Application Process for Aged, Blind or Disabled (ABD) / Regular Medicaid

Summary
In addition to nursing home Medicaid and HCBS Waivers, there is also the option for people who are older, blind, have a chronic illness, or are disabled to receive long term care through the state’s regular Medicaid program, which for this particular demographic is called Aged, Blind, and Disabled (ABD) Medicaid. ABD Medicaid is an entitlement, which means anyone who is eligible and must be provided with benefits (there are no waitlists). The application process is similar to other types of Medicaid Long Term Care in that applicants are assessed to meet the financial limits, but differs in that there are no functional need requirements.

 

Step 1: Investigate Regular / ABD Medicaid Long Term Benefits in Your State

Before beginning the Medicaid application process for yourself or a loved one, you’ll want to spend some time familiarizing yourself with the benefits available through Medicaid in your state. Someone who does not wish to reside in a nursing home, but whose age or disability requires a nursing home level of care (NHLOC), will want to look into Medicaid’s Home and Community Based Services waivers, which pay for help with activities of daily living (like eating and dressing), as well as meals, homemaker services, and more. A major issue with these waivers, however, is that they are not an entitlement, so after a certain number of them have been granted by the state, everyone who applies is put onto a waitlist.

Aged, Blind, and Disabled Medicaid, on the other hand, is an entitlement so there are no waitlists for eligible applicants to receive services. Though the specific benefits vary by state, a recipient of ABD Medicaid, also called Regular Medicaid, is likely to receive these benefits:

– Case management
– Help with activities of daily living (ADLs) like bathing, eating, dressing, and more
– Meal preparation or delivery
– Some housekeeping
– Transportation to doctor appointments
– Medication management
– Medical equipment

Someone in need of these benefits might have more luck applying for ABD Medicaid than specific Medicaid waivers for a number of reasons, including the difference in functional eligibility. Specifically, applicants for ABD Medicaid do not need to require a nursing home level of care (NHLOC) to receive benefits, whereas with waivers this is often a requirement.

 

Step 2: Gather Eligibility Criteria for Aged, Blind and Disabled Medicaid

The process of determining eligibility for Aged, Blind and Disabled Medicaid (also called “Regular Medicaid”) can be complex, especially considering there is a lot of variability from state to state. However, unlike Nursing Home Medicaid or Medicaid Waivers, ABD Medicaid does not have a medical need requirement to enroll in the program. Very basically, someone is eligible for ABD Medicaid if they are financially eligible, meaning their income and assets are below a certain amount.

Eligibility requirements vary from state to state, by year and with the marital status of the applicant. A simple way to find your specific eligibility requirements is to use our Medicaid Eligibility Requirements Finder tool.

General Financial Criteria
Income and asset limits vary by state, and how they are counted is complicated and also changes from state to state. Importantly, income limits for regular or ABD Medicaid are often lower than for HCBS Medicaid waivers and Nursing Home Medicaid. The income limit for ABD Medicaid in most states in 2022 is $841 per month or $1,133 per month, depending on marital status and where the applicant lives. The asset limit is generally $2,000 in 2022. Again, how these limits, especially the asset limits, are calculated can be complex. For more, see below.

Someone whose assets are valued above the Medicaid limit can still receive Aged, Blind, and Disabled Medicaid benefits if they take certain measures described below in Step 4b: Applicant is Financially Ineligible.

 Medicaid is not Medicare – Both are government-run health insurance programs, but Medicare is for all Americans 65 and older while Medicaid is for Americans with limited financial means. Often, however, Medicaid and Medicare can be combined to cover healthcare costs for applicants who are eligible for both.

 

Step 3: Assess Financial Eligibility for Aged, Blind and Disabled Medicaid

Demonstrating that one is financially eligible requires two steps: assessing income and assessing assets. This can be a complicated process and, again, the specific requirements will be different depending on which state the applicant lives in.

