Benefit Bulletin: March 2014

Benefit Bulletin: March 2014

Obamacare Medicaid Expansion Creates New Inequities For Seniors

Medicaid, the state and federal program that provides healthcare for low-income Americans, is undergoing a massive expansion with the start of the Affordable Care Act (Obamacare).  The fairness of that expansion for seniors is drawing closer scrutiny from TSCL.

New eligibility rules make it considerably easier for millions of applicants, including seniors under the age of 65, who are too young for Medicare, to qualify for the program.  But older seniors continue to have much more restrictive and stringent asset and savings tests to satisfy before they qualify for Medicaid, because the new rules don't apply to seniors age 65 and older.  This sets up inequities in benefits between seniors like Notch Babies who are in their late 80s and 90s and who are more likely to be receiving long-term care, and other people younger than 65 who will benefit from the less stringent Medicaid qualification rules.

The inequities don't stop at the different eligibility rules. The new Medicaid benefits aren't available in every state.  In 25 states and Washington D.C., Medicaid will for the first time be open to anyone younger than age 65 whose income is no more than 133% of the federal poverty level, $15,856 a year (individual).  But people living in one of the twenty-five states that have decided not to expand their Medicaid programs will be left out.  Younger seniors in those states aren't receiving the same benefit opportunities because the Supreme Court ruled that Obamacare could not compel states to expand their Medicaid programs.

Medicaid currently covers about 60 percent of people in nursing homes.  But to qualify, seniors in long-term care are required to "spend down" their life savings to the last $2,000 (individuals) and $4,000 (couples) before Medicaid covers the bill.   That won't apply to people younger than 65 under the new rules.  Financial eligibility is based on modified adjusted gross income.  Medicaid will no longer count how much applicants have in assets like savings and investments for this group of applicants as long as they aren't in long-term care.  While that's likely to help more low-income seniors under 65 qualify for Medicaid, TSCL is concerned that it also opens the program to greater potential for gaming the system and fraud.

We are interested in hearing from our readers to learn what you think about the new Medicaid expansion.  Are you benefiting from the new rules?  Should there be tighter asset restrictions?  Send us an email at


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