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As a Medicare beneficiary, where you live – meaning your state of residence – can have a significant impact on the care that you receive and how you pay for that care during your “golden years.” This page explains how Vermont’s regulations and policies are likely to affect your bottom line.
Many Medicare beneficiaries who struggle to afford the cost of Medicare coverage are eligible for help through a Medicare Savings Program (MSP). In Vermont, these programs pay for Medicare Part B premiums, Medicare Part A and B cost-sharing, and – in some cases – Part A premiums.
MSP asset limit: There is no MSP asset limit in Vermont.
Some beneficiaries – those whose incomes make them eligible for Medicaid – can receive coverage for Medicare cost sharing and dental and vision services if they’re enrolled in Medicaid for the aged, blind and disabled (MABD).
MABD doesn’t ordinarily cover Long Term Services and Supports (LTSS). Applicants usually have to apply for those services separately, undergo an evaluation, and meet a different income limit.
Eligibility: The income limit – for both single and married applicants – is $1,358 a month in Chittenden County and $1,258 a month outside Chittenden County.
Asset limits: The asset limit is $2,000 if single and $3,000 if married.
Applicants with incomes too high to qualify for Medicaid benefits for the aged, blind and disabled (MABD) can enroll the Medicaid spend-down in Vermont, which medical expenses to be subtracted from the income that is counted toward the Medicaid eligibility limit.
Enrollees activate their coverage by submitting medical bills equal to the amount their income exceeds the spend-down program’s income limit (known as “excess income”).
Vermont approves spend-down benefits for specific periods of time, with additional coverage requiring new medical expenses to be submitted. This spend-down “budget period” lasts one-month for long-term care – and six-months for MABD benefits.
Enrollees must satisfy the asset test that applies to other MABD enrollees.
The Medicaid spend-down in Vermont covers LTSS.
The State Pharmaceutical Assistance Program (SPAP) in Vermont – called VPharm – provides additional drug coverage for Medicare Part D enrollees.
VPharm significantly lowers the co-pays for drugs covered by Part D – to between $1 and $2 each. This program also pays a portion of an enrollee’s monthly Part D premium.
This program charges an income-based premium – of up to $50 a month.
SPAP enrollees receive a once-yearly special enrollment period (SEP) to change Part D or Medicare Advantage Prescription Drug plans.
$15/person/month Income limit: The income limit is $1,823 a month if single and $2,465 a month if married.
$20/person/month Income limit: The income limit is $2,127 a month if single and $2,876 a month if married.
$50/person/month Income limit: The income limit is $2,734 a month if single and $3,698 a month if married.
Asset limit: This program doesn’t have an asset limit.
This application form can be used to apply for VPharm (or for a different prescription drug assistance program – Healthy Vermonters – which has a somewhat higher income limit).
The Vermont Legal Aid website has additional information about prescription drug assistance.
Medicare beneficiaries who also have Medicaid, an MSP, or Supplemental Security Income (SSI) will receive Extra Help. This program lowers Medicare Part D prescription drug costs. When beneficiaries apply for this program themselves, the income limit is $1,843 a month for singles and $2,485 a month for couples. The asset limit is $16,660 for individuals and $33,240 for spouses.
Medicare beneficiaries increasingly rely on long-term care, and the portion of seniors needing these services will keep rising as the population ages. However, long-term care is mostly not covered by Medicare. While Medicaid fills the gap in Medicare coverage for long-term care, its complex eligibility rules can make qualifying for benefits difficult. What’s more – eligibility rules vary significantly from state to state.
Applicants who are seeking Medicaid long-term care benefits have to undergo a level of care assessment.
Long-Term Care Medicaid is called Choices for Care in Vermont.
Income limits: The income limit is $2,742 a month if single and $5,484 a month if married (and both spouses are applying).
When only one spouse needs Medicaid, the income limit for single applicants is used – and only the applicant’s income is counted.
However, this income limit doesn’t mean an applicant can keep all of this income up to the limit. Nursing home enrollees must pay nearly their entire income toward their care, other than a $72.66 personal needs allowance and the cost of health insurance premiums (such as Medicare Part B and Medigap).
Assets limits: The asset limit is $2,000 per applicant. If only one spouse needs Medicaid, spousal impoverishment rules allow the other spouse to keep up to $148,620.
