Unlock the SECRET of Direct Deposits for Medicaid in Assisted Living
Feb 06, 2025
Managing Medicaid payments is a vital part of running a successful assisted living facility. These payments keep your operations running, ensuring you can provide top-quality care to your residents. One of the easiest ways to streamline your facility’s finances is by setting up direct deposits for Medicaid payments.
In this blog, I’ll walk you through why direct deposits are important, how to set them up, and tips to avoid common pitfalls.
Check out the video too:
Why Direct Deposits Matter in Assisted Living
For many assisted living facilities, Medicaid is a key revenue stream. Payments from Medicaid can range from $20,000 to $70,000 per billing cycle, depending on your facility's size and the services you offer.
Receiving this money through direct deposit ensures faster access to funds and helps avoid cash flow hiccups. This is critical because delayed payments can disrupt payroll, supply purchases, and other essential operational expenses.
Choosing the Right Bank for Direct Deposits
Your bank is your financial partner. Choosing the right one can make a big difference in how smoothly your Medicaid payments are processed.
Here’s what to look for:
- Direct Deposit Capability: Confirm that your bank supports large Medicaid deposits.
- No Hidden Fees: Some banks charge fees for processing direct deposits, so ask about any costs upfront.
- Medicaid-Specific Experience: Select a bank familiar with handling Medicaid transactions in your state.
Pro Tip: Visit your bank to double-check these details in person before committing.
Common Issues When Setting Up Medicaid Direct Deposits
Setting up direct deposits for Medicaid payments can seem overwhelming, but preparation is key. Mistakes in your application can lead to delays that slow down your entire billing process.
Here’s what you’ll need:
-
A Letter from Your Bank
- This letter should be on official bank letterhead, signed by a branch manager.
- Include your account number, routing number, and a wet signature (not electronic).
-
Direct Deposit Authorization Form
- Provided by your bank, this form confirms your account details.
- Attach a voided check for extra accuracy.
-
Voided Check
- Write "VOID" across a check from your business account. If you don’t use paper checks, your bank can print a substitute for you.
-
Medicaid-Specific Form
- Many states or Managed Care Organizations (MCOs) require a separate form.
- Double-check that all information matches your bank details, including any required prefix numbers for your account.
Avoiding Common Pitfalls
Mismatched Account Details
One of the most common mistakes is entering the wrong account or routing number. Medicaid systems are picky, so even a tiny error can delay your application.
Missing Signatures
Incomplete forms, especially missing signatures, are another common reason applications are rejected. Be meticulous when filling out every required section.
Unnecessary Delays
Double-check your forms before submitting them. Providing extra documentation upfront—even if not required—can often speed up the approval process.
The Medicaid Billing and Payment Process
Medicaid processes claims weekly, but most facilities bill monthly for simplicity. Payments are deposited a few days after processing.
How It Works:
- Submit Claims: You can submit claims daily, weekly, or monthly. Monthly billing is common for assisted living facilities.
- Payment Day: Medicaid processes payments on a specific day of the week, depending on your state.
Knowing your billing cycle and payment schedule helps you plan for consistent cash flow.
The Key to Successful Medicaid Direct Deposits
The secret to smooth direct deposits? Preparation and attention to detail. Follow these tips:
- Over-Provide Documents: Attach all requested forms and extra supporting documents.
- Stay Organized: Keep a checklist to ensure no details are missed.
- Communicate: Regularly check in with Medicaid or your MCO to confirm everything is on track.
Final Thoughts
Setting up direct deposits for Medicaid payments is a game-changer for assisted living businesses. By streamlining your payment process, you ensure steady cash flow, reduce stress, and focus on what truly matters: providing exceptional care for your residents.
Take the time to get it right the first time. A little effort upfront will save you a lot of headaches down the road. Remember, your financial foundation is key to building a thriving assisted living facility!
