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Paying for Long Term Care

Long-term care costs can be quite expensive and are dependent upon a few things: the amount, type of care provided and where you receive it. Costs for long-term care will vary from state to state. There are a variety of ways to pay for long-term health care:

  • Personal Resources - Individuals may choose to use their own personal resources to pay for long-term health care, although this isn't the best method. Some people may pay from their personal current income, others may use their savings and investments and some may sell their assets, like their home, to cover their long-term care needs.
  • Relying On Family - When an individual does not plan ahead for long-term care, he or she may have to rely on their own family members to pay for or deliver care. If the family is unprepared to pay and does not have enough for long-term care, this situation can be a burden on the family for many years. Long-term care can be very expensive and take years to pay off. It is very important to plan ahead for long-term care so that if or when you need long-term care, you won't be a burden to your family.
  • Medicare - covers very little of the cost of long-term care services that most people need. Medicare will pay for up to 100 days of care in a skilled nursing facility, after you have been hospitalized for at least 3 days. Medicare covers the first 20 days entirely and the patient pays a daily coinsurance after the 21st day. Medicare don't pay for intermediate or custodial care - the type of care most often needed by people who cannot care for themselves at home and must move to a nursing home.
Coverage
Days 1 - 20 Covers 100% of approved services
Days 21 - 100 Covers 100% of approved services after Medicare daily deductible
Days Over 100 Covers 0%
  • Medicaid - is a joint federal/state program that pays for health care for people with limited income and resources. Unlike Medicare and other federal programs, Medicaid does pay for custodial nursing home care. Each state sets its own standards for Medicaid eligibility, determines the type of service provided and administers the program under broad federal guidelines. These rules are complex and vary from state to state, so check with your state Medicaid office to learn about the rules in your state.
  • Veterans Administration Benefits - many larger VA hospitals offer extensive long-term care services, while services at smaller facilities may be limited. Eligibility for VA services depends on many factors, including total family income, length of service and whether or not the veteran has a service-connected disability. All veterans, however, are eligible for an initial physical examination and screening. Contact the nearest VA hospital to determine eligibility since not all veterans are eligible for VA benefits.

    Legislation was signed into law on September 2000, that provides a group plan for long-term care insurance for all active and retired federal civilian employees and active duty uniformed service members, retirees and their families. Because of the large group buying power, rates are expected to be reduced by 15-20 percent below the rates of commercial plans. However, the new program will take up to two years to be implemented and will be available to federal employees in October 2002.

Related Links

Long Term Care Insurance

Paying for Long Term Care

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