In New Jersey, long-term care in a nursing homes is prohibitively expensive for most residents. In 2011, the average daily cost of a private room in a nursing home in New Jersey was $316. Health insurance and Medicare don't cover long term care, and few people purchase long-term care insurance. That's leaves Medicaid. Medicaid is a very common source of funding for long-term care in New Jersey, particularly when people have already used up all of their own assets to pay for care. In fact, most long-term nursing home residents use Medicaid to pay for their nursing home care.
There are many different ways to become eligible for Medicaid, and there are specific eligibility rules for long-term care services like nursing homes, assisted living facilities, and home health care services. We'll go over eligibility rules for nursing homes below. (Also read Nolo's article on when New Jersey Medicaid will pay for assisted living or home health care.)
New Jerseyans who are 65 or older (or disabled or blind) can qualify for Medicaid if they meet certain income and asset limits. If you receive SSI, you already qualify to receive Medicaid in New Jersey. But if you are elderly, blind, or disabled and not receiving SSI, then your monthly income in 2014 must be less than $931 per month (for an individual).
There is a higher income limit for seniors (and disabled or blind folks) who need assisted living or home health services. If you are 65 or older, blind, or disabled, you can qualify for Medicaid long-term care services as long as your monthly income is no more than 300% of the Supplemental Security Income amount for an individual, or $2,163 per month for 2014. The limit for a couple is $4,326 per month.
If your income is above the limit, you still might be able to qualify for Medicaid if you have a lot of medical expenses. With New Jersey’s Medically Needy Program, you can use medical bills that you incur each month to “spend down” your income and qualify for Medicaid. The Medically Needy spend-down income limit is $367 per month for an individual in 2014. If you have a household of two people, the income limit is $434 per month. You must show that you have incurred medical expenses each month that would leave you with no more than those amounts. You do not actually have to pay the bills, just receive them. Because nursing homes are so expensive, it can be easy for nursing home residents to qualify for the Medically Needy program -- their nursing home bills help them spend down their income.
The Medically Needy Program determines eligibility over a period of six months. For example, if you are living alone and have $650 per month in income, then you are $283 per month over the income limit ($650 - $367 = $283). You must show medical expenses of $1,698 within a six-month period ($283 per month x 6 months) to qualify for the Medically Needy Program. You do not have to wait for the end of six months to qualify, though. If you incur a $2,000 medical bill in the first month, for example, then you would qualify for the program.
You must have few resources (assets like money and property) in order to qualify financially for Medicaid. In New Jersey, the amount of resources you are allowed to have varies depending on your income. If your income is less than $931 per month, you can have up to $4,000 in resources and still qualify for Medicaid. A couple can have $6,000 in assets at this income level.
If your income is between $931 and $2,163 per month, the resource limit for an individual is $2,000, or $3,000 for a couple.
People who qualify for the Medically Needy Program are also allowed $4,000 in resources, or $6,000 for a couple. Keep in mind that if you are entering a nursing home and your spouse is not, you will be allowed to keep extra income and resources to support your spouse, according to New Jersey's "community spouse allowance" rules.
Not all property counts toward the resource limit. In New Jersey, your home is an exempt resource as long as it is your principal residence. But when you live away from your home for six months (for example, in a nursing home), it is presumed to not be your principal residence anymore -- unless your spouse still lives there. Also, one car is exempt regardless of its value, as long as you or a family member use it for transportation.
In addition to only paying for those with low income and assets, Medicaid will pay for a nursing home only when it is medically necessary. You must show that you need a “nursing home level of care,” meaning that you have a physical or mental condition that requires nursing supervision and assistance with several activities of daily living (ADLs) like bathing, dressing, toilet use, transfer, locomotion, and eating. In other words, you must show that you cannot care for yourself.
Before Medicaid will pay for nursing home care, you must have a "pre-admission screening." In New Jersey, pre-admission screening is done by teams from one of three Long-Term Care Field Offices for the Office of Community Choice Options. Screenings are usually done by nurses or social workers who visit you wherever you are living when you apply for help. The screener asks you questions to determine whether you need help with your ADLs.
Medicaid uses the information in your screening to decide whether you need a nursing home and, if so, what kind of nursing home is appropriate for you. Medicaid also assesses whether you could stay in your home or in a community-based setting if you got supportive services. In general, for a nursing home to be considered medically necessary, you must have a medical condition that is so serious that you need the level of nursing care that is only available in an institution.
Read on to find out if and when New Jersey Medicaid will pay for assisted living facilities or home health care.
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