Last updated: August 2009

(Chapter 2 Section 2 of Senior Citizens Handbook)

What It Is: A state and federal program that pays for certain medical expenses.

Where to Apply: Illinois Department of Human Services (DHS)

Who May Be Eligible: Persons who are 65 years or older or blind or disabled, and cannot afford to pay their medical bills.

How Medicaid Works

In General

If you are eligible for Medicaid, you will receive a card, called a Mediplan card. This card can be used to pay for doctor visits, health care, prescription drugs and other medical care, without cost to you. 

Medicaid is a welfare program run by the Illinois Department of Healthcare and Family Services (HFS), formerly the Illinois Department of Public Aid (IDPA). However, the Illinois Department of Human Services (DHS) is the state agency that actually takes applications and makes eligibility determinations for Medicaid.

To be eligible, your income and assets must be below a certain level. If your income or assets are over the limit, you may be ineligible, or you may have to pay some of your medical bills and Medicaid will pay the rest.

Not all doctors participate in the Medicaid program. Also, the law does not require those doctors who do participate to accept all Medicaid participants. If your medical providers do participate in Medicaid, they cannot discriminate against you in the type or quality of treatment you receive just because Medicaid pays for the services.

Who is Eligible for Medicaid?

If you are 65 years or older, blind or disabled by Social Security's definition, you may be eligible for Medicaid. DHS determines eligibility by considering your income and assets and comparing them to financial eligibility criteria.

To be disabled means to be unable to work due to a physical or mental impairment which has lasted or is expected to last for at least 12 months or to result in death. For a detailed discussion of Social Security’s five step analysis to determine whether an individual is disabled, see the section of this Handbook on “Social Security.”

Income and Asset Limits

The income limit for Medicaid coverage of adults varies for different categories of applicants. For adults who are blind, disabled or who are age 65 or over, DHS has established a community standard income level. This level is 100% of the federal poverty level.

You are eligible for Medicaid if your income is below the community standard income level. If your income is over the community standard, you will have an income spend down before Medicaid will be available to cover medical bills. The spend down process is discussed in greater detail later.

DHS does not count certain types of exempt income in determining your eligibility for Medicaid.
Examples: The first $25 per month from any source, SSI benefits, food stamps, the first $50 of the total child support payments received each month, circuit breaker grants, energy assistance grants, earned income tax credits and a portion of employment income.

Also, you are eligible for Medicaid as long as the value of your assets does not exceed a certain level. In determining the value of your total assets, DHS will not consider some of your assets. These types of assets are called the asset disregard.
Examples: DHS disregards $2,000 for a single adult and up to $3,000 for an adult and one dependent residing together and an additional $50 for each additional dependent household member.

If the value of your assets exceeds the asset disregard limit, you will have an asset spend down. Again, the spend down process is discussed in greater detail later.

In the case of adults who are blind, disabled or over age 65, certain types of assets are not counted in determining whether you have reached the asset limit. These are called "exempt" assets.
Examples: The family home, clothing, personal effects, household furnishings, one car up to a certain value or of any value if necessary for employment, medical treatment or transportation of a person with disabilities.

Transfers of Property

For persons seeking Medicaid coverage for long term care in nursing homes, supportive living facilities or through the Community Care Program, there may be a penalty if you or your spouse transfer real or personal property for less than it is worth during the 60 month period before Medicaid application or entry into long term care. A transfer of property occurs when you sell property, give it away, or change the way that it is owned (e.g., you give your right to joint tenancy to another joint tenant). Some transfers are allowable. For example, you can transfer your interest in your homestead to your spouse.

Please note however, that this is an area where there is uncertainty and confusion. We advise you to talk with an elder law attorney if you anticipate needing long term care. This policy on transfer of property does not apply to persons who are seeking Medicaid coverage in the community and who are not in the Community Care Program or in a Supportive Living Facility.

ADVOCACY TIP
Do not sell, give away or change the way you own property without being sure you can do so without jeopardizing your potential Medicaid benefits.

Citizenship

To be eligible for Medicaid, you must be a U.S. citizen, or be within one of several categories of non-citizens.
Examples: Eligible non-citizens include refugees and persons lawfully present in the U.S. for over 5 years.

However, any non-citizen who is ineligible for Medicaid but who meets the financial eligibility criteria is eligible for medical assistance necessary for the treatment of an emergency medical condition.

