As we age, many of us become increasingly concerned about the possible need for long term care and the options available to pay for it. In this article, we will examine those options.
There are 5 basic ways to pay for long term care:
1. Private Pay
2. Long Term Care Insurance
3. Medicare
4. Medi-Cal
5. Veterans Benefits
Not all of these methods will be available to all persons. For example, veterans benefits are limited to only certain veterans. Long term care insurance may not be available for persons with certain pre-existing conditions. While this list is not exhaustive, it represents the most likely sources of funds to assist with payment of long term care costs.
Private Pay
If you have savings and investments, you can pay for long term care yourself. Your social security check will pay part of the monthly fee, but because the average nursing home cost in California exceeds $9o,000 per year, most people can’t afford to make these payments indefinitely. The costs in some facilities can exceed $100,000.
You can private pay for care at home, in assisted living, or a nursing home.
Long Term Care Insurance
Like all insurances, you must purchase long term care insurance before you need it. It is frequently recommended to begin shopping for long term care insurance when you’re about age 50, An earlier purchase may be wise if early onset dementia runs in your family.
The cost of long term care insurance will depend upon your age, health, and the coverage you choose, but it’s likely at least $1,000 to $2,000 per year.
Long term care insurance pays for care at home, in assisted living, or a nursing home. Certain elder law attorneys work with insurance professionals who specialize in long term care products. Ask for a referral.
Medicare
Many people mistakenly believe that the Medicare program will provide considerable assistance in paying for long term care. However, sadly, it just isn’t so. Medicare primarily provides some assistance with long term care costs in two limited situations: rehabilitiation and hospice.
To trigger the available rehab benefit, one must typically enter the nursing home directly following discharge from an acute care hospital. The maximum benefit is 100 days of coverage per spell. But it could terminate sooner should the patient fail to continue to improve.
The hospice benefit is triggered by a physician’s determination that, due to a fatal condition, the patient is not expected to live six months. The purpose of the program is to provide palliative care while one is dying.
In Overview of How to Pay for Long Term Care (Part 2 of 2); we’ll discuss using Medi-Cal and Veterans Aid and Attendance to pay for long term care.
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