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Medicaid and Health Care Reform

Although Medicaid is available to people under the age of 65, it is especially important to senior citizens. First, what is Medicaid? Medicaid is a need-based, state-run, federally-funded program that often assists seniors in paying for nursing home care after their other resources are exhausted. Medicaid also plays a major role in covering those who lack insurance. After the extensive Health Care Reform legislation in March of 2010, the Affordable Care Act, senior citizens were left wondering about its impact on the Medicaid system.


Map showing the breakdown of potential Medicaid-eligible individuals by state after health reform is enacted (courtesy of statehealthfacts.org).

Expanded Medicaid Coverage

Health Care Reform has played a role in expanding coverage through Medicaid. In the past states restricted Medicaid benefits to childless adults, but in 2014, states will be required to provide coverage to these individuals who would not otherwise qualify. Perhaps more importantly, Medicaid income limitations will be increased to cover more people. In total, it is expected that an additional 16 million people will now be covered by Medicaid.

State Medicaid Burdens

Through Health Care Reform, the federal government is expected to pay 100% of the costs for the newly covered Medicaid recipients for two years, and then they will lower the funding to approximately 90% of the costs. Opponents claim the increased burden on state resources will take its toll on their Medicaid system, both financially and with the administrative burden.

Benchmark Medicaid Benefits

The Affordable Care Act requires States to provide benchmark packages providing all "essential health benefits," which are the benefits that must be provided to people signing up for Exchange plans or coverage in the individual or small group insurance market beginning in 2014.

Unfortunately, the term "essential health benefits" remains undefined, leaving states wondering about the future costs of this expanded Medicaid Coverage.

Lawsuits over Medicaid Changes   

Twenty states are now suing the Federal government to force the repeal of the Health Care Reform Act. Not only do they question the Constitutionality of the legislation, but States are extremely concerned about the budget issues resulting from extending Medicaid to even more people than they already do.

The Bottom Line

With the expanded coverage of Medicaid, seniors may wonder if the extra costs of expanding eligibility for Medicaid will have an effect on senior's benefits such as nursing home costs and other long term care needs. It remains to be seen whether this will occur.

One thing is certain: The federal government is striving to inform seniors about their options. Over $68 million is being given to States under Health Care Reform. The purpose of these funds is to better educate senior citizens and caregivers regarding their options for long-term care, their Medicare benefits, as well as their Medicaid eligibility and benefits. All 50 states are slated to receive this funding to help educate beneficiaries on the benefits for which they are eligible.

Get Quotes from Leading Carriers Nationwide

* You may be able to get extra help to pay for your prescription drug premiums and costs. To see if you qualify for getting extra help, call:

1-800-MEDICARE (1-800-633-4227). TTY/TDD users should call 1-877-486-2048, 24 hours a day/7 days a week;

The Social Security Administration at 1-800-772-1213 between 7 a.m. and 7 p.m., Monday through Friday. TTY/TDD users should call, 1-800-325-0778; or Your State Medicaid Office


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