Assessing Income
The applicant or their family members will need to provide the state Medicaid offices with information that proves financial eligibility for ABD Medicaid. This can be a time-consuming process, but getting it right the first time is important because appealing a denial is even worse. (Help is available from Medicaid planners, an option explained further below.)

Demonstrating income for Medicaid applicants will require some or all of the following documents:
– Up-to-date pay stubs
– Benefit verification letter for Social Security, Supplemental Security Income (SSI), retirement, disability, or Medicare
– Pension statement
– Alimony checks
– Dividend checks
– Signed letters from family members who provide financial support
– Income tax return

Remember, exactly which documents are needed to prove income will vary depending on the state and the individual, but these official verifications will be necessary. If you cannot provide the documents described above, another option is to contact your local Medicaid office and ask for a Self-Declaration of Income form.

Applicants for ABD Medicaid who are married must combine incomes with their spouse when applying, which is different from applying for other Medicaid Long Term Care programs (Nursing Home Medicaid and Home and Community Based Services waivers) which do not require spouses to combine incomes. Whereas applicants for Nursing Home Medicaid or HCBS waivers may sometimes transfer money to their spouse in order to get under limits, this is not an option when applying for ABD Medicaid.

Assessing Assets
Assessing assets for a Medicaid application is almost always more difficult than assessing income, because so much nuance comes into play when determining the difference between which assets are countable and which are exempt. State Medicaid offices do not consider exempt assets when deciding whether to approve someone for ABD Medicaid.

Countable assets are “liquid,” meaning they may be turned to cash in a short amount of time. Countable assets include money in one’s bank account, stocks, bonds, and CDs or certificates of deposit. Vacation properties are also considered countable assets.

Exempt assets which will not affect eligibility include one’s primary home, vehicles, clothes, furniture, appliances, and funeral or burial trusts. Low-value life insurance policies can also be considered exempt assets by Medicaid offices.

Demonstrating the value of assets will require documentation including some or all of the following:
– Statements from checking, credit union, savings, and CD accounts
– Life insurance policies
– Appraisals and deeds of the home and any other properties
– Copies of stocks and bonds
– Copies of 401(k) accounts, annuities, and IRAs
– Receipts for prepaid funerals and deeds for burial plots

After you’ve gathered these materials, the next step depends on whether or not the documents demonstrate that the applicant is financially eligible.

 

Step 4a: Applicant is Financially Eligible for Aged, Blind and Disabled Medicaid

If you determine the applicant is financially eligible, proceed to Step 5a.

Step 5a: Have a Professional, Informal Eligibility Assessment

Demonstrating that an applicant is eligible for Aged, Blind, and Disabled Medicaid can be complicated no matter which state you live in, so it’s usually a good idea to confirm eligibility before submitting an application to the local Medicaid office (click here to find your local Medicaid office). It’s easy to make mistakes on the application, and mistakes will probably result in a denial. Applying correctly for Medicaid the first time is much easier than appealing a denial.

One possible source for confirmation of Medicaid eligibility is a benefits counselor at your nearest Area Agency on Aging. AAA offices offer free help with issues that affect older Americans, including applying for benefits programs like Medicaid, and they will be experts on the specific requirements in your state. A possible problem with AAA offices is that they can be very busy, and might not help as quickly as you’d like. To find your local AAA office, click here.

Another way to confirm ABD Medicaid eligibility is through a Certified Medicaid Planner. These are paid services, unlike help from AAA offices, but Medicaid planners often provide the first consultation for free so you can decide if their help is right for your specific situation. To find a Medicaid planner near you, click here.

 

Step 4b: Applicant is Financially Ineligible for Aged, Blind and Disabled Medicaid

Just because one’s income and/or assets are above the Medicaid limits does not necessarily mean they cannot get Medicaid. For applicants over the eligibility limits, a few options are available that will make it likely Medicaid still approves the benefits.

