It can be difficult for a senior living on a fixed income to cover necessary expenses like rent or medical bills, but it’s easy enough to find local, state and, federal programs that can help older adults on lower incomes cover their current and future care expenses.

Unfortunately, understanding how these different programs work is another story— challenging at best and impenetrable at worst.

Current programs directly related to affordable senior living are often buried in an obscene amount of confusing paperwork, guidelines, and restrictions, written in language that can be difficult for the average person to understand.

When planning for your future care needs, understanding the differences between Medicare and Medicaid, and how they work together, can help you determine what kind of care you need and can afford.

Senior living and healthcare expenses can add up quickly, so genuine preparedness is necessary to ensure that your needs are met now and in the future.

First Things First: What is Medicare?

Medicare is the federal health insurance program for those over the age of 65 and a limited number of other disadvantaged groups. You probably already know that there are different types of Medicare, but you may be less clear on what it is that those different parts actually cover.

• Medicare Part A.  Hospital Insurance— this covers inpatient hospital stays, care in a nursing facility, hospice care, and some health care.
• Medicare Part B.  Medical Insurance— this covers certain doctors’ services, outpatient care, medical supplies, and preventive services.
• Medicare Part C. Medicare Advantage Plans— a type of Medicare health plan offered by an outside, private insurance company that contracts with Medicare to provide you with both Part A and Part B benefits.
• Medicare Part D. Prescription Drug Coverage— adds prescription drug coverage to Original Medicare (Parts A and B), as well as various Medicare Part C plans.

The most significant thing to note here is that due to strict requirements, Medicare covers only essential, life-saving medical expenses. Seniors looking for financial assistance with in-home assisted living or long-term residential care must look elsewhere for coverage.

Next: Understanding Medicaid

Medicaid is a social healthcare program for families and individuals who are living on a fixed income and do not have the resources available to afford health care. It is jointly funded by both federal and state governments, but implemented and managed by the states.

For individuals on a limited and/or fixed income who are also enrolled in Medicare, Medicaid can be used as a means to pay for supplement premiums and other out-of-pocket medical expenses. Seniors who qualify for both Medicare and Medicaid will have their expenses covered first by Medicare, while Medicaid picks up any remaining costs—up to and including long-term care.

Unlike Medicare, Medicaid will pay nearly all long-term care expenses for seniors who meet specific financial or medical qualifications through a waiver system.

Medicaid Waviers, also known as the HCBS Waivers (Home and Community Based Services), are state-specific Medicaid programs that provide financial support for seniors who need assisted care, though you should be aware that these programs do have enrollment caps and often waiting lists.

It’s also necessary to note that each state has its own Waiver system with a unique name and set of qualifications, so it may be helpful to consult your primary care physician and a social worker who specializes in eldercare to determine exactly what kind of care you need and what kind of coverage you qualify for through Medicaid.

Your Future, Your Care

There are a lot of things to consider as you begin to plan for your future care needs, not the least of which is how to best utilize Medicare and Medicaid to receive the benefits and assistance you need most.