Medicaid and private insurance?

(putting in GQ since I think there are factual answers to be had)

So Moon Unit is living in another state right now (at a therapeutic residential facility).

They encouraged her to apply for Medicaid as of this year. She has zero income, of course, though she’s looking for a part-time job up there. It would still be well under the federal poverty limit. I assume this means we can’t take her as a dependent this coming year, which will be annoying as the facility is spending enough that we’re likely to be able to itemize.

She was just approved, retroactive to January 1. She called me to tell me we had to drop her from our insurance.

  1. I am not sure we can; I have to research whether this is a life event. Anyone know offhand?

  2. Everything I can find online says that (while it may vary by state), you can have both private insurance and Medicaid. The state she is in says “I am eligible for Medicaid; do I have to take my employer’s insurance coverage?
    No, if you are eligible for Medicaid, you do not have to take your employer’s insurance. Alternatively, if you want to have both Medicaid and your employer’s coverage, you may.”.

Weirdly, I think this move (which she’s entitled to make; she’s a legal adult) will cost us money:

  1. can’t deduct her as a dependent
  2. can’t itemize her residential treatment expenses (which we’ll continue to pay, of course)
  3. Less medical expenses going into our out of pocket limit for insurance - had we known, we might have taken a different plan this year.

Does dropping her off insurance disqualify her as a dependent in all ways? It seems to me that there must be plenty of people whose dependents for various reasons are not on their health plan. Plus, paying for a lot of her stuff seems to be the essence of what it means to be a dependent in income tax parlance.

Are you sure she’s not still a dependent? You’re paying for her facility, that should qualify one would think!

If she is to qualify for Medicaid she would need to stop being a dependent or else she has to qualify with your income and assets. Can’t have it both ways. Also, state by state Medicaid laws differ but you may not be able to drop her as a dependent if she is below a certain age regardless of her wishes or location of residency.

If she is being covered under your insurance I’m not sure what the benefit of her moving to Medicaid would be unless you are fielding significant out of pocket costs that would go away once she is no longer your financial responsibility and Medicare was paying for everything. That would be the only point of putting her on Medicaid to begin with.

The “dependent” thing is independent (hah) of the insurance question; our 24 year old son is on our health insurance and we haven’t claimed him in several years; for a while there he didn’t qualify, as he earned too much and was not a full time student.

Also, just because you can claim someone as a dependent, doesn’t mean you must; we had a deal with our son where we compared the net tax bill if we claimed him (and he filed without taking his own deduction) versus if we did not, and he took his own personal deduction. In any case, she’s nearly 22, so I don’t think there’d be any requirement to maintain her as our legal dependent.

She’s living in a facility in a state 500 miles away. I think she wanted to go on Medicaid because supposedly the therapy options are better in that town if you’re on Medicaid (I can speak from her prior experience; it’s tough to find an “in-network” therapist of any kind).

I’m sure she wouldn’t qualify for Medicaid unless she is treated as independent for all financial reasons. That also opens up some options regarding other assistance (career training and placement, Job Corps etc.). I’m actually a little surprised she could get Medicaid as a resident of the other state, since she hasn’t quite been there a full year, doesn’t have a driver’s license there, etc., but obviously I don’t know the rules and there are variations from state to state.

So when she said she wanted to apply for Medicaid up there, I admit the financial ramifications did not occur to me. The health insurance is minor - it doesn’t cost much more (any more at all perhaps?) to insure 2 kids vs 1. Maybe our out of pocket medical costs would be lower if Medicaid picks up some of the difference. The loss of the medical deduction (the fees at this place are steep as hell) will be somewhat painful - but if we’d spent that money on college for her little of it would have been deductible anyway.

But getting back to the GQ portion of the post: has anyone ever heard yay or nay to keeping private insurance while on Medicaid? The facility says “nuh-uh, can’t do it” while the state’s website suggests it’s permitted.

My adult disabled daughter (29 years old, incapable of self-support) is in a group home in Pennsylvania. She is covered by both Medicaid and by my insurance through work (adults whose disability started as children can remain on their parent’s insurance indefinitely, at least at my current and my previous employers).

We do not claim her as a dependent - to claim a dependent you need to provide at least 50% of their living expenses.

The way it works is my insurance is primary; claims are submitted there first. Remaining balance is covered by Medicaid, whether it is co-pay, deductible, or rejected claims. She generally ends up with zero out-of-pocket.

