HAPPENS IF I HAVE TOO MANY RESOURCES? Resources over the $2,500 limit must be used in several ways just so long as they are not given away or exchanged for something of a lesser value.

10. HOW ARE MY RESOURCES TREATED IF I HAVE A SPOUSE IN THE COMMUNITY WHEN I APPLY? When you apply for Medical Assistance, as assessment will be made of the total value of you and your spouse's combined countable resources as of the first day of the first month one of you enters a nursing home.

11. WHAT IS A MEDICAID LIEN? A Medicaid lien is a claim against your home property equal to the dollar amount of correct payments the Medicaid Program has made on your behalf.

12. WHEN WILL A LIEN BE PLACED ON MY HOME? If the State of Maryland Medicaid Program determines and verifies that there is no reasonable expectation that you will return home from the nursing facility, the State will place a lien on your excluded home property unless it is occupied by one of the following: spouse, your unmarried child under 21, a son or daughter who is blind or disabled, or a sibling who has an equity interest in the home and who has resided in the home for at least one year prior to you entering the nursing home.

The lien is lifted if you return to the home residence.

When you die or your home is sold, no recovery will be sought through the lien if you have a surviving spouse, a surviving child who is unmarried and under 21, or a child who is blind or disabled. Also no recovery will be sought as long as your home is occupied by a sibling who has an equity interest in the home, and who was residing there at least one year before you went into the nursing facility; or a son or daughter who has lived in the home for a least two years before you went in to the nursing facility and provided care which kept you out of the nursing facility.

13. WILL MEDICAID SEEK RECOVERY FROM MY ESTATE WHEN I DIE? Medicaid will seek recovery of payments correctly made if you were 55 years old or older when you received Medicaid, but only after the death of your spouse and only if you have no surviving unmarried child under 21 years of age or a son or daughter who is blind or disabled.

14. HOW IS AN ACCOUNT TREATED WHICH YOU OWN WITH SOME ONE ELSE? The full value of an account is considered to belong to you, the applicant, unless the other owner(s) can document that some or all of the funds are his or hers by contribution. Additionally, certain account titling requires joint consent and agreement in order to access the account. This may render an account unavailable for the purpose of the resource assessment.

15. WHAT IS A "LOOK BACK" PERIOD? When you apply for Medicaid as an institutionalized person, the State will look at your finances for a certain period of time prior to your application to see if you, your spouse, or anyone else has transferred any of your resources or income at less that fair market value. The earliest date that can be looked at is called at "look back" period. Any transfer for less than fair market value made on or after that date may result in a period of ineligibility to qualify for Medical Assistance benefits.

16. HOW IS THE LOOK BACK PERIOD DETERMINED? This date will be from 36 months (3 years) prior to the month you apply for benefits and are institutionalized. If you have established a trust, the look back period may be up to 60 months (5 years) prior to the month you apply.

17. CAN I TRANSFER MY HOME? The transfer of your home is not penalized if it is transferred to your spouse; your child who is blind or disabled; your unmarried child who is under 21; your child who has lived in the home for at least two years before your went into the nursing home and provided care which kept you out of the a nursing home; or your brother or sister who has an equity interest in the home ands has lived there at least one year before you went into the nursing home.

18. IS THE TRANSFER PENALTY EVER WAIVED? A transfer at less then fair market value is not penalized if you can proved that the transfer was made exclusively for a purpose other than becoming eligible for Medicaid. This is an area of discussion that seldom has a successful outcome.

19. HOW IS INCOME TREATED? Any income received in your name is counted. Income in your spouse's name is not counted. See question 20 if you are married.

Income includes all of the income you receive. From this income, certain deductions are allowed:

• $66 personal needs allowance, which you can use for personal expenses such as toiletries, clothing etc.
• An amount for your spouse (Spousal Income Allowance See Question 20).
• If you lived alone, you intend to return to your home, and it is medically reasonable to expect that you will be able to return to your home within six months, a limited monthly allowance (maintenance needs allowance) to maintain your home for a maximum of the first six months you are in the nursing home.
• The cost of any health insurance premiums, including Medicare.

If your monthly income, after these deductions, is less than the monthly cost of care, you will meet the income eligibility criteria for Maryland Medicaid benefits in a nursing home.

The income remaining after these deductions must be paid to the nursing home. Medical Assistance benefits subsidizes your monthly income to pay the balance of the nursing home expenses up to the maximum that the nursing home is entitled to charge under the Maryland Medicaid Program.

20. WHAT INCOME CAN MY SPOUSE LIVING AT HOME KEEP IF I GO INTO A NURSING HOME? When one spouse goes into a nursing home, Medical Assistance allows the spouse who remains at home to keep a certain level of income. If you enter a nursing home, your spouse living at home may keep the greater of:

All income paid in your spouse's name, no matter how large the sum,

All income paid in the spouse's name plus as much of your income as is necessary to bring your spouse's income up to $1,712 a month. If your spouse's housing costs are high, the $1,712 can be increased up to $2,610 (these amounts change yearly).

Please be advised that this information is general in content and not specific to any one situation. The Maryland Medicaid Program is governed by laws that are amended frequently. These laws originate at the Federal and State levels, and are enforced by the Maryland Department of Health and Mental Hygiene according to their own policies. This information is offered as a broad overview of some of the regulations that promote frequent questions.