When families start looking into home care services, they assume that Medicare or their health insurance plan will cover those costs too. Today, non-medical home care is not covered by health insurance, Medicare or Medicare supplemental plans.
Many people are under the impression that their State will pay for care under Medicaid.
This is true, but generally, the care will only be provided in a nursing home, regardless of whether or not you need nursing home level care. Medicaid becomes the payor once you have run through all of your personal assets. In addition, Michigan now has a look back period. If you try to transfer assets to trusts or your family during the 5 years prior to filing for Medicaid the State will penalize you.
That means the cost of care falls squarely on the seniors or their families. I have outlined 5 ways to pay from home care to help families access the care that they need.
Here are 5 ways to pay for home care:
-Private Pay, or “Out of Pocket”
Paying out of pocket from income or savings to cover the cost of home care expenses. Many seniors have trust, retirement or savings they have built up over the years. They were saving for a “rainy day”. It is estimated that about 70% of people pay for home care expenses out of pocket.
Many people are initially overwhelmed about the cost of care. They are unsure of how long they will need or how much they will need. For most people, remaining in their homes with home care is a lower cost option than moving to an independent or assisted living. This is particularly the case when care is needed for a couple.
For long term planning options, you may want to speak with a Certified Geriatric Care Manager. They are specially trained to assess not only your care needs but understand the costs and the options in the market today.
Call Alliance Senior Care to set up a consultation with a Geriatric Care Manager. If you are outside of the Metropolitan Detroit area, you can find a Geriatric Care Manager through ALCA – Aging Life Care Association at https://www.aginglifecare.org/
-Long Term Care Insurance
Long Term Care Insurance is specifically designed to pay for non-medical home care and other expenses that are associated with remaining in your home and aging in place. Long Term Care Insurance is a separate policy, similar to a life insurance policy. It needed to be purchased years prior when the insured was in good health and premiums need to continue to be paid.
Some common Long Term Care Insurance Providers are: John Hancock, Genworth, Bankers Life, CNA, One America, and Equitable. Some people may have purchased policies from other insurers like GE who have since sold off those policies.
Every Long Term Care Insurance Policy has different coverage levels and limits. It is important to work with a provider that is knowledgeable about Long Term Care Insurance, such as Alliance Senior Care. Alliance Senior Care will guide you through the entire claims process and assist you in receiving the benefits you have paid for. To get a better understanding of what your policy covers, Alliance Senior Care offers a free review of your Long Term Care insurance policy.
The VA provides up to $2,230 a month in cash assistance to pay for non-medical home care. Veterans that were enlisted 1 day during any of the periods noted below may be eligible.
Period of War Beginning and Ending Dates:
- World War II December 7, 1941 through December 31, 1946
- Korean Conflict June 27, 1950 through January 31, 1955
- Vietnam Era August 5, 1964 through May 7, 1975; for veterans who served “in country” before August 5, 1964, February 28, 1961 through May 7, 1975
- Gulf War August 2, 1990 through a date to be set by law or Presidential Proclamation
The VA does offer this benefit to surviving spouses also. Here is some additional information regarding the VA programs that assist with paying for home care: https://www.alliancesrcare.com/specialty-care-management/#veteran
Some life insurance policies include a rider that allows the insured to access some or all of the funds to pay for long term care. Each insurance policy is different and must be reviewed to determine if the policy offer some benefits and how to access them.
For many seniors, their home is their biggest asset, but they want to remain in their home.
A reverse mortgage is a federally regulated mortgage that can allow older adults to tap into the equity in their home to pay for home care AND ensure that they are never forced to leave their homes.
Loans can be designed to take out a lump sum or a monthly amount to pay for the home. This can be an effective mechanism to ensure that individuals can remain in their homes.
Contact Alliance Senior Care at 248-274-2170 to discuss if this may be an option for you.