Texas Announces Plans to Combine Medicare and Medicaid Benefits

For people who receive both Medicare and Medicaid benefits from the state of Texas, things might be getting a whole lot easier. The state of Texas just received approval from the federal government to test an idea that would combine the delivery of Medicare and Medicaid benefits to individuals enrolled in both programs.

Why the Change?

Officials say that the combination of the two services could help make it simpler for enrollees to receive their benefits while also potentially reducing costs for both the state and federal governments.

“Combining a person’s Medicaid and Medicare services into one plan makes sense for the consumer and for the taxpayer,” said Chris Traylor, chief deputy commissioner of the Texas Health and Human Services Commission. “We’ll be able to improve the coordination of care, helping people get the right care in the right setting, and we can save money for both the state and federal governments.”

Right now, Medicare pays for the covered services and then Medicaid picks up the rest of the tab afterwards. By merging the benefit services, it could help coordinate communication between the different programs and encourage better management of care that serves both programs, instead of only financially benefitting one. The new idea could help save money because combining the two services would increase the incentive to support policies that reduce the need for hospitalization, thereby cutting back on inpatient hospital stays and institutional care.

Who is Eligible?

400,000 people living in Texas are currently receiving benefits from both Medicare and Medicaid. Those people are eligible for Medicare based on either their age or disability and simultaneously eligible for Medicaid because of their income status. People enrolled in both programs are referred to as “dual eligibles”.

The program will be piloted in 6 Texas counties that include 168,000 of the dual eligible Texans. In order to enroll in the pilot program, you must be at least 21 years of age. The pilot will begin on March 1, 2015 and information will be sent out to eligible residents in January of next year.

For those who are dual eligible, the long term care expenses that Medicare doesn’t cover are picked up by Medicaid. For those who only qualify for Medicare (and therefore will not be included in this new program), it’s important to remember that despite your age, Medicare does not cover all of your health care expenses. There are many different kinds of out of pocket expenses that Medicare will not pay for, including long term care, which can be extremely expensive. Read more details about the upcoming program here.

To learn more about the cost of long term care in Texas, click here.

Just How Expensive is Long Term Care in Texas?

The cost of Long Term Care in the United States has steadily risen in the past decade. Nursing homes, assisted living facilities, and in-home care services are now more expensive than ever. Fortunately for Texans, Long Term Care costs in the Lone Star State are still significantly lower than the national averages.

The Texas Advantage

According to the 2013 Cost of Care Survey released by Genworth Financial, Texas has some of the lowest Long Term Care costs in the nation. While the national median annual cost for a private room in a nursing home is $83,950, the median cost in Texas for the same service is only $61,320. The difference of over $22,000 is a highly significant chunk  of money that could be put towards other expenses or saved for future use. Compare the cost in Texas to states like California where the median cost is just under $98,000 annually or Alaska where the median cost is a shocking $255,891, and it becomes clear that the difference in cost truly matters.

Furthermore, the national median cost for a private room in a nursing home was up 7.4% from $77,745 in 2011, but the Texas median only increased 1.8% from the 2011 median of $60,225. That indicates that in addition to lower costs overall, the cost growth rate is also lower in Texas compared to the nation as a whole.

The national and Texas medians were more similar when it came to assisted living facilities and in-home care services, but the numbers differed considerably again in regard to adult day cares. Adult day cares are non-residential facilities where caregivers can take a long term care patient for the day. These facilities incorporate health, social interaction, help with daily tasks, and therapeutic services. The national median cost for an adult day care center was $16,900 annually. In Texas, the median was almost exactly half that at $8,580 yearly.

Preparing for Long Term Care

Just because long term care services in Texas are cheaper than the rest of the country certainly doesn’t mean you shouldn’t plan to pay for them. Planning for your future long term care health needs is a vital part of retirement planning. Because Texas has one of the lowest Medicaid reimbursement rates, the state health care system is struggling to stay afloat. More than 6.3 million Texans are uninsured, meaning a lot of people will soon be turning to Medicaid for their long term health needs. This has the potential to lead to substandard quality of care within the government subsidized health programs.

The looming Medicaid crisis in Texas only encourages Long Term Care Insurance more. With LTCI, you don’t have to run the risk of compromising care for cost. An LTCI policy will safeguard your assets from depletion, while ensuring you receive the quality care you deserve. The state and private insurers worked together to create a Long Term Care Insurance Partnership program for the state, offering a variety of plans to Texas residents.

Interested in Long Term Care Insurance in Texas? Read more about Texas LTCI Partnership policies here.

Get the latest LTCI quotes from the top cities in Texas here.