Summary
Retroactive Medicaid will pay for nursing home care for up to 3 months prior to the date of one’s application. That means that if you or your loved one has a sudden need for full-time care you can move into a nursing home before applying for Medicaid, and Nursing Home Medicaid will pay expenses up to three months before the application was submitted, as long as you would have been eligible during that time. Retroactive Medicaid eligibility does not apply to HCBS Waivers or ABD Medicaid.
Medicaid Long Term Care is for people who are older or have a chronic illness and are considered financially limited in their state of residence. For financially needy seniors who require a Nursing Facility Level of Care, which means they need the kind of full-time care and supervision that is normally associated with a nursing home, Medicaid Long Term Care will cover all nursing home expenses, including room and board.
But what if a financially limited senior has to move into a nursing home or begins getting medical bills before applying for Medicaid benefits? Retroactive Medicaid eligibility is meant to work like a safety net that will retroactively pay for the medical and personal care expenses that came in during the months before applying for Medicaid.
The complicated standards involving income and assets make it a time-consuming process to apply for Medicaid, and sometimes care needs can come on too quickly. Retroactive eligibility helps someone going through this process know that even if bills are piling up, the program can pay them when it finally kicks in.
Step-by-Step: To get advice on the basics of applying for Nursing Home Medicaid with a simple, step-by-step guide, click here.
Retroactive eligibility is often useful for people who receive Nursing Home Care through their state’s Medicaid program. A sudden change in condition or unexpected move into a nursing home can be incredibly difficult and expensive (usually more than $7,000 per month), and Medicaid’s retroactive eligibility makes the move easier.
With retroactive eligibility, someone in the process of applying for Nursing Home Medicaid doesn’t need to stress about bills piling up before they can complete the application. In other words, if one has to unexpectedly move into a nursing home and finds they cannot afford the cost, retroactive eligibility makes it possible to move into a nursing home and get those bills paid retroactively by the state’s Medicaid program. Medicaid will cover unpaid bills going back three months via retroactive eligibility, and in some states it will cover paid bills, meaning the eligible applicant is reimbursed.
Because income and asset limits come into play, one who has assets above the state’s limits might spend those savings on the cost of long-term care, and if they run out of money to cover bills and then apply for Medicaid, the program will retroactively cover bills accrued during the process of applying. In other words, someone paying privately for care in a nursing home might become eligible for Medicaid later in their stay, and retroactive eligibility can keep them covered during that gap between running out of personal finances and being accepted by state Medicaid (as long as it’s 3 months or less).
Important: Retroactive Medicaid may cover the cost of nursing home care for 90 days prior, but it may be difficult to find a nursing home that will allow an individual to move in while they are “Medicaid pending” with the hope that they will be approved by Medicaid, and the nursing home will be reimbursed. Often, families must pay out-of-pocket and hope for reimbursement.
While retroactive eligibility and coverage applies Nursing Home Medicaid in all 50 states and the District of Columbia, retroactive eligibility does not apply to Home and Community Based Services (HCBS) Waivers or long-term care services via Aged, Blind and Disabled (ABD) Medicaid.
Some states may allow for retroactive eligibility when it comes to regular (non long-term care) medical coverage via ABD Medicaid, but the focus of this article is on long-term care. To see if your state provides any Retroactive Eligibility coverage outside of Nursing Home Medicaid, check with your state Medicaid offices.
Being eligible for Nursing Home Medicaid requires income and assets below a certain amount. In most states, this means that one’s monthly income must be below $2,829/month (as of 2024), and their countable assets (bank accounts, CDs, stocks, IRAs, real estate and anything that can be easily converted to cash) are below $2,000. Remember, however, that these numbers can vary depending on one’s marriage status, state of residence, and many other factors. For state-specific Medicaid Long Term Care eligibility requirements, click here.
In order to be retroactively eligible, someone must meet these financial criteria up to three months prior to actually applying. They must also meet the functional or medical criteria for Nursing Home Medicaid, which is requiring a Nursing Facility Level of Care (NFLOC).
NFLOC requirements and measuring methods can also vary from state to state. In general, most states will arrange for an in-person evaluation by a qualified healthcare professional using a standardized assessment procedure. The assessments will, again in general, determine the applicant’s ability to perform the Activities of Daily Living: mobility (moving from room to room, or in and out of bed), bathing, dressing, eating and toileting. In some states, needing help with 2 of the 5 Activities of Daily Living equals a NFLOC, in other states it’s needing help with 3 of the 5.
Most states will also consult with the applicant’s physician, and assess mental and behavioral issues, as well.
Attention: If a senior dies with unpaid medical bills, it is possible to file for retroactive eligibility on their behalf if they met the state’s criteria for Medicaid.
Using Retroactive Medicaid to cover the bills from the months before applying for Medicaid will depend on the state. Every state has a different method for approving Medicaid Long Term Care benefits; retroactive eligibility may be as simple as checking a box on the form, or it might require filing a completely separate document.
To be approved for Retroactive Medicaid eligibility and coverage, an applicant will need to provide documented proof that they were eligible for Medicaid (based on state criteria) during the period before applying. Functional and financial need might both require bank statements and doctors’ notes, but again it depends on the state.
If you need Medicaid long term care but do not meet the financial eligibility criteria, consider working with a Medicaid Planning professional. These fee-based experts help families structure their finances to become eligible, while streamlining the application process and preserving assets for spouses and family members.
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