It is possible that they wanted her to qualify her for medicaid so they can milk it. Not saying it’s the case but I’ve heard of some people who got stuck in mental health facilities and had a very hard time leaving once they got them to sign up for medicaid.

My own personal experience was that most dually-insured people were divorced moms who were income-eligible for Medicaid, and their ex had to provide private health insurance for the kids as part of the child support package. The grocery store’s computer system wasn’t set up to run claims through more than one insurance, so we just submitted prescriptions to Medicaid, and they were almost always covered. If they weren’t, we ran them through the private insurance and gave them the receipt for Medicaid reimbursement, or reimbursement by the ex.

Mama Zappa, the facility’s social worker should be able to explain the best way to do it for you. They’ve encountered this many times before.

Another question: would Medicaid cover her residential treatment expenses? Medicaid does cover things that private insurance will not, like nursing homes. She might also qualify for so-called Medicaid waiver services, depending on the exact condition that is requiring residential treatment.

Have you looked into whether she qualifies for SSI (or had worked long enough for regular SS disability)? Hard to make meaningful suggestions without knowing what her condition is, if the treatment is short-term or indefinite, etc.

In my case my daughter is a dual diagnosis of autism/MR, so a pretty wide range of services are available to her (once you fight to get them) and are expected to be needed for her lifetime.

Pharmacy Benefit Managers (PBMs) do not coordinate benefits for RX claims like what happens with insurance companies for medical claims, so if there’s multiple insurances involved the prescription runs through whichever card the subscriber happens to show.

So, I see some things haven’t changed in the 15 years since I worked at the grocery store.

For the last few years of her life, my grandmother was on both Medicare and Medicaid. Medicare was the primary payer, and Medicaid picked up the rest (like her nursing home bill).

Call or email the state’s Medicaid office - because that statement is not clear. It doesn’t specifically say you can have Medicaid and be covered under your parent’s employer’s health insurance. Even aside from that, I saw a number of websites referring to different states where you could have both , but Medicaid would essentially just help pay the premiums on the private insurance or pay for services not covered by the private insurance.

But also talk to the facility. I don’t know what type of treatment she’s there for- but I do know that when I refer someone to residential substance abuse treatment, the programs will often tell people with private insurance to apply for Medicaid/public assistance. Because the private insurance won’t pay for the residential treatment but Medicaid/public assistance will.

Bolding mine.

This is exactly what I was saying in my earlier post. Medicaid covers many things that private insurance won’t. It also covers deductible and co-pays leftover from the private insurance.

However, for routine medical care it can be difficult to find a doctor that accepts Medicaid - that’s where having private insurance in addition is a great help.

I doubt Medicaid would cover her residential expenses, unless the facility were able to provide some kind of bill that separated out the various components.

She’s in a therapeutic residential facility that combines work (it’s a working farm) and therapy sessions and medication supervision etc. She’s one of the less-disabled people there in some ways; a large percentage of residents have substance abuse history and other self-destructive behaviors. She’s “just” depressed / severe anxiety / ADHD. She actually grumbles that there is much more focus on handling those issues, but the place does seem to have gotten her on a better path (medication changes, working with her on activities of daily living etc.).

One of the staff there told me we needed to drop her private insurance and that we could do so w/o waiting for annual enrollment. From everything I can find, this does NOT qualify as a life event (now, if she had Medicaid, and lost eligibility, we could enroll her because losing other coverage does qualify).

I do need to look into the “adult disabled” thing for insurance. My son is autistic, though high functioning, and that clearly started before age 18. My daughter’s issues also were evident for many years though they’ve worsened since she finished high school.

She might qualify for SSI, though just. There are special rules for how many “quarters” you have to have worked at specific ages. She had a very part-time job for close to 3 years and I did the math and she might just squeak by. But if she gets the mental health stuff under better control, there’s zero reason she wouldn’t be able to work.

You don’t need to have worked at all to receive SSI. The rules about how many quarters you need to have worked at specific ages are for Social Security Disability, a completely different program. Even children can receive SSI Understanding SSI - SSI Eligibility .And in some states, all SSI recipients are also enrolled in Medicaid. I’m pretty sure that the residential programs I mentioned earlier bill Medicaid for the actual medical services and use public assistance/SSI to cover the other expenses