Medicaid, jointly funded by the federal government and individual states, is arguably the most important public benefit available to individuals with disabilities. While eligibility guidelines, services and payment rates vary widely, the federal government requires that all state Medicaid programs pay for physician visits, prescriptions, hospitalization, lab work, x-rays and nursing home care. In addition, all states must provide periodic health screenings and treatment to Medicaid-covered children under the age of six.
Although Medicaid is available only to those having limited income and assets, once an individual with disabilities reaches the age of 18, family assets are no longer considered, making it an important consideration in all special needs estate planning.
In addition, most states have established Medicaid “waiver” programs with less stringent income/asset requirements. The most common of these are intended to support the needs of individuals with severe disabilities who are eligible for long-term, institutionalized care, but whose families prefer that they remain in a community setting. Typical services include home aides, day habilitation, family respite and therapeutic services. Some states will cover expenses for individuals to live in small, community-based group homes.
Waiver waiting lists are notoriously long, and it can take years for an individual to obtain services. Parents should, therefore, place their child on appropriate waiver lists as early as possible.
The current tone of the budget discussions taking place at all levels of government poses a serious threat to Medicaid in general. It appears inevitable that services will be trimmed and that waiver lists will continue to grow. This is ironic, since community-based care is more economical than the institutional living which is its alternative.
This troubling situation underlines the importance of early family planning for the financial security of loved ones with disabilities. Establishing a third party special needs trust (SNT) to which family and friends can contribute funds without endangering a child’s eligibility for government programs is a means of supplementing bare-necessity services that are likely to be even more modest in the future.