People who have not looked into the subject thoroughly sometimes have questions about Medicaid, Medicare, and Medi-Cal. What are they all used for, and who qualifies for what? In this post we will provide some answers.
When you see deductions being taken out of your earnings, one of them is going toward Medicare. This is a federal government program that provides health care insurance to eligible senior citizens.
There are various different parts of Medicare. Medicare Part A pays for hospital stays, but there is a deductible that you have to pay out-of-pocket. There can also be co-payments. Medicare Part B is used to pay for your visits to doctors. There is a monthly premium that must be paid for this coverage. The amount of the premium varies depending on your income. Higher income people will pay a higher premium than lower income people.
There is also a Medicare Part C which involves using your benefit to get coverage through a private provider. Part D is the voluntary prescription drug portion of the program.
Under currently existing laws, Americans who have paid into the program sufficiently become eligible for Medicare coverage at the age of 65. If you are planning ahead for retirement, you should keep an eye on the ongoing debates over the budget because some legislators want to raise this age. Raising the age of Medicare eligibility would save the government money.
Medicaid & Medi-Cal
Medicaid is intended to provide a health care safety net for people who have virtually no financial resources. Medicaid is jointly administered by the federal government and each individual state. In the state of California, the program that is called Medicaid in most states is called Medi-Cal. This should clear up one source of confusion.
Unlike Medicare, Medi-Cal is not specifically designed for seniors, but many seniors receive Medi-Cal assistance even if they were never particularly poor throughout their lives. This is because Medi-Cal will assist with long-term care costs while Medicare will not.
It can be a rude awakening if you never heard about any of this, but long-term care costs are exorbitant. A year-long stay in a nursing home in northern California can easily cost over $100,000. The average length of stay is a bit over two years, but 10% of nursing home residents remain in the facilities for at least five years.
For many people, the numbers simply don’t add up even if they enter into retirement with a reasonable nest egg. As a result, a significant percentage of elders wind up utilizing Medi-Cal when they need long-term-care.
With the assistance of an elder care attorney, you may be able to plan ahead with Medi-Cal eligibility in mind. If you take the proper steps, you can preserve a maximum store of assets for the benefit of your loved ones as you spend down to stay within the upper asset limits.
If you would like to learn more about Medi-Cal Planning, we offer free Medi-Cal Planning workshops. If you are in urgent need to qualify for Medi-Cal, we invite you to contact our office to see if we can help.