Who Pays for a Nursing Home?
Out of Your Pocket
Nearly half of all nursing home residents pay for their care out their own pockets. In 1996, private payments for nursing home care reached just over $30 billion. Half of all residents are discharged within three months while one in five are there for more than a year but less than three years. If an individual stays for a long period of time and spends all of his or her savings, that person usually becomes eligible for Medicaid.
Medi-Gap or Medicare Supplemental Insurance
Chances are your parents have been paying for a supplemental insurance policy to their Medicare. These policies are commonly referred to as Medi-gap policies because they fill in the gaps between what Medicare pays and whatever is the actual bill from a doctor or hospital. They will also help with the gap between what the nursing home charges and Medicare pays. But remember: At the most we're talking a 100 days of care if Medicare covers it. These Medi-gap policies do not pay the full bill.
Veterans Nursing Homes
My dad, a World War II veteran, calls me at least twice a year when he's paying his Medi-gap insurance policy and asks me, “Are you sure I need this? Can't I just go into the Veterans Home and then I won't have to pay anything?” And I always say, “No, Dad. There are millions of veterans out there just like you. There simply aren't enough beds. You have to qualify to get in and they're looking for people with pretty low incomes.” Even though the Department of Veterans Affairs provides long-term care services for thousands of veterans, it isn't free. See VA Health Care Benefits Package.
Medicare Managed Care
If your parent has opted out of the traditional, fee-for-service Medicare and into a Medicare managed-care plan, you should know that the managed-care organization must offer your parent the same benefits as those offered under traditional Medicare. This is the minimum the managed-care plan must provide. Check with your parent's plan to see if it covers anything more than the minimum.
There are 131 Veterans Administration-run nursing homes in the country. To find out about one near you and if you are eligible, call 1-800-827-1000.
Medicaid Waiver Programs
Most states have received waivers from the federal government to offer people who qualify for Medicaid and are certified as eligible for nursing home care a choice to either go into a nursing home or remain at home. If someone chooses to stay at home, the state will pay a large portion of the home health care and medical services your parent will need. Every state has its own set of rules. Call your local area agency on aging to find out how to qualify.
So there you have it. If you've learned anything, I hope it's that you are no longer among the misguided who think that Medicare covers your parent's nursing home stay.
Your entire family—parents and siblings—should have a serious discussion on how to financially prepare for nursing home care. If your mom is 85 years old, she has a 5050 chance of needing nursing home care. With those kinds of odds and the level of expense we're talking about, you can't afford to go merrily along hoping for the best. Some families are pitching in to buy long-term care insurance for their parents while they're in their 60s when it's more affordable. It's not such a high bill to pay when three or four family members are sharing in the cost.
More on: Aging Parents
Excerpted from The Complete Idiot's Guide to Caring for Aging Parents © 2001 by Linda Colvin Rhodes, Ed.D. All rights reserved including the right of reproduction in whole or in part in any form. Used by arrangement with Alpha Books, a member of Penguin Group (USA) Inc.
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