Medicare vs. Medicaid

Medicare and Medicaid are two completely different programs that families repeatedly confuse, often during the worst possible week — a hospital discharge — when the answer determines what they can actually afford. Medicare is federal health insurance for people 65 and older and certain younger adults with disabilities. It is age- and disability-based, not income-based. Medicaid (called by various program names in Michigan, including MI Choice for the home- and community-based waiver) is a joint state-federal program for people with limited income and assets, and the eligibility tests are strict.

Medicare pays for hospitals (Part A), doctors and outpatient care (Part B), prescription drugs (Part D), short-term skilled home health when ordered after a qualifying event, and short rehabilitation stays in skilled nursing facilities (typically capped at 100 days per benefit period with cost-sharing after day 20). What Medicare does NOT pay for is the thing most families discover they need: ongoing non-medical home care, long-term assisted living, or custodial nursing-facility care once the rehab period ends.

Medicaid is the program that funds long-term care in the United States, both at home (through HCBS waivers like Michigan's MI Choice) and in nursing facilities (through standard institutional Medicaid). Eligibility requires meeting both medical criteria (nursing-facility level of care for the long-term-care portion) and financial criteria (Michigan's income and asset thresholds, which are strict and include a five-year lookback on asset transfers).

In Southeast Michigan, this distinction shapes how most families pay for home care. Medicare's short-term skilled home health visit (a nurse changing a wound dressing, a physical therapist working on post-surgery mobility) typically lasts a few weeks after a hospital stay and ends. Ongoing personal care — bathing, dressing, transfers, meal prep, supervision — is paid privately ($29–$37/hr through an agency), through long-term care insurance, through VA Aid & Attendance for eligible veterans, or through MI Choice for those who qualify financially.

Operationally, the Medicare and Medicaid systems can overlap. A Medicare-certified home health agency may visit the home for skilled nursing or therapy at the same time a non-medical home care agency provides hands-on personal care for the long-running daily needs. The two teams coordinate but bill separately and report to different payers.

The honest limit: most home care families in Southeast Michigan pay privately or through private long-term care insurance for the bulk of their care, with Medicaid coming into play after assets are spent down or for those who already qualify financially when the need arises. We tell families this directly during the assessment so they can plan rather than discover the gap after a hospital discharge.