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Top Ways to Pay for Nursing Home Care

Merritt Whitley
By Merritt WhitleySeptember 16, 2020
Elderly man at his desk doing calculations by hand and paying medical bills.

About 70% of people age 65 can expect to use some form of long-term care during their lives, says the U.S. Department of Health and Human Services.

Nursing homes uniquely accommodate an older adult’s complex medical and day-to-day needs. Nursing homes offer a range of services, including physical therapy, wound care, injections, and help with feeding, personal care, and more. These specialized services, however, can result in hefty costs for families.

The more you know about government assistance programs, VA benefits for nursing homes, bridge loans, and expert resources, the better prepared you’ll be. Learn more about top ways to pay for nursing home care.

Does Medicare pay for nursing homes?

The short answer is not for very long. Medicare is a federal program that provides health coverage to seniors age 65 and older, but it’s not intended to pay for long-term care or personal care services. Medicare typically covers the cost of short-term care or rehabilitation in nursing homes. This is helpful for older adults who can recover from an injury or other health event quickly, but it’s not a lifelong solution.

“Medicare pays full coverage for the first 20 days and partial payment for days 21 to 100. After day 100, they don’t pay anything,” says Michael Leitson, Senior Data Manager at American Health Care Association, a federation of 50 state health organizations representing 12,000 nursing homes and assisted living facilities.

Learn more about Medicare’s coverage and some additional benefits of the program.

Does Medicaid pay for nursing homes?

Medicaid is a state and federal program that covers medical costs for people with limited income and resources. Unlike Medicare, Medicaid pays for nursing home care if you qualify. While eligibility requirements differ by state, the American Council on Aging created a free Medicaid eligibility test to determine who may qualify for financial assistance for long-term care.

Most, but not all, nursing homes accept Medicaid. To learn more about nursing home care Medicaid benefits and eligibility, contact your state’s Medicaid office.

Does the VA pay for nursing home care?

The U.S. Department of Veterans Affairs does provide nursing home care to veterans who require long-term care in their community. Vets must meet enrollment and eligibility requirements, which are based on:

  • Income
  • Disability level
  • Service-connected status

Additional considerations for care include:

  • Individual is signed up for VA health care
  • The specific service will help with ongoing treatment and personal care
  • The service or care setting space is near the recipient

The VA also provides a pension, which is a tax-free monetary benefit for war-time veterans who are:

  • Age 65 and older
  • Permanently disabled or living in a nursing home
  • Receiving Social Security Disability Insurance
  • Receiving Supplemental Security Income

To access VA services or ask questions, contact your VA social worker. You can also call toll-free at (877) 222-8387.

Bridge loans

A temporary, but quick financial option is an Elderlife bridge loan. This short-term loan can be used to pay for a move to a skilled nursing facility or nursing home while assets are being liquidated, or while a home is being sold. It’s particularly helpful when families need funds for care quickly. Additionally, it allows up to six individuals to apply or share responsibility for a senior loved one’s care. To learn more about this loan, contact Elderlife Financial Services.

Private pay sources for nursing home care

Private pay is a common funding source for nursing homes. Many families finance care using:

  • Savings
  • Pension
  • Retirement income
  • Stocks
  • Home equity, including selling or renting a home
  • Assistance from family

Long-term care insurance

If you’ve purchased a long-term care insurance plan, there’s a good chance you can receive funds to cover nursing home care costs. Most nursing homes are categorized as custodial care, and long-term care insurance is designed to pay for custodial care as well as personal care. However, policies and benefits vary by plan.  

Another potential funding source is private health insurance policies. Depending on your policy, some nursing home care may be covered. 

Seek personalized advice or assistance

Finding sources or ways to pay for nursing home care can feel overwhelming. Consider speaking to an elder law attorney or a certified financial advisor who specializes in long-term care financing.  

Merritt Whitley
Merritt Whitley
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