Navigating the Maze: Understanding Medicare, MassHealth, and Medicaid
Healthcare can be confusing, especially when it comes to government programs. Medicare, Medicaid, and MassHealth are three of the most common, but they serve different purposes and have distinct rules. This guide will help you understand the differences and what they cover.
What is Medicare?
Medicare is a federal health insurance program primarily for people who are 65 or older. It also covers certain younger individuals with disabilities and those with End-Stage Renal Disease. Private companies and insurance providers, approved by Medicare, offer these plans.
- Medicare Part A (Hospital Insurance): This covers inpatient hospital stays, care in a skilled nursing facility, hospice care, and some home health services.
- Medicare Part B (Medical Insurance): This part covers doctor visits, outpatient care, medical supplies, and preventive services.
- Medicare Part D (Prescription Drug Coverage): This is an optional plan that helps cover the cost of prescription drugs.
- Medicare Advantage (Part C): This is an “all-in-one” alternative to Original Medicare. These bundled plans include Part A, Part B, and usually Part D.
- Medicare Supplement (Medigap): This coverage helps fill gaps in Original Medicare, such as deductibles, coinsurance, and copayments.
MassHealth vs. Medicaid
Medicaid is a joint federal and state assistance program that provides health coverage to low-income adults, children, pregnant women, elderly adults, and people with disabilities. In Massachusetts, this program is called MassHealth. While the name is different, the core purpose is the same. To qualify for MassHealth, your income and assets must fall below specific eligibility limits. There are also rules about transferring assets that you need to be aware of.
Long-Term Care: The Critical Difference
The distinction between Medicare and MassHealth becomes crucial when long-term nursing facility care is needed.
- If you have a sudden illness, Medicare will pay for a stay in a hospital or skilled nursing facility for up to 60 days after you meet your deductible. You may be able to extend this for an additional 30 days with a daily coinsurance payment.
- However, if your need for care is long-term or indefinite, you will be expected to pay for it out-of-pocket once your Medicare benefits are exhausted.
This is where MassHealth becomes essential. If you qualify, MassHealth can cover the costs of extended long-term care.
Planning for Long-Term Care
The Heritage Law Center specializes in helping families plan for the possibility of an extended stay in a long-term care facility. We often use trusts to help clients qualify for MassHealth. This ensures that you won’t be forced to spend all your assets on a nursing home, allowing you to protect your legacy and avoid nursing home poverty.
If you are interested in learning more about trusts and how they can help you with MassHealth planning, please contact us for a free, initial consultation.