The "Spend Down" Process

If your income or assets are above the limits, you will have what is called a spend down. A spend down is similar to a deductible under an insurance policy. If you have a spend down, you will be eligible for Medicaid coverage, and you will receive a medical card only after you incur medical bills in the amount of your spend down. The amount of the spend down will vary depending on how much your income or assets exceed the limits.

ADVOCACY TIP
Bills need to have been incurred, but do not necessarily have to be paid, to be submitted to HFS as proof of meeting your spend down.

It is very important, therefore, that you keep copies of all prescription receipts, medical bills and records of other medical expenses. When you accumulate enough bills to meet your spend down, submit copies of the bills to your caseworker in the local HFS office. The program will then process the bills so that you can receive a medical card.

Types of Expenses That Can be Used to Meet the Spend Down

You can use a number of expenses to meet your spend down. They include the following:

• Physician and hospital services
• Medications
• Cost of travel to obtain medical care (when Medicaid is not directly paying for travel)
• Medicare and other medical insurance premiums, deductibles or other insurance co-payments
• Some dental expenses, many in-home care services and over-the-counter medicines when prescribed by a physician

If you have not met your spend down for three consecutive months, HFS will send you a notice stating that your case has been canceled. However, you may reapply for Medicaid at the time you have sufficient bills to meet the spend down.

What is Pay-in Spend down?

In general, Aid to the Aged, Blind and Disabled (AABD) community MANG clients also have the option to "pay" their spend-down amount each month. This is called "Pay-in spend down" and is done instead of, or in addition to, submitting medical receipts. This "Pay-in" option may help you by:

• allowing you to pay ahead of time to make sure you receive your medicaid card at the beginning of the month;
• letting you choose for which months your get a medicaid card;
• not making you keep track of bills and receipts, and then send them to your case worker.

For more information, see Pay-in Spend down on the IDHS website.

How to Apply for Medicaid

You may file an application at your county Illinois Department of Human Services office. Medicaid coverage of incurred medical bills can be granted retroactively, up to 3 full months prior to the date that you apply, as long as you met the eligibility criteria during that period. This is called "backdating” of eligibility. You should specifically request backdating if you have any unpaid medical bills from the 3 month period before your application.

What Services are Covered?

In General

Medicaid covered services for adults include the following:

• Physician Services, including specialists, necessary to diagnose and treat illness or injury;
• Hospital Care, including inpatient, outpatient and emergency room services;
• Vision Services, including exams and corrective lenses;
• Dental Services, including diagnostic and restorative care. The dentist must obtain prior approval before many non-emergency services will be covered;
• Podiatric Care, for diagnosis and treatment of foot diseases and injuries;
• Chiropractic Care, but only if the service is manual manipulation of the spine needed because of a displacement of the spine resulting in a neuro-musculoskeletal condition;
• Prescription Drugs. Prior approval must be obtained for many drugs. When a generic equivalent drug is available, Medicaid will not pay for the full cost of the name brand drug, unless the doctor indicates that the name brand drug is medically necessary;
• Mental Health Clinic Services, including an assessment and development of a treatment plan, crisis intervention, day treatment programs, psychiatric care, therapy and medication management;
• Therapy Services, including physical, occupational, and speech/language services prescribed by a doctor and needed due to illness, disability or infirmity. Prior approval may be required;
• Hospice Care for terminally ill persons, including nursing care, physician services, medical social services, short term inpatient care, medical appliances, supplies and drugs, home health aide services, and therapy and speech/language pathology services to control symptoms. Hospice services may be provided regardless of whether the person resides in the home or in a hospital, nursing home or institution;
• Medical Equipment, Supplies and Devices, when prescribed by a doctor and are necessary to enable a person to remain at home or to function in the community;
• Prosthetic Devices, including communication devices, which are essential to enhance functional mobility, medically necessary communication or are essential to allow the person to independently perform activities of daily living;
• Transportation for Medical Purposes. This includes transportation in a private car provided by a family member or friend, an ambulance, medicar, public transportation or emergency helicopter. Except in emergencies, pre-approval must be obtained. The program pays for transportation only to the nearest available and appropriate provider by the least expensive type which is adequate. When public transportation is available and is a practical form of transportation, the program will not pay for a more expensive mode of transportation;
• Psychological Services, including the services of a psychologist in either a private practice or a community mental health center; and
• Group Care. Medicaid will cover medically necessary institutional care. The program will pay only those facilities licensed by the Illinois Department of Public Health. Pre-approval of group care is required.

