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Institutional Medicaid FAQ's
  • What is Medicaid?
    Medicaid is a health insurance program that pays medical bills for eligible low-income families and individuals whose income is insufficient to meet the cost of necessary medical services. The South Carolina Medicaid program, called Healthy Connections, is administered by the South Carolina Department of Health and Human Services (SCDHHS) and pays medical bills with state and federal tax money.
  • Are Medicaid and Medicare the same?
    No. Medicaid and Medicare are two different programs. Medicare is a health insurance program for all people age 65 and over or who have received Social Security disability benefits for a minimum of 24 months. You can find out more about Medicare by visiting their website or by contacting them at 1-800-633-4227.
  • Can an individual be eligible for both Medicaid and Medicare at the same time?
    An individual can have both Medicaid and Medicare in some circumstances. If an individual receives Supplemental Security Income (SSI) from the Social Security Administration, he or she is automatically eligible for Medicaid and often receives Medicare as well. If an individual receives Medicaid and Medicare, Medicaid will usually pay their Medicare premium, co-payments, and deductibles.
  • What is Institutional Medicaid?
    Institutional Medicaid is Medicaid for an individual residing in a medical institution or nursing facility, and his/her eligibility for Medicaid sponsorship of payment depends partly upon his/her meeting the level of care criteria established by the state. An individual is considered to be institutionalized if he/she has resided in a medical institution or received home and community-based waiver services or a combination of these services for a period of 30 consecutive days. The same eligibility requirements apply for both programs. The difference is that the individual who needs nursing home care but who chooses to stay at home rather than going to an institution can receive special services through a waiver to help him/her remain in the home.
  • How much income can a person receive and still be eligible for Institutional Medicaid?
    An individual’s gross monthly income must be below the Medicaid limit. The Medicaid limit is equal to 300 percent of the current SSI Federal Benefit Rate (FBR). Effective 01/01/24, the gross income limit is $2,829.00 per month. This special income limit of $2,829.00 can be used only if an individual is institutionalized. In South Carolina, if the individual is eligible for Medicaid, except that his/her gross monthly income is greater than the Medicaid limit, he or she may establish an income trust to become eligible for Medicaid. Contact PalmettoMEC for additional information about income trust requirements.
  • How are resources defined?
    Resources are generally defined as those assets including both real and personal property that an individual owns and can use to meet basic needs of food, clothing and shelter.
  • What are the limits on the amount of assets a person may have and still be eligible for Institutional Medicaid?
    The value of resources owned by the individual cannot exceed $2,000 (after exclusions). The following resources are excluded: The value of homestead property (for applications received on or after January 1, 2006, the Deficit Reduction Act of 2005 limits the amount of the exemption for homestead property to $713,000 in equity value, unless there is a spouse, minor child, or disabled child lawfully residing in the home); The value of one automobile; The value of life estate interest in real property; The value of household goods and personal effects; The value of undivided interest in heirs property; Up to $1,500; and set aside for the individual’s burial. (An additional $1,500 for a spouse, if the cash value of life insurance policies owned by the individual when the total face value of all policies is $10,000 or less. Irrevocable Prepaid Burial Funeral Contracts
  • Are there assets that an individual may have to spend down to meet Medicaid’s eligibility requirements?
    Yes. The following assets are non-excluded and may have to be spent-down to meet the resource limit: Cash, checking and savings accounts, stocks, bonds, mutual funds, non-homestead property, other financial and investment accounts and life insurance cash values. With PalmettoMEC’s help, these assets may be preserved or converted to an excludable asset, and the applicant can still qualify for Medicaid.
  • Are there non-financial requirements that must be met for a person to be eligible for nursing home or in-home Medicaid?
    Yes. The person is required to furnish his/her Social Security Number or apply for a number; The individual must assign rights to medical benefits or support to the state and cooperate with the state in obtaining such benefits or support; The individual must apply for any other benefits for which he/she may be entitled; and , The individual must need nursing facility level of care as certified by staff of the Community Long-Term Care Program.
  • If someone has health insurance, would he/she still be eligible for Institutional Medicaid?"
    Yes. An individual may have private health insurance and still be eligible for Institutional Medicaid.
  • Does Medicaid from another state transfer to South Carolina?