Certain assets are never counted, including many household effects, family heirlooms, certain prepaid burial arrangements, and one car. Enrollees aren’t allowed to have more than $688,000 in home equity.
Every state’s Medicaid program covers community-based LTSS services. These services are called Home and Community-Based Waiver (HCBS) services because recipients continue living in the community, rather than entering a nursing home.
Income limits: The income limit is $2,742 a month if single and $5,484 a month if married (and both spouses are applying).
When only one spouse needs Medicaid, the income limit for single applicants is used – and only the applicant’s income is counted.
Assets limits: The asset limit is $2,000 per applicant. If only one spouse needs Medicaid, spousal impoverishment rules allow the other spouse to keep up to $148,620.
HCBS recipients can’t have more than $688,000 in home equity.
Eligibility rules for Medicaid LTSS programs differ from other Medicaid benefits when only one spouse is applying. When this occurs, only the applying spouse’s income is counted. (Normally with Medicaid benefits, the income of both spouses is counted – regardless of who is applying.)
Spousal impoverishment rules allow community spouses of Medicaid LTSS recipients to keep a Minimum Monthly Maintenance Needs Allowance (MMMNA) from their Medicaid spouse’s monthly income.
In Vermont in 2022, these spousal impoverishment rules allowed community spouses to keep:
Federal law requires states to limit eligibility for Medicaid nursing homes and HCBS to applicants with a home equity interest below a specific dollar amount. States set this home equity limit by choosing between a federal minimum of $688,000 and maximum of $1,033,000 in 2023.
Vermont uses the federal minimum home equity limit – meaning applicants with more than $688,000 in home equity are ineligible for LTSS programs.
Because long-term care is expensive, individuals can have an incentive to give away or transfer assets to make themselves eligible for Medicaid LTSS. To curb these asset transfers, federal law requires states to institute a penalty period for Medicaid nursing home applicants who give away or transfer assets for less than their value. States can also have a penalty period for community-based LTSS.
Vermont has an asset transfer penalty for both nursing home care and HCBS. The state uses a 60-month lookback period to calculate this asset transfer penalty – meaning that asset transfers or gifts made during this period may result in ineligibility. This penalty is calculated by dividing the value of asset transfers and gifts by the monthly cost of nursing home care (about $10,422 in Vermont in 2023).
A state’s Medicaid agency is required to recover what it paid for LTSS and related medical costs while an enrollee was 55 or older. The law allows states to also pursue estate recovery against beneficiaries who did not receive LTSS, and beneficiaries who were under 55 and permanently institutionalized.
Vermont has chosen to only recover from the estates of enrollees who receive LTSS when they were 55 or older. This means the Medicaid expansion population in Vermont is not subject to Medicaid estate recovery, even for the Medicaid coverage they receive from 55 to 64 years of age, unless they also need LTSS during that time.
In states where private Medicaid managed care organizations (health insurance companies) provide coverage, Medicaid estate recovery involves the state recovering the amount it paid the insurer for the beneficiary’s coverage. But Vermont does not use private Medicaid managed care organizations.
Vermont will grant an exemption to estate recovery in cases where recovering from an estate would cause undue hardship, or when the estate consists only of personal property valued at less than $2,000.
Senior Health Insurance Program (SHIP)
Free volunteer Medicare counseling is available by contacting the State Health Insurance Program (SHIP) at 800-642-5119. This federal government sponsored program is offered through Area Agencies on Aging (AAAs) in Vermont.
The SHIP can help beneficiaries enroll in Medicare, compare and change Medicare Advantage and Part D plans, and answer questions about state Medigap protections. Counselors may also be able to provide referrals for home care agencies or long-term care services. This website has a list of AAAs in Vermont.
Elder law attorneys
Elder law attorneys can help individuals plan for Medicaid long-term care benefits. You can use this search feature from the National Academy of Elder Law Attorneys (NAELA) to find an elder attorney locally.
Vermont’s Medicaid program is administered by the Department of Vermont Health Access (DVHA). You can apply online for Medicaid, the MSP, VPharm and Healthy Vermonters. This website contains a downloadable application for those programs.
A shorter application that does not ask about assets – available here – can be used when applying only for the MSP, VPharm and/or Healthy Vermonters. This is the application for Medicaid LTSS coverage (Vermont Choices for Care).
An in-person interview is always required when applying for long-term care benefits, and some states also require one for Medicaid ABD. However, interviews are no longer required for the MSP.
