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“Don’t Go
Broke Paying for Senior Care”

Ask an aging parent or loved
one where they want to be living in their remaining years and chances are
they’ll respond with “right here, at home!” While it’s true most seniors prefer
their own home for “aging in place”. Memories, personal belongings,
familiarity, and comfort are all reason enough to want to remain home. However,
for many families, affordability is a huge factor when deciding senior care
options for mom or dad. How will we afford this? Does the government pay?

Medicare does not pay for
home care assistance or “personal care”. A great majority of individuals must
rely on personal income and resources to pay for senior care. Fortunately, home
care is much more affordable than most people think. According to a recent
survey, most families overestimated the cost of home care services by $6.00 an
hour. To start determining your own long-term care plan or your loved ones,
let’s explore all the possible options.

Family Provided Care: If family members are willing and able to devote the
time and energy required for care, their help can greatly reduce cost,
especially when combined with assistance from a home care agency. But keep in
mind, an untrained family member may not be able to provide the level or type
of care that is needed. In addition, this shift in the role from “family
member” to caregiver can often strain family relationships. Many older adults
prefer not to burden family members. If you plan to have family members help be
sure to have frank conversations now and on an ongoing basis.

Long Term Care Insurance: Long-term care insurance
may provide a high level of coverage depending upon the policy benefits but it
can get expensive particularly for older adults. As a general rule, the sooner
you enroll, the lower your premiums will be. Existing health conditions may
disqualify you, and a medical screening will be required. If your parent or
loved one has a Long-Term Care Policy, be sure to review the policy thoroughly,
including the maximum benefits, elimination process, and requirements of agency
or facility. It is a good idea to give the Long-Term Care Company a phone call
prior to starting a claim and gather all the necessary information you will
need to begin.

Medicare or
Other Health Insurance

While
Medicare and other health insurance policies may cover medically necessary care
provided in a skilled nursing facility or in the home after a major medical
condition or event requiring a hospital stay, neither method covers ongoing
personal care or home care, including help with essential daily activities.

Medicaid: Medicaid covers long term
care only for those who meet strict state-specific financial eligibility
requirements. Personal investments and assets must be almost completely
exhausted before Medicaid can be accessed. Even when that’s the case, Medicaid
covers services only from a list of approved providers. If relying on this
option, be sure to look into the types of providers and facilities approved by
Medicaid to be sure these are acceptable to you.

Life Insurance: Some insurance companies offer long-term care
additional riders for life insurance policies. Other options may enable you to
use your life insurance policy to help pay for long-term care. Accelerated
death benefits and viatical settlements (selling your policy to a third party)
provide payments lower than the full value of the policy, but can make sense
for those who are terminally ill or in poor health. A life settlement
essentially sells your life insurance policy for its present value—often a wise
choice for those who no longer need or want a policy.

Veterans Aid and Attendance
Benefit: The VA Aid and Attendance
program is designed to provide monetary assistance to those veterans and
surviving spouses who served our country during a time of war and are now in
need of aid or assistance with activities of daily living. This aid or
assistance can be provided at home, in an assisted living facility, or a
nursing home. To
qualify for the Aid and Attendance Benefit, the veteran will have at least 90
days of active duty, but need not have served in combat, one day of active duty
during a period of war, honorable discharge, physician note stating the need
for assistance, and financial qualifications must be met. This tax-free benefit
pays up to $1,644 per month for a single
veteran.

Other
Options: Long
term care annuities, the sale of a home, and personal savings are sound funding
options for many.

It is important to start the
financial planning process now, get a clear view of your loved one’s situation,
and take time to investigate all options and funding sources.