    No. Medicaid is different from state to state. To qualify for full Medicaid benefits in South Carolina, a person must be a South Carolina resident and either a U.S. citizen or a legally residing non-citizen. Citizenship and Identity must be documented for anyone applying for or receiving Medicaid benefits. Applicants who receive SSI or are eligible for Medicare Part A or B do not have to provide additional information to verify citizenship and identity.
  • If a person is approved for institutional Medicaid, what other services would he/she be eligible for?"
    Once an individual is determined eligible for Medicaid, a South Carolina Healthy Connections (Medicaid) card is issued. The individual is eligible to receive all services covered by Medicaid. For the individual in the nursing facility, the Medicaid program also makes a monthly payment to the facility for his/her care.
  • How much would an institutionalized person be required to pay for nursing care?
    Unless the individual has a spouse in the community, he/she must contribute most of his/her monthly income toward the cost of the care provided by the nursing facility. To calculate the cost of care, the eligibility worker must determine the individual’s gross countable income and then deduct allowable expenses. The eligibility worker is responsible for making all of the deductions except the non-covered medical expenses. That deduction is determined by the nursing facility. Allowable deductions for nursing home patients who have not established an Income Trust include the following: • $30 – Personal Needs Allowance – if the institutionalized individual does not participate in a work therapy program. • $100 – Work Therapy Allowance – if the institutionalized individual participates in a work therapy program as a part of the plan of care; or • $2,829.00 – Waiver Allowance – for individuals participating in a HCBS waiver • The smaller of 10% or $25 for court ordered guardianship fees. • Community Spouse Income Allocation - $3,853.50 for 2024. (Refer to MPPM 304.15.02A) • Child Allocation – regardless of whether living with the community spouse (Refer to MPPM 304.15.02A.) • Home Maintenance Allowance A physician must certify the individual is expected to return home within six months. A maximum of six months is allowed. The allowance is given for actual expenses, not to exceed the maximum SSI payment level for an individual. It may be given even if someone continues to reside in the home. Examples of expenses that are allowed: Rent Utilities Basic Cable or Satellite TV service Examples of expenses that are not allowed: Premium Cable or Satellite TV services and channels Special telephone features, such as call waiting The first full calendar month following the month of admission to a hospital or nursing facility begins the six-month count. A request for the Home Maintenance Allowance can be made at any time during the six-month period. The deduction will be allowed as early as the date the individual is responsible for paying recurring income. • Health Insurance Premiums (other than Medicare) Must only be paid by or for the Medicaid beneficiary out of the beneficiary’s funds. May only be deducted the month the premium is due or the month after. Must be verified If the premium exceeds the individual’s income, the SCDHHS case manager will deduct the premium over several months. Acceptable forms of health Insurance premiums verification include the following: Premium notice Copy of cancelled check Bank statement verifying draft Protected Income Individuals receiving any VA benefits receive: the $30 personal needs allowance: Aid and Attendance (excluded income) $90 per month – reduced VA pension (excluded income) An individual is not responsible for paying toward his/her cost of care during the calendar month of admission from, or discharge to, a non-institutional living arrangement. Income is protected the month of admission to a nursing home if the individual was in a non-institutional setting (home or Community Residential Care Facility) anytime during that same month. Institutional living arrangements would be a hospital, rehabilitation center, or nursing home. If the individual goes from home to hospital to nursing home within the same month, the income would be protected since the individual was in the home during the month of admission to the nursing home. An exception is with Income Trust cases. Income is not protected in either the month of admission or the month of discharge in Income Trust cases. • The remaining income must be applied to the institutionalized individual’s cost of care (that is, recurring income). The Medicaid program then pays the difference between the individual’s income and the Medicaid allowable charge. For the individual receiving home and community-based (waiver) services, the individual is allowed to keep his/her monthly income to cover the cost of his/her living expenses unless the income exceeds the Medicaid limit and he/she has established an income trust to become eligible for Medicaid. The Medicaid program pays for the home and community-based (waiver) services the individual receives. PalmettoMEC’s specialists can explain Income Trust policy and help the applicant’s representative complete the Income Trust documents.
  • Would a penalty be applied if a Medicaid applicant has transferred assets to another person?
