Many individuals do not think about how the Medicaid program affects older adults. Rather, Medicare and Social Security are at the top of the list. While these programs support seniors, Medicaid also plays a crucial role, particularly in light of ongoing discussions regarding potential reductions to the program.
Key Facts About Medicaid and Seniors
- 50%of individuals over the age of 75 and two-thirds of those over 85 are on Medicaid.
- 60% of all nursing home residents receive care funded by Medicaid.
- Nationally, and in most states, over half of Medicaid expenditures are allocated to older adults and individuals with disabilities, amounting to $339 billion in 2021.
While Medicare provides health insurance for most seniors and Social Security serves as vital income support, Medicare does not support long-term care services such as nursing homes or in-home assistance.
For low-income individuals, Medicaid is often the only available source of funding for long-term care. Depending on each state’s Medicaid plan, covered services may include:
- Adult day care and adult day health
- Personal care assistance, at home and in assisted living facilities
- Medical and nonmedical transportation
- Respite care to give primary caregivers a break
- Congregate meals and meal delivery
- Home health aide and skilled nursing
- Home modifications such as widening of doorways, installation of ramps and addition of pedestal sinks to allow wheelchair access
- Personal emergency response systems
- Housekeeping and chore services
- Companion services
- Transition services from nursing home and back to home
- Therapies such as physical, occupational and speech
- Medication administration
Policy Considerations
As discussions continue regarding cost-saving measures in Medicare, Social Security and Medicaid, it is important to recognize the potential consequences for seniors. Key factors to consider include:
- State Medicaid programs often support hospitals and nursing homes through provider assessment — the process that “taxes” the provider to draw down federal funds.
- Slight changes in federal matching rates can create a significant budget shortfall for a state. For example, in North Carolina, a percentage drop in federal matching funds equates to a $200 million reduction in federal receipts.
If states are required to significantly reduce Medicaid budgets, seniors will likely feel the adverse effects.
Since Medicaid operates as a federal-state partnership, the specific impacts on seniors will vary by state. Despite state differences, Medicaid remains a critical safety net for seniors.
