For your loved ones who cannot properly care for themselves alone, a nursing home can be a safe, comfortable place for them to live. But how much do you know about nursing homes, and how can you plan for the possibility of using one?
When asked, most people will say that long-term care planning is important — but few people have actually done it. This is likely due to the fact that planning for the possibility of a nursing home, whether it is for yourself or for a loved one, simply isn’t a pleasant topic. Most people would rather put it off instead of dealing with it now.
The good news is that there are some easy ways to prepare for the possibility of a nursing home. But first, let’s look at some facts that you may not know about nursing home care costs.
#1: Medicare Won’t Pay for Long-Term Care
While many people are under the impression that Medicare will cover their long-term care costs, it won’t. Medicare only covers short-term acute care. This means that while Medicare might fund your short-term nursing home stay post-surgery, it won’t pay for you to stay there beyond your recovery.
#2: Medicaid May Force You Into a Nursing Home
Unlike Medicare, Medicaid actually does cover long-term care. The problem with relying on government benefits, though, is that you are only covered for a nursing home, even if you could easily live in a more freedom-centered assisted living facility. While there’s nothing wrong with nursing homes, it’s not ideal to be boxed into that option if you don’t really require that level of care.
#3: Nursing Home Care Costs are Extremely High
Obviously, the cost of nursing home care varies by region, but according to senior living referral service A Place for Mom, the average cost ranges from $4,000-$8,000 per month — and even at that price, you or your loved one may be sharing space with a roommate.
How Can You Plan for Long-Term Care?
If you’re starting to panic about the cost of nursing homes, don’t! There are plenty of options for long-term planning, such as:
- Life insurance with an acceleration rider. This allows a portion of your life insurance policy to be paid toward long-term care expenses each month.
- Stand-alone long-term care insurance. You pay a monthly premium for coverage, and the policy only pays out if long-term care is needed. Otherwise, it pays nothing.
- Annuities with a long-term care rider. Similar to the life insurance option, this allows a portion of your annuity to go toward long-term care.
- Hybrid life/long-term care products. These combine life insurance with a rider that pays out the death benefit in advance, which can be used for long-term care.
- Elderly trusts. Some states allow special needs trusts for those 65 and older. These take the “spend-down” amount required for Medicaid eligibility and hold them in a trust, allowing Medicaid to pay for nursing home care while the trust assets pay for the supplemental needs of the person in the nursing home.
Alabama Family Trust is Here to Help!
While we don’t specialize in nursing home information, we do establish and administer elderly trusts — and we can answer your questions regarding long-term care for yourself or your loved one. Contact us today for more information!