    A penalty may imposed if an individual has transferred property to someone else. In accordance with Section 1917 of the Social Security Act, payment for institutional services or home and community-based (waiver) services is denied for individuals who dispose of assets for less than the fair market value within a look-back period based on the date of the request for Medicaid sponsorship of such services. The penalty applies to institutionalized individuals and to individuals who receive home and community-based (waiver) services. It also applies if the spouse of the institutionalized individual transferred assets. There is no maximum penalty period. The number of months in the penalty period is calculated by dividing the uncompensated value of the transferred asset(s) by the average private pay nursing home rate. The penalty period is the later of the first day of the month the transfer occurred, or the date an individual would have become eligible for long-term care services except for the penalty period. No penalty is imposed for the transfer of a home to a: Spouse Child under age 21 or a blind or disabled child Sibling with equity interest in the home and who lived in the home at least one year before the individual’s admission to the institution Child who lived in the home of a parent(s) for at least two years before the parent was admitted to the institution and who provided care for the parent, which delayed institutionalization, or If the assets were transferred to a community, spouse, or blind or disabled child If the individual can show that he/she intended to dispose of assets at fair market value or for other consideration. This would be an individual who inadvertently did not receive adequate compensation or an individual who transferred assets to another individual in return for care, which delayed institutionalization If the individual can show that assets were transferred for some reason other than to qualify for Medicaid. For example, an individual may have been elderly or had a disabling condition at the time of transfer but did not need nursing home care. Subsequent to the transfer, the individual’s condition deteriorated so that nursing home care became necessary. This individual would not be penalized for a transfer that occurred prior to the time his/her health deteriorated; or, If the imposition of the penalty would cause an undue hardship. An undue hardship is defined as discharge by the medical facility or denial of home and community-based (waiver) services that would result in the individual being placed in a life-threatening situation.
  • Does Medicaid make financial provisions for the spouse of an individual who needs long term care?
    Yes. The Medicaid Catastrophic Coverage Act of 1988 added Section 1924 of the Social Security Act which included provisions affecting the treatment of income and resources when an individual who is in an institution (or receives home and community-based services) has a spouse remaining in the community. The following is a brief discussion of these provisions. Treatment of Income when there is an in-home spouse: Beginning October 1, 1989, institutionalized individuals who have a spouse in the community are allowed to give a greater amount of their income to the community spouse. In South Carolina, the maximum monthly income amount for the community spouse is 3,853.50. First, the institutionalized spouse must be determined eligible for Medicaid considering only his/her income. In other words, the institutionalized spouse must have gross monthly income below the $2,829.00 Medicaid Cap in order to be eligible. Second, the amount the institutionalized spouse is responsible for contributing toward the cost of his/her care (i.e. recurring income) must be established. The following deductions must be made from the institutionalized spouse’s gross income to determine the monthly recurring income. The deductions must be made in the following order: Personal needs allowance of $30. The smaller of 10% of gross monthly income or $25 per month when there is a court order requiring guardianship fees. Community spouse income allowance not to exceed $3,853.50. The community spouse is allowed to keep enough of the institutionalized spouse’s income to bring the community spouse’s monthly income up to $3,853.50, if the institutionalized spouse has that much income. An allowance for other dependent family members. The cost of medical expenses not covered by Medicaid or other third-party payers (after November 1989). Treatment of Resources when there is an in-home spouse: Beginning October 1, 1989, the community spouse of an institutionalized individual is allowed to retain a portion of the couple’s countable resources. The following steps are taken: The case manager establishes the total combined value of the couple’s countable resources. Resources like the home and surrounding land, household goods and personal effects, one automobile, funds designated for burial, etc., are not counted in this determination. Resources like non-home property, bank accounts, certificates of deposits, stocks, bonds, etc., are counted. The case manager subtracts the community spouse’s share from the couple’s total countable resources. In South Carolina, the community spouse is allowed to retain up to $66,480 in countable resources. The remainder is the institutionalized spouse’s share of resources. If this amount is below $2,000, and he/she is otherwise eligible, the institutionalized spouse is eligible for Medicaid. If this amount is equal to or above $2,000, the institutionalized spouse is not eligible for Medicaid until his/her resources are below $2,000.
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