Pre-Approval of Certain Medical Care

HFS requires Medicaid recipients to obtain pre-approval of many types of non-routine medical care. Pre-approval also is required for many types of medical equipment and assistive technology devices. In order to receive payment, the doctor or other health care provider, who is recommending the proposed treatment or device, must submit information about why the treatment or device is medically necessary.

Home Care Services

Short term, intermittent, home health services may be covered by Medicaid. Covered services must be of a curative or rehabilitative nature. They must demonstrate progress toward short term goals outlined in a plan of care developed by a doctor. Home health services may be provided by a home health care agency, or by a physical therapist, speech therapist or an occupational therapist.

Long term assistance with activities of daily living is available through several programs discussed in Chapter 4.

Nursing Home Care

Medicaid will pay for intermediate or skilled nursing home care. It will not pay for custodial care in a nursing home. The income and asset eligibility rules for Medicaid are different for nursing home residents.

If the Medicaid eligible adult in the nursing home does not have a spouse, the following rules apply:

• All income except $30 per month must be paid toward the nursing home costs (the $30 exemption is increased to $90 if the nursing residents receives veterans benefits). The normal income exemptions do not apply. However, expenses incurred for medical care not covered by Medicaid can be deducted from income;
• The value of the adult's house is not exempt, unless: the adult intends to return to the home following the nursing home stay, or the house is occupied by a sibling, minor child or disabled adult child of the nursing home resident. 
   
  If the Medicaid eligible adult in the nursing home has a spouse, there are special rules so that the spouse who remains at home will have sufficient income and assets. These are called the community spouse rules.

The Community Spouse Rules

The spouse living in the nursing home may keep non-exempt assets totaling $2,000. In addition, the spouse who continues to live in the community may keep non-exempt assets up to a certain value. This is called the community spouse asset allowance.  For the calendar year 2008, that amount is $104,400. The amount is revised each year. To the extent that the community spouse's assets are below the asset allowance, the spouse in the nursing home may transfer assets to the community spouse.
Example: Sam is a resident of a nursing home. His wife, Mary, resides in their home. Sam's assets consist of a $40,000 Certificate of Deposit. Mary's assets consist of a $20,000 savings account. Sam and Mary also own a joint savings account with a balance of $10,000. Because Mary's assets are below the community spouse asset allowance, Sam may transfer his assets to Mary up to the amount of the community spouse asset allowance. In this case, Sam may transfer all of his assets to Mary, because the total value of the combined assets ($70,000) is less than the community spouse asset limit ($104,400).

For residents of nursing homes, there are special rules regarding income. The spouse in the nursing home may keep only $30 per month. For the calendar year 2008, the spouse in the community could have monthly income of up to $2,610. This is called community spouse income allowance. The amount is revised each year.

For the current community spouse asset and income allowances, please call the Illinois Department on Aging’s Senior HelpLine.

1-800-252-8966 (Voice & TTY)
421 East Capitol Avenue, #100
Springfield, IL 62701-1789

If the community spouse's income is below this level, the nursing home spouse may transfer income to the community spouse up to the maximum income allowance.
Example: Sam is in a nursing home. His wife, Mary, resides in their own home. Sam's monthly income is Social Security of $900 and a pension of $200. Mary's monthly income is Social Security of $700. Because Mary's income is below the community spouse income allowance of $2,610, Sam may transfer his income to Mary up to the amount of the community spouse income allowance. In this case, Sam may transfer all of his income to Mary, because the total value of the combined monthly income ($1,800) is less than the community spouse income limit.

The community spouse rules also apply when one spouse needs in-home services through the Community Care Program.

Help Paying Medicare Cost Sharing Amounts

Qualified Medicare Beneficiaries

Under the Qualified Medicare Beneficiaries (QMB) program, low income persons do not have to pay the premiums, deductibles and co-insurance amounts for Medicare. Instead, HFS pays those amounts.

To qualify, a person must have:

• Medicare Part A
• Countable income must be less than or equal to 100% of the federal poverty limit. In 2009, this amount is $903 per month for one, $1214 per month for a couple. The first $25 of income is deducted.
• Have assets of $4,000 or less for one person or $6,000 or less for a couple

The income amounts may change each year.

Specified Low Income Medicare Beneficiary (SLIMB) Program

If your income is too high to qualify for QMB, you may be eligible for assistance with your Medicare Part B premiums through this program. To be eligible for this program, you must:

• Be enrolled in Medicare Part A
• Have income less than or equal to 120% of the federal poverty limit. In 2008, this amount is $1040 per month for one person, $1400 per month for a couple.
• Have assets of $4,000 or less for one person, or $6,000 or less for a couple

The income amounts may change each year.

