Paying for Long-Term Care
By Lori A . Leu , Erin W . Peirce , Lauren E . Olson , and Laura J . Chavero
Long-term care in the United States is currently one of the most uncertain issues faced by seniors . Several factors contribute to this uncertainty : Americans are living longer than ever , the cost of long-term care continues to rise , and ongoing political battles continually result in new legislation affecting governmentfunded programs . Today , the oldest Baby Boomers are already in their 70s , and by 2030 , one in five Americans will be older than 65 . Considering that some studies show that 36 % of Baby Boomers plan to rely only on Social Security as their retirement income , these programs may be the only means they will have to pay for health care and long-term care . While no one can predict the future , becoming educated about the reality of public benefits and long-term care costs can help ensure you and your loved ones will be protected .
One of the greatest myths is that Medicare will pay for all our health care needs : “ I want to stay at home as long as possible and when I get sick , Medicare will pay for it . And , if that runs out , I ’ ll just be a ward of the State .” This misconception about Medicare and the “ State ” handling long-term care prevents many seniors from pursuing the planning assistance that they need .
In general , Medicare is health insurance for people aged 65 and older or who meet certain disability qualifications , and who paid Medicare taxes through payroll deductions for a sufficient period of time ( or who qualify through a working spouse or parent ). Contrary to popular belief , Medicare does not pay for assisted living or custodial care in a skilled nursing facility . At most , traditional Medicare and a
Medicare Supplement ( MediGap ) policy will cover 100 days of rehabilitation in a skilled nursing facility . Medicare Advantage plans cover much less . Thus , the patient must secure payment for ongoing long-term care .
There are essentially three ways to pay for long-term care :
• Private Pay – Some people are fortunate to have the ability to pay for their own long-term care , which currently ranges from $ 3,000 - $ 7,000 / month or more in the Dallas-Fort Worth area .
• Long-Term Care Insurance – Long-term care insurance policies are improving and are becoming the option of choice for many people . Newer policies allow for coverage of care provided in all types of settings , including home health , assisted living , and skilled nursing , thus providing some independence and flexibility . The cost of long-term care policies can rise quickly for people who are older , those with existing health problems , and those who desire broader benefits . Therefore , the earlier you apply and the more you shop around , the better your policy may meet your needs .
• Government Benefits
• VA Pension – The levels of veterans ’ benefits vary depending on an individual ’ s needs . These
benefits are limited to veterans ( and their surviving spouses ) who served a 90-day continuous period in the military , at least one day of which occurred during a wartime period , and who were honorably discharged . The program is needs-based , so income and assets must be evaluated to determine eligibility .
• Medicaid – This encompasses federally funded , state-managed programs that are needs-based , with strict limitations on income and assets , but with exceptions that are important to consider . Eligibility requirements and services covered vary widely from state to state . Providing advice on Medicaid eligibility includes the interpretation of statutes and administrative rules and constitutes the practice of law under the rules of the Texas Health & Human Services Commission . Only attorneys are legally allowed to provide assistance with Medicaid eligibility . While there are several non-attorney individuals and companies who try to provide this assistance , Medicaid applicants should beware . These persons are operating illegally , often charge more than attorneys , and are within the realm of those who are preying on seniors for their own financial gain .
How will you pay for long-term care needs that lie ahead ? Making smart decisions now ensures that when the time comes , you will be able to afford the quality and level of care you need . For a better understanding of your funding options for longterm care and to find an Elder Law attorney in your area go to www . naela . org .
Lori , Erin Peirce , Lauren Olson , and Laura Chavero are Elder Law attorneys with Leu & Peirce , PLLC in Plano , Texas . They can be reached at 972-996-2540 .
COLLIN COUNTY Living Well Magazine | MAY / JUNE 2016
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