Using Medicaid to Cover Services for Elderly Persons in Residential Care Settings: State Policy Maker and Stakeholder Views in Six States. Financial Criteria For Individuals Living in Adult Care Homes


  • Since 1974, North Carolina has provided a state income supplement called Special Assistance (SA) to aged, blind, and disabled persons who reside in Adult Care Homes.4 Special Assistance is funded jointly by the state and the counties, each contributing 50 percent. Effective October 1, 2003, the maximum monthly SSI/SA benefit for an individual is $1,112 and the personal needs allowance is $46 (the federal portion is $552 and the state portion is $560.) Couples are treated as individuals one month after entering an adult care home.5

  • To quality for Special Assistance, a person needs (1) to have a monthly income less than $1,112 and (2) to reside in an Adult Care Home. The amount of supplementation a person receives depends on their income. A person who is eligible for SSI would receive $560, whereas a person with an income of $850 would receive $262. The combined SSI/SA amount, minus a $46 personal needs allowance, is paid to the Adult Care Home for room and board and some services ($1,066).

  • Aged or disabled individuals whose income exceeds 100 percent of the federal poverty level ($749) but is less than the combined SSI/SA amount of $1,112 are not eligible for Special Assistance and Medicaid if they live in their own homes.6 The only way they can qualify for Medicaid--and thus for personal care services--is to either: (1) spend down the excess income on medical expenses to $242 (the protected monthly income amount), or (2) enter an Adult Care Home.

    Once they enter the Adult Care Home, they are not only eligible for Special Assistance, to help them pay for room and board, but they are eligible for Medicaid, which will pay all their health care costs, including prescription drugs.

  • It is theoretically possible for an individual to spend down income and become eligible through the medically needy program while living in an adult care home. However, it is unlikely that this would occur because the medically needy income limit in an adult care home is the same as in a person's own home: $242. Because this amount would not be sufficient to pay for room and board, spending down in an adult care home is not practically possible.

  • The state currently has a demonstration project which is providing Special Assistance to up to 800 persons aged 18 through 64 with disabilities or aged 65 and older, who reside in their own homes but are at risk of placement in an adult care home.

  • Special Assistance is also available in some counties for "certain disabled." These are adults between the ages of 19 and 65 who are living in their own homes, are unemployable because of an impairment, but have not been able to meet the Supplemental Security Income (SSI) disability requirement.

  1. At a county's option, blind and disabled adults who are not eligible for SSI may also receive a supplement in a private living arrangement. They are covered under "certain disabled" provisions but receipt of the SA does not confer Medicaid eligibility as it does to individuals residing in Adult Care Homes.

  2. In August 1995, the combined SSI/SA payment was lowered from $982 to $800. The savings were used to provide the state match for the new Medicaid personal care benefit. The reduction resulted in some people in adult care homes not meeting the Special Assistance income eligibility criteria, and thus losing Medicaid eligibility. However, the state grand-fathered them for continued coverage.

  3. There are some exceptions, a discussion of which is beyond the scope of this report.

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