 

Step 5b: Investigate Alternate Pathways to Eligibility

Medically Needy Medicaid
Medically Needy Medicaid is a program available in 36 states and Washington, D.C., that will provide Medicaid benefits to people who are over the income limits if they spend large amounts of their money on medical care. Another way of saying it is that Medically Needy Medicaid is available for people who spend a high percentage of their income on healthcare, even if they are above the income limit. The applicant’s state Medicaid office will look at their finances over a period of time, perhaps as much as 6 months, and compare the money earned to the amount spent on care. Someone who spends what might be considered an unreasonable amount of their income on health-related services or equipment would be approved for Aged, Blind and Disabled Medicaid even if they’re above the limit.

Miller Trusts or Qualified Income Trusts
Miller Trusts and Qualified Income Trusts (QITs) have a lot of nuance and can be complex, but they are basically special accounts where an applicant deposits the money that puts them above the Medicaid asset limit. Any money placed in a Miller Trust or QIT does not count toward eligibility, under the conditions that those funds are managed by someone other than the applicant and may only be spent on healthcare costs that Medicaid benefits do not cover. It’s important to note that Miller Trusts and QITs are not an option in every state.

Look Back Periods and “Spending Down”
If one is over the asset limit for Aged, Blind and Disabled Medicaid, but would otherwise be eligible, there is the option to “spend down” their assets to get under the limit. Of course, there are rules and they can get a little complicated. Spending down does not mean dumping money as fast as possible to reduce the amount of the applicant’s assets, because states have look back periods allowing Medicaid officials to review bank accounts and other finances over a set amount of time. Look back periods are usually five years.

Some of the options that are usually allowed for spending down assets include:
– Purchasing an irrevocable funeral expense trust
– Medicaid compliant annuities
– Transferring ownership of property (usually through ladybird deeds or enhanced life estate deeds)
– Medicaid Asset Protection Trusts
– “Half a loaf” gifting strategies

These are general strategies for spending down, but the specific rules can have significant variance depending on the state. There can be so much complexity, in fact, that someone who’s finances put them above the income or asset limits should probably pay for the assistance of a Medicaid planner.

Medicaid Planning
Certified Medicaid Planners are experts at figuring out whether a person’s income and/or assets are disqualifying for Medicaid benefits, and will advise strategies like those described above for getting under the limits so the application will be approved. People who benefit from Medicaid planning in particular are those who have a complicated marriage situation or assets that are much higher than the state limit.

Elder law attorneys are also experts at fixing problems with income or assets that might be preventing an otherwise qualified applicant from being approved. Elder law attorneys can establish the accounts and trusts for getting an applicant under the income or asset limits. These services can be expensive, unfortunately, costing hundreds of dollars per hour. But for the right applicant, Medicaid planning is absolutely worth it because they are incentivized to get the application approved, and the cost of planning is likely still a lot lower than paying for medical care without Medicaid.

 

Step 6: Complete and Submit the Application for Aged, Blind and Disabled Medicaid

There are so many different types of Medicaid that you will need to spend some time making sure you have the right application for the specific “eligibility group” you want to apply under, which is Aged, Blind and Disabled Medicaid in this case, or Regular Medicaid. Contact your nearest Medicaid office at this link, and ask specifically for the correct application (or where to find it online).

You can submit an application three ways: in person, by mail, or online. Most applicants are advised to apply online at their state’s Medicaid website, because these applications are processed faster than those submitted in person or through the mail.

 

Step 7: Awaiting Approval for Aged, Blind and Disabled Medicaid

By law, it is supposed to take 90 days or fewer for an application for Medicaid to be processed and for the applicant to receive a determination letter that says whether or not they are approved. Unfortunately, it might take longer because there is not a means of enforcing this limit and frustrated applicants in various states have found that it does take longer than the 90 days to receive their determination letter. The time between applying and receiving an approval or denial of benefits is called “Medicaid pending.”