How to Pay for Long-Term Care
According to the Genworth Financial Cost of Care 2015 Survey, the average cost of a one-bedroom unit in a Pennsylvania personal care residence or assisted living residence is $42,660. For care, the skilled nursing facility, median annual cost is $113,150. If you are looking for care for yourself or a loved one, you must understand how you are going to pay for it.
Many people believe – wrongly – that Medicare, Social Security or Medicaid will pay for their long-term care needs. Medicaid does cover skilled nursing facility care for the impoverished, and Medicare may cover some of the cost of skilled nursing facilitycare for those who require short-term rehabilitation, but both require individuals to meet certain physical and medical standards. And generally speaking, neither covers the cost of personal care/assisted living.
The following sections are designed to help you understand how you can pay for care – privately or through government programs. But if you or a loved one are considering long-term care, we recommend that you also talk with someone who can help you to understand your own financial situation, such as a hospital discharge planner, your local Area Agency on Aging office or county’s Medical Assistance office. It is also recommended that you talk with an elder law attorney, who can help you understand how to best manage your assets.
Most personal care home residents, and roughly 20 percent of skilled nursing facility residents, pay for costs out of their own savings and assets. Frequently, when people enter a skilled nursing facility for extended long-term care, they first pay for their care out of their own assets and then expend their resources and apply for Medicaid.
For the most part, private medical insurance does not cover the cost of personal care or skilled nursing facility care except in specific circumstances.
Long-term care insurance can be purchased to provide some payment for skilled nursing facility care and care in an assisted living residence or personal care home. Read more about long-term care insurance.
Some Medicare supplementary insurance policies, often referred to as “Medigap” insurance, also may provide some limited payment. Many health maintenance organizations (HMOs) and other coordinated care plans participate in the Medicare and Medicaid programs. These health-care plans often cover certain benefits in addition to those required by Medicare and Medicaid and are experienced in “coordinating” a member’s health care. Some HMOs may also offer more medical or supportive services; others may not require a hospital stay before approving a skilled nursing facility admission.