How To Pay For The Nursing Home
One of the things that concerns most people about nursing home care is how to pay for that care. There are basically four ways that you can pay the cost of a nursing home:
- Long Term Care Insurance – If you are fortunate enough to have this type of coverage, it may go a long way toward paying for the cost of the nursing home.
- Pay with your own funds – This is the method many people choose first. Quite simply, it means paying for the cost of a nursing home out of your pocket. Unfortunately, with nursing home bills averaging between $5,000 and $8,000 per month in our area, few people can afford a long-term stay in a nursing home.
- VA Assistance – This type of benefit may be available to someone over sixty-five years of age or disabled who either served in the military or is a surviving spouse of someone who served in the military. VA special pensions can help to pay nursing home bills. Hurley Elder Care Law attorneys are accredited with the VA to provide more information on VA special pensions.
- Medicaid – This is a primarily federally funded and state administered program that pays for the cost of the nursing home if certain asset and income tests are met.
What is Medicaid?
Medicaid is a needs based public benefits program that is primarily funded by the federal government and administered by each state. The Medicaid program will help pay for long term custodial care in a skilled nursing facility. It is the resident’s responsibility to contribute his/her monthly income toward the cost of care and the remaining charges are paid by Medicaid. Custodial care refers to assistance with the activities of daily living (i.e., activities like dressing, bathing, toileting, preparing meals and so on).
What About Medicare?
There is a great deal of confusion about Medicare and Medicaid.
Medicare is the federally funded health insurance program primarily designed for individuals over age 65. There is a limited long-term care component to Medicare. In general, if you have had a hospital inpatient stay of at least three days, and then you need to go into a skilled nursing facility (often for rehabilitation), then Medicare may pay for a while.
If you have met these criteria, Medicare will pay the full cost of the nursing home stay for the first 20 days and will continue to pay the cost of the nursing home stay for the next 80 days, but with a deductible that’s about $141.50 per day. In order to qualify for these 100 days of coverage, however, the nursing home resident must continue to meet Medicare criteria. It is never possible to predict how long Medicare will cover the “rehabilitation.” From our experience it often falls far short of the 100 day maximum. Also be aware that if you have a Medicare Advantage plan, your coverage may be even more limited.
Why Plan for Medicaid?
As life expectancies and long-term care costs continue to rise, the challenge quickly becomes how to pay for these services. Many people cannot afford to pay $5,000 per month or more for the cost of a nursing home. Even those who can pay for a while may find their life savings wiped out in a matter of months, rather than years.
Fortunately, the Medicaid Program is there to help. In fact, in our lifetime, Medicaid has become the long-term care insurance of the middle class. But the eligibility requirements for Medicaid benefits force you to meet certain financial tests. These tests place limits on the amount of income and assets that you can have. The reason for Medicaid planning is simple… you plan so that if you need it, you will be eligible to receive Medicaid benefits.
