Question :: Who Pays for Long Term Care

Senior Assets at Twilight

My father is 67 years old, mortally obese and has less than $75,000 in assets. If he needed long-term care and ran out of his $75,000 in assets, who pays for his care? Will the care facility or the government come after me and my brother to pay for his care?

This question comes from Quora, a question and answer website.

A: Control your senior assets to eliminate debt

This is a question that is often asked too late, well after a loved one is placed in long term care. In the event your father is placed in long term care at the direction of a doctor, he will qualify on 2 out of 3 indicators for Facility Medicaid.

Continue reading “Question :: Who Pays for Long Term Care”

Case Study Idaho :: Ramona

Ramona, Idaho, has ancestry in Basque region of Spain.

Limited Savings and Family Far Away

The Stroke

Ramona is an 87 year old, 2nd generation from Spain.  She had been living alone in her home for the past seven years since her husband passed away in his sleep.  Ramona suffered a stroke while her daughter, Sofia, and family were visiting for Easter.  The physical consequences from the stroke necessitated Ramona be moved from the home to Long Term Care in her hometown of Boise, Idaho.

Finances

Ramona and her late husband, Ernst, have modest savings.  $10,000 is in a savings account as a modest fallback plan.  She receives $1,221 a month from social security after working most of her life in an Inn.  Ramona owns her home and a low mileage Volkswagen.  Ramona’s daughter, Sofia, and her husband live in Manhattan, Kansas.  At 66, they have just recently retired and now only occasionally work at the Flint Hills Discovery Center.

The Story

Ramona entered long term care on the 19th of April, at a nice run of the mill facility.  She has a semi-private room due to costs.  Her monthly bill comes out to $7,452.  The cost just to move in brings Ramona’s savings to $2,5 48.  Sofia and her husband recognize that the cost of care will be more than the social security benefit, so they decide to sell the car and list the house.  The car sells quickly and brings in $7500.  With another month of social security and the gains from the car, Ramona and her family are able to pay for another month. Continue reading “Case Study Idaho :: Ramona”

Tools for a Medicaid Spend Down

A car is an approved item on a medicaid spend down plan

How do I meet the financial requirements?

This is known as a “spend down” and will result in meeting the income and asset requirements to apply for Facility Medicaid.  There are several tools available to qualify for facility Medicaid that sets your family up for a better financial position rather than just spending all the income on long term care.  Below are just a few of the approved methods to complete a medicaid spend down to qualify for facility medicaid.

Home Repairs

If you own a home and intend to return to it, or have a spouse that will remain home, you can make repairs or modifications without penalty.  You could update a bathroom or kitchen, put on a new roof, build an addition, or make any repairs to improve a single house.

Bills (Current or Future)

In order to qualify for facility Medicaid you will never have more than $2000 or a monthly income.  Credit card bills, vehicle loans, mortgage payments, and any outstanding bills are eligible as part of a Medicaid spend down.  It is a good idea to get bills out of the way before moving on to other parts of the spend down.  In addition, if your loved one is only going to be in long term care for less than a year before returning home, you can go ahead and prepay mortgage and car payments so they don’t lose those while in long term care. Continue reading “Tools for a Medicaid Spend Down”

How do I Qualify for Facility Medicaid

Qualify for Medicaid Chess

How do I Qualify for Facility Medicaid?

There are several criteria that need to be met to qualify for Medicaid.  If you have a loved one that needs to be admitted to Long Term Care, you should be able to qualify for facility Medicaid.  The conditions to qualify for Medicaid are listed below.  Eligibility begins on the date a client meets all three criteria.

  • Institutionalized level of care for 30+ consecutive days. (Hospital or Nursing Facility)
  • Aged 65+ OR has been determined blind or disabled
  • Meets the financial requirements

Once you have determined that a loved one needs to be admitted to Long Term Care, the process of qualifying financially can begin. Continue reading “How do I Qualify for Facility Medicaid”

How will you Pay?

How will I Pay for Care?

When you look at the chart below, it is evident that long term care is financially demanding and will cost around $90,000 a year.  The daily rate for long term care in Colorado can vary from $173 to $650.  While there are a wide variety of prices depending on your location, you can use the chart above to get a general idea of how to pay for long term care overall.  While there are options for paying for long term care, the most common ways are Private Funds, Long Term Care Insurance, and Facility Medicaid.

90000 avg rate in CO

Private Funding

Less than ⅓ of folks pay for long term care with their own money.  Many people will pay a portion of their long term care with private funds until they qualify for Facility Medicaid.  If you have invested heavily or continue to receive an income of over $90,000 per year, you can probably pay for Long Term Care with your personal income.  

Long Term Care Insurance

An option for people trying to plan ahead is Long Term Care Insurance.  These policies reimburse policyholders with a daily amount to cover the cost of assisted care or long term nursing facilities.   The cost of long term care insurance varies based on several factors including age (outlined below as questions you should ask).  If you or your loved one holds long term care insurance contact your insurance agent for personalized assistance with your situation.  Ask the following questions to get help with making decisions:

Questions for Long Term Care Insurance

  1. What is the maximum amount the policy will pay per day?
  2. What is the maximum number of days/years the policy will cover?
  3. What is the lifetime maximum the policy will pay?
  4. What optional benefits were included with this policy?

Facility Medicaid

Facility Medicaid is a government program to pay for long term care for those that are unable to afford the cost on their own.  2/3 of patients in long term care are able to do so with facility Medicaid.  Even if your loved one exceeds the income requirements for facility Medicaid, it may be in the family’s best interest to spend down and qualify.  With facility Medicaid you must have a monthly income of less than [$2199/month] and total assets of less than [$2000].  You are able to keep one house and one vehicle and still qualify for facility Medicaid.  This is also a great option to protect assets for a spouse that will not be in Long Term Care.

If you are in a situation where you have a loved one in need of long term care, please read this whole document to discover how qualifying for facility Medicaid can be done.  This document is provided primarily to explain facility Medicaid and provide a support to those worried about the care for their loved ones.