Care Facts

Who Pays for Long Term Care

The facts may surprise you

Education is key!  It is important to understand what is, and what is not covered.  Consumer surveys reveal common misunderstandings about which public programs pay for long-term care services.

Let’s take a closer look at what people will depend on

Medicare:

  • Only pays for long-term care if you require skilled services or rehabilitative care:
    • In a nursing home for a maximum of 100 days, however, the average Medicare-covered stay is much shorter (22 days).
    • At home, if you are also receiving skilled home health or other skilled in-home services. Generally, long-term care services are provided only for a short period of time.
  • Does not pay for non-skilled assistance with Activities of Daily Living (ADL), which make up the majority of long-term care services
  • You will have to pay for long-term care services that are not covered by a public or private insurance program

Medicaid:

  • Does pay for the largest share of long-term care services, but to qualify, your income must be below a certain level and you must meet minimum state eligibility requirements
  • Such requirements are based on the amount of assistance you need with ADL
  • Other federal programs such as the Older Americans Act and the Department of Veterans Affairs pay for long-term care services, but only for specific populations and in certain circumstances

Good To Know

Like public programs, private sources of payment have their own rules, eligibility requirements, copayments, and premiums for the services they cover.

Health Insurance:

  • Most employer-sponsored or private health insurance, including health insurance plans, cover only the same kinds of limited services as Medicare
  • If they do cover long-term care, it is typically only for skilled, short-term, medically necessary care

There are an increasing number of private payment options including:

  • Long-term care insurance
  • Reverse mortgages
  • Life insurance options
  • and Annuities

The Situation in 10, 20 and 30 Years

  • The sheer number of aging baby boomers means the demands for long-term care will only continue to soar.  !0,000 baby boomer retire each day!
  • Inflation will continue to increase the costs of long-term care.  Be sure you plan will cover the added expenses.
  • It is crucial that we get people off the welfare rolls and away from Medicaid as a source to pay for long-term care.
  • State governments are in critical situations now.  What will happen down the road when the number of people needing LTC will increase and costs will be higher? States will not be able to afford to continue funding these types of expenses.