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Show full transcript 👇
Transcript
00:00:01
medicaid and assisted living have an interesting relationship uh when you're working in assisted living you're going to be dealing with medicaid a lot and something you want to make sure that you're able to do is get paid you want to make sure that your payment works and everything kind of fits into place so you're getting reimbursed for those services that you're rendering at your assisted living facility we're going to get into today the secret about direct deposits for medicaid payments and
00:00:27
assisted living hey everybody i'm brandon gustafson i own and operate two assisted living facilities and i created this channel to help people like you learn the ins and outs of investing in assisted living welcome to assisted living investing [Music] welcome back to assisted living investing in our last video we talked about who you should bank with what's that process like what are some of the options that you want to consider um and and what's that you know what to expect as you're going through
00:01:09
trying to figure out which which entity which institution you should be banking with today we're going to be getting into the secret about direct deposits for medicaid payments and assisted living so the first thing that you want to do is make sure you have a bank that's the first thing that's it's key make sure you've got a bank that is going to allow you to do direct deposits your bank or credit union is a key thing that you want to make sure is able to to work make sure that they can handle those
00:01:40
direct deposits because you're getting big checks you know if you're billing them on a monthly basis like we do your checks are twenty thirty thousand dollars they're they're large um you know if you have a a situation where you have to back bill and you have a 50 60 70 000 check um you want to make sure that they can handle that and you don't want to lose that check so make sure you've got an institution that's going to allow direct deposits um most banks are going to allow that
00:02:09
but it's it's really good to just double check make sure that you don't get in a situation where your banking institution just doesn't accept those direct deposits that's the first thing you want to do figure out if your bank has any special requirements or processes on their end for setting up direct deposits do they need any special type of documentation or or something like that from the vendor which in this case is medicaid you can simply do this by going into a branch and asking them hey i want to set
00:02:39
up direct deposit from i have a business account medicaid is paying me on a regular basis i want to make sure i do this is there anything special that you need from me in order to get that set up you can also call customer service and have that same conversation but those are some some ways you can just make sure that there's not something special on the side of the bank that they need in order to get those direct department direct deposits um payments set up and and working another thing that you'll want to check
00:03:10
on with the bank is do they have any fees associated with receiving a direct deposit you don't want to end up having to pay five bucks every time somebody does it or a half a percent of that income because these are big checks you don't want to end up having to pay something there so again going back to our previous videos on which type of institution you should choose to bank with look at fees and make sure you don't kind of get yourself in a bad situation where they're taking money by just you
00:03:39
know accepting a direct deposit you don't want to get in a bad situation there so make sure you're looking into that on the medicaid side of things as you go through the process of registering with medicaid you're likely going to be asked to provide them with banking information to set up direct deposits so i'm going to talk about that in a previous video about registering with medicaid what that process is like so go ahead and watch that video up there but you know after you become certified as a
00:04:07
medicaid provider you'll be able to start billing for medicaid services all those services that you're rendering and providing to your residents once those payments are submitted they will be processed by medicaid or the mco and then they'll be distributed into your account and i've talked a little bit about the difference between medicaid and mcos in a previous video so go ahead and watch that so you can kind of get a feel for what that is like in my experience medicaid or the mco is
00:04:35
only going to process those claims on uh like a weekly basis so they have a set day say it's a thursday that's when they process it the banks the funds drop into your account the following monday or something like that they they don't do this on a daily basis you could bill them on a daily basis if you wanted to but they're only going to process those payments on a weekly basis so yeah regardless of of how frequently you're you're billing them they're only going to pay you once a week
00:05:03
we personally we build medicaid on a monthly basis we could go a little bit more frequently if we wanted to get the cash flow coming in a little bit more if we needed it for some reason but we just do it on a monthly basis and it seems to work really well for us um so that you know there's there's a tip there for you now this is the part where i'm going to get into really the big secret about what it's like to to get things set up for direct deposit with medicaid this is a thing that you
00:05:31
really need to pay attention to this is extremely important because this has caused delays on our end in colorado it caused a five month delay it caused like a three week delay for us in idaho so extremely important so if if you don't listen to anything else in this video make sure you listen to this right here so the the thing that you want to do is you're going through the process of registering for medicaid they're going to ask for your banking documents which seems simple it seems like oh yeah banking
00:06:02
documents here you go that this is what you need you want to give them as much banking information as you possibly can over just like give them way too much documentation so they don't have any excuse to deny your application or anything like that so we've had several issues getting banking information to medicaid or and mcos as well it doesn't matter who it is we've had issues with both of them so what i'm going to suggest that you provide them with are the following documents so number one is a letter from