Qualified Individual - 1 Program 

Illinois has opted to pay for Medicare Part B premiums for those whose income is between 120% to 135% of the federal poverty limit, through this program. To be eligible, you must meet all other QMB requirements, above, but have countable income less than or equal to 135% of the federal poverty limit. In 2008, this amount is $1,170 per month for one and $1,575 per couple. You cannout qualify if you are eligible for Medicaid.

Medicaid Liens and Estate Recovery

Under federal law, the State of Illinois must try to recover the money it spends providing Medicaid to certain individuals. HFS recovers the money in two ways: by imposing liens against real property (land and houses or buildings on the land) of certain Medicaid recipients, and by filing claims against the estates of deceased Medicaid recipients.

What to Do if DHS Denies Medicaid, QMB, SLIB, or QI-1 or Reduces or Terminates Your Benefits

Appeal Procedures

If DHS denies your application for Medicaid or refuses to cover a medical service or item, you are entitled to file an appeal. You must file the appeal within 60 days of the date of the denial notice. You can file the appeal at your local DHS office, or by calling 800-435-0774 (toll free), 312-793-2697 (TTY) or 800-526-0857 (TTY).

ADVOCACY TIP - IMPORTANT!

To continue Medicaid benefits during an appeal, you must appeak within 10 days of the date of the notice of change OR before the date the change becomes effective (the date the change becomes effective is included on the notice of change). Be sure to get some kind of record that you filed your appeal showing the date you filed it.

After you file the appeal, DHS will hold a pre-hearing meeting. You will meet with the caseworker and his or her supervisor. If the denial was due to a misunderstanding about the facts, DHS may agree to approve the case at this stage.

If DHS does not approve your request at the pre-hearing state, they will schedule a hearing. At the hearing, you will have the opportunity to present your case before a hearing officer, and DHS will then issue a written decision. At the hearing, you have the following right to:

• Be represented by a lawyer, a friend or relative
• Present the testimony of witnesses
• Present documents supporting your case, such as medical records and doctor's statements

If you win an appeal concerning the denial of your initial application for Medicaid, your Medicaid coverage will be retroactive to the date that coverage would have started if your application had been approved. Likewise, if you successfully appeal the termination of your Medicaid, coverage will be restored retroactive to the date of termination.

Review by a Court

If the hearing officer rules against you, you may file a lawsuit in the Illinois Circuit Court. You must file any such lawsuit no later than 35 days from the date that the decision was sent to you.

There are strict rules about who to include as a defendant in such a court case. For Medicaid cases, check your decision and add as a party every agency on the decision - this mau include the Illinois Department of Human Services and the Illinois Department of Healthcare and Family Services. Consult an attorney for further assistance.

You or your lawyer will have the opportunity to make written and oral arguments in support of your case. The judge will then decide whether DHS and the hearing officer fairly considered the facts and properly applied the law. The judge can approve your claim, deny your claim or remand your case to DHS to be reevaluated in accordance with the judge's instructions.

Where to Go for More Information

Statutes and Regulations

• The Federal Medicaid statute can be found at 42 U.S.C. § 1396. 
• The federal regulations are at 45 CFR 246-250. 
• The state Medicaid law can be found at 305 ILCS 5/5. 
• State regulations on medical program eligibility are at 89 Ill. Admin. Code 120.
• State regulations on Medicaid covered services are at 89 Ill. Admin. Code 140.
• State regulations on Medicaid covered hospital services are at 89 Ill. Admin. Code 148.

Agencies and Organizations

DHS - Bureau of Customer Inquiry and Assistance
For the location of your nearest DHS office or other information, call 800-843-6154 (toll free) or 800-447-6404 (TTY).

Illinois Department of Human Services (DHS)

Illinois Department of Healthcare and Family Services (HFS) Website

Other Resources

Client Health Benefits Hotline
For information about eligibility status if you are a Medicaid participant, or for help in finding medical providers participating in Medicaid, call 800-226-0768 (toll free) or 877-204-1012 (TTY).

Illinois Legal Aid Online

Website: www.illinoislegalaid.org

Back to top
Return to Table of Contents

Helpful Organizations
The following organizations may be able to help you with Going to Court

For a list of organizations in your area that may be able to help you, enter your zip code.

Feedback

We welcome your comments and suggestions

User Survey - Please take a moment to fill out our User Survey to help us to provide better service.