Last Updated: June 18, 2014
The cost of senior care can stretch family budgets to the
breaking point, but financial help is available. Medicare, Medicaid
and the U.S. Department of Veteran Affairs offer assistance
programs that can help pay for eldercare in certain
is national health insurance that all Americans receive when they
turn 65. Disabled people who are under 65 can also enroll in
Medicare without paying premiums. Medicare is usually not helpful
to those looking for a solution to long term care needs.
Medicare Covers Only Short-Term
Medicare can cover short-term rehab stays at a nursing home, for
example, after a hospitalization. It can also pay for rehab and
therapy at home for a limited period of time and when prescribed by
But it's vitally important to recognize that Medicare does not
pay for custodial care. Medicare should primarily be considered
health insurance. This means Medicare does not pay for the
following types of senior care:
- Assisted living
- Long term care at a nursing home
- Residential care homes
- Any long term care
For more information about Medicare, see http://www.medicare.gov.
Medicaid is the foremost government assistance program paying
for long term care for people who can't afford it on their own. It
is administered cooperatively by the federal government and states.
While the majority of its funding comes from the federal
government, each state has some discretion in its individual rules,
regulations and eligibility requirements.
Eligibility for Medicaid
- A senior has to put almost all of his or her existing assets
- Low income, or at least have medical or care expenses that are
higher than income.
- If a married couple wants to qualify for Medicaid, the couple
does not need to have exhausted all financial resources. The
healthy spouse can usually keep the home he or she lives in, but
may still have to make significant sacrifices.
Medicaid is the Social Safety Net for Ailing Elders
Medicaid is the safety net for Americans who need care that they
cannot afford privately. Like Medicare, Medicaid acts as health
insurance. But unlike Medicare, Medicaid can be used to pay for
long term nursing home care in all states. Many states also allow
their residents to use Medicaid to pay for assisted living
communities or other alternatives to nursing homes such as in-home
Some states even offer a program through Medicaid called PACE
(Program of All Inclusive Care for the Elderly), which covers all
of the senior's care and medical needs through one contracting
agency, with the goal of allowing people who have traditionally
gone to nursing homes to stay in the community (at home) with
State Medicare and Medicaid Guidelines
Each state has its own guidelines, so you will need to contact a
State Medical Assistance office for more details:
You may also want to speak with an elder law attorney who can
help guide you through the nuances of a successful Medicaid
Veterans who are at least 65 years-old and who served during war
time (though not necessarily in actual combat) may be eligible for
financial assistance through the U.S. Department of Veteran Affairs
(VA) that can be used to help pay for care. Spouses, surviving
spouses, and even other dependents of the veteran may be eligible
for assistance in some cases as well.
There are three levels of VA benefits for wartime veterans and
their dependents, which are based on the needs of the
- Basic Pension: Basic Pension is designed to
function as cash assistance for low income veterans and their
dependents. Applicants may be healthy.
- Housebound Benefit: Housebound assistance with
day-to-day activities must be needed on a regular basis.
- Aid and Attendance: Assistance must be
required on a "daily basis."
Assistance from the VA is "means tested," in other words, only
people who are deemed genuinely in need will receive an award. It
also means that the amount of the benefit is based on the
applicant's income, assets, and needs. Applicants whose countable
incomes are over maximum thresholds (excluding the home they live
in and the care they drive), will usually be denied. But in
situations that are borderline it can't hurt to apply, as decisions
are largely made on a case by case basis. For more detailed
information, download our
Guide to Paying for Assisted Living with VA Benefits
How to Apply
Like Medicaid, VA benefits can be extraordinarily complex. For
this reason you might also consider speaking with a Veteran
Services Officer. Veteran Services Officers volunteer through the
United States, frequently at hubs for veterans like American Legion
halls Veteran of Foreign Wars (VFW) lodges.
To apply for VA health care or determine eligibility,
- Call (877) 222-VETS: Health Benefits Service Center
- Contact your local Veterans Benefits Office or Medical
- Visit the Department of Veterans Affairs website www1.va.gov/directory/guide/home.asp
Non-Government Options for Financing Senior Care
Medicaid, VA benefits, and to some extent,
Medicare, are government programs that help pay for care for older
people in the United States. But there are alternatives. Some
families also explore reverse
life settlements to raise funds to pay for necessary care.
Our Senior Living Advisors are happy to discuss, at no cost, the
financial aspect of care planning. They can talk you through the
options, and even suggest local experts who can help you pursue
financial aid options outlined in this article. Talk to an Advisor in your area