00:06:39
the bank on the bank's letterhead signed by a branch manager this letter is going to include the bank account number and the routing number banks are going to have this it's very standard it's not you're not asking them to like create a brand new document something that they have so it's not going to be something new but on top of the bank's signature they're going to want a wet signature or at least something that looks like a wet signature um when you scan it in so make
00:07:07
sure that that signature looks correct it's not a digital signature medicaid and mcos are really a bit of a stickler on that so make sure that these all the signatures that you have on these things make sure they look like real wet signatures not um something that you typed up on on a different application to help you out with your your pdfs make sure it's wet next uh the second thing is going to be a direct deposit authorization slip from the bank it's very similar to the letter that i just talked about
00:07:39
but this is going to contain an image of a voided check on it so oftentimes the bank's going to have this if you're looking to set up direct deposit for your full-time job your w-2 job you can go and get this document from the bank they also have these four businesses so it's it's something like that it's called a direct deposit authorization slip a direct deposit authorization form something like that has an image of a voided check on there that has your bank account and also the routing number
00:08:10
make sure it is also properly signed make sure it has the appropriate signatures in there in the correct locations the next one is just a voided check that you do that you have this is going to have your bank account and routing number on it you don't need to sign this one it just needs to say void on the check if you don't have a check because you're doing a lot of online mobile banking just go to the branch or call the customer service line and say hey i need a sheet of checks and they will
00:08:42
typically be able to give you a sheet of paper that has three or four checks on it you can use that banks have those it's a very simple request and then the last thing that i would suggest is oftentimes medicaid or the mco is going to give you a form that is an internal form for them and they want you to fill in the information on that form make sure that your bank account and your routing number match exactly what is shown on the other documents so for our bank account there's a prefix
00:09:18
number on it that we don't really need when i go to the bank and they ask me for my account number i don't need to give them that prefix number but it is on my check on my voided check when i fill out the form i have to make sure that prefix number is on there even though they don't really need it make sure it is there if you don't have these things they're going to kick it back to you if you're missing a signature the signature doesn't look correct they're going to kick it back to you
00:09:46
just get it right the first time this has caused us such a big headache this is the biggest hold up for us as we went through our process of getting registered with medicaid so i'm telling you right now this is the big secret about getting things set up with medicaid or an mco for your assisted living facility make sure your banking stuff is all put together so you can get direct deposit if you don't have it it's going to hold up your entire application then you can't bill for medicaid and it just
00:10:16
becomes a headache so make sure you have all these things i know that those that's four documents a lot of it is overkill it's it's redundant paperwork and things like that i i recognize that but i just speaking from my own personal experience you're going to want to have all this information it's just going to make it so much more streamlined it's better to give them way too much information than for them to take a month to process things and get back to you and say no we're missing the signature here or nope
00:10:47
that account number doesn't match up correctly just get it right the first time spend the extra 10 minutes to make sure everything matches up that you have all the documentation so that you don't get delayed three months on billing medicaid that's my best advice i think i probably could give you on this entire channel so make sure that you are doing those things um you know you're just gonna need all this information it's ready readily available for you um and so just have it there get it out to
00:11:17
them make sure they they get it so that you can finish that application start building medicaid um i talk about the secrets of of of medicaid and how it works in assisted living i'll link that up above here so you can go and watch that video but make sure you're doing that medicaid it's it's it's confusing it's not that scary you can work through it i'll link another video up here around just like how medicaid works and and that process there specifically in assisted living i i've
00:11:48
talked a lot about medicaid in this channel because i think it's important for you to understand where you're getting into when it comes to medicaid in our next video we're going to be getting into ach what is ach i'm sure you've heard the acronym before so we're going to watch that we're going to go over that in our next video so click up there and figure out what ach is we'll get into that in our next video in closing uh to learn more about investing in assisted living make sure
00:12:13
you visit me on assistedlivinginvesting.net i'd love to see you over on the website i've got free resources over there um other content and the ability to set up some consulting calls so we can have conversations and talk about your specific situation how i can help you out there and then also just follow me on all my other social media platforms would love to continue having the conversations together in those settings and just remember it doesn't take a lot it's just a little bit keep making
00:12:38
progress step by step by step if you keep making progress you will be successful thanks for watching [Music] you
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