There are two forms of government health insurance:
– Medicare. Basically, age-based insurance for older adults (age 65+), regardless of income and assets. (Assets include money and belongings, such as a house or car.)
– Medicaid. Income-based insurance funded with federal and state dollars. (The state where your relative lives may have a name different than “Medicaid.”) This insurance is for individuals who have very little means. The financial asset threshold is often set at $2000 or less.
Medicaid will sometimes pay when Medicare will not.
The most common expense covered by Medicaid is long-term care in a nursing home. Speaking very generally, Medicare pays for the first 100 days after a hospitalization. If a person needs to stay longer—permanently move into the facility—they must cover the cost from their own savings. Once nearly all their resources have been exhausted, they can apply for Medicaid, which will pick up the tab.