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Paying for Nursing Home Care
Nursing homes can be very expensive, ranging from $3,000 to $6,000 or more a month. And unfortunately, the cost of residence in a long-term care facility is not usually covered by most health insurance plans. However, there are many ways to finance nursing home care, depending on the unique situation of the prospective patient. Below are some payment options to consider if you're thinking about placing a loved one in a nursing home.
Personal Resources
About 50% of all nursing home residents pay for their costs with personal resources, whether by dipping into cash savings or liquidating (selling) assets. But even for those with moderate income, a year in a nursing home could potentially wipe out a lifetime of savings. Many long-term residents of nursing homes will eventually become qualified for Medicaid once their savings and other assets are drained.
For individuals who own homes, a "reverse mortgage" is another way to finance nursing home care. This type of loan allows you to use your home as a source of income without losing the benefits of ownership. As with any loan, it's always smart to talk to a financial advisor about the pros and cons of a reverse mortgage before making a decision.
Medicare
Medicare is a federal health insurance program run by the Centers for Medicare and Medicaid Services (CMS). This program is available to individuals over the age of 65 as well as those of all ages who have serious kidney-related disease. For people who require nursing or rehabilitation assistance following a qualifying hospital stay (at least three days), Medicare will finance nursing home costs. To learn about the Medicare program and its benefits, visit the Medicare section of the CMS website.
Medicaid
Medicaid is a state and federal program which provides health care for individuals with low income. Although Medicaid was not originally intended to assist the senior long-term care population, it has become a primary method of paying nursing home costs for people with limited income and assets. Individuals must meet certain financial criteria to receive Medicaid benefits, and the program will only fund care provided in a facility that is certified to receive Medicaid payments. To learn about the Medicaid program and its benefits, visit the Medicaid section of the CMS website.
Long-Term Care Insurance
A long-term care insurance policy is a private policy which helps senior individuals pay for services in addition to standard medical and nursing care. Such services may include assisted living services, visiting nurses, and residence in a nursing home. Long-term care insurance may be an option for those who can't afford to pay privately for long-term care or who wish to protect their assets. This type of coverage can be quite costly, and since it pays out fixed cash benefits per day, it generally will not cover the entire cost of care in a nursing home. What's more, some long-term care policies may pay for nursing home services only in certain state-licensed facilities. The National Association of Insurance Commissioners (NAIC) offers a section on its website devoted to the topic of long-term care insurance which provides additional information on this option.
Veteran Benefits
Veterans may be eligible for long-term care in a VA facility or in a community nursing home that has a long-term contract with the VA. However, benefits are generally limited, and often reserved for veterans with disabilities related to their service. To find out more about veteran benefits, visit the U.S. Department of Veterans Affairs (VA) website and search by zip code to find a VA branch in your local area.
Resources
http://www.takingcareofmomanddad.net/ NursingHomes/Cost/
http://www.thca.org/paying.htm#Heading4
http://www.feddesk.com/freehandbooks/1216-4.pdf
http://www.medicare.gov/nursing/Payment.asp