Because it costs about $100,000 annually to live in a nursing home, it’s understandable to feel overwhelmed when considering how to pay for it. Many caregivers of older adults wonder: Does Medicare offset the expense?
Let’s look at common questions about government programs and explore options for paying for live-in community care.
What services does Medicare cover?
Think of Medicare only as health insurance. Medicare is separated into different parts that each cover a different aspect of health care. Medicare Part A is hospital insurance. It can be applied to inpatient hospital stays, hospice care and some home health services.
Medicare Part B is for medical expenses such as doctor bills, durable medical goods and preventive services. Medicare Part D is optional and assists with prescription drug coverage. Because prescription drugs can be expensive, it may be worth it to consider adding Part D during the Medicare open enrollment period, even if you don’t need prescription drugs at the moment.
Medicare Part C (also known as Medicare Advantage) is offered by private insurers. It replaces Parts A and B and adds vision, hearing and dental service coverage. Some Medicare Advantage programs also replace Medicare Part D by offering prescription drug coverage.
Does Medicare cover living in a nursing home?
The simple answer is no. Just like most health insurance plans, Medicare does not pay for long-term care stays. That means Medicare will not pay for any type of long-term residence—including assisted living and memory care facilities. However, it can help pay for the necessary doctors’ services and medical supplies a person might need while staying at such a facility.
In a situation where someone is admitted to the hospital and then needs further oversight to recover, Medicare will cover part of the short-term rehab stay, which could take place in a nursing home.
Medicare covers a portion of the short-term stay up to 100 days, as long as the patient continues to get better. If the patient’s health is not deemed to be improving, coverage will be terminated. But if the patient is making progress and needs to exceed the 100-day limit, an appeal for a longer stay can be submitted.
How can I pay for a long-term stay in a nursing home?
There are a few programs that might help cover costs. Long-term care insurance is an option to consider if there’s sufficient time to plan ahead. If the person has served in the U.S. military, veterans and their spouses can seek VA benefits to cover stays at selected facilities. There are also financial instruments such as reverse mortgages or even whole life insurance policies that can help.
Actually, many people start by paying for nursing home care out of their own savings, primarily because of the flexibility it offers when choosing a facility. Skilled nursing care communities have a limit on the number of government-funded patients they can admit. So, private payers gain the advantage of choice in selecting a nursing home that meets their needs. If paying privately is not feasible, Medicaid then becomes an option.
What is Medicaid? Will it pay for a skilled nursing facility?
Medicaid is a government program that is often confused with Medicare because of the similar name. Although it receives federal funding, it’s actually administered by each individual state. Medicaid helps certain people with lower incomes, families and children, pregnant women, the elderly and people with disabilities to afford care.
You’ll need to check with your state to learn more about eligibility and long-term benefit services in your area. If eligible, Medicaid will pay for custodial care in a Medicaid-certified nursing community. The program covers the cost of nursing home care, but it does take most of the patient’s income in return.
What are alternatives to nursing homes?
Nursing homes are costly because of the high level of medical care they provide. They offer room and board, around-the-clock care and 24/7 access to professional medical attention.
If your loved one does not need full-time licensed medical care or is uncomfortable with large group settings, you may consider a personal care home. These group homes for seniors are generally smaller, family-run environments where residents can get help with daily living activities. The monthly costs are typically much lower than nursing homes, but many only accept private payment.
Another option might be to find an agency that can help you choose a provider for home health care or live-in care. This way, your loved one can remain in their residence and still get the assistance they need. Some aspects of home health care may even be covered by Medicare.
What if I have more questions?
Medicare is a complex program with a wide variety of coverage options. It can be helpful to talk to others who have shopped for nursing homes and health care to learn from their experiences.
