It is a common belief that Medicare will cover absolutely everything you need, regarding healthcare expenses, during retirement. But that unfortunately is not true. While Medicare does pay for hospitilization, doctor appointments, and some medical supplies, the cost of a nursing home is usually outside of the scope of coverage. So most people who enter a nursing home must find some other way to pay for it. But how?
Out-of-pocket. Some individuals simply pay for nursing home care out of their own pocket. But with nursing homes costing a few thousand per month, the bill might exceed your monthly income. In some cases a retirement account could be quickly drained when nursing home care is required.
Medi-Cal (Medicaid). While Medicare does not generally cover nursing home care, Medi-Cal might. The government-sponsored program helps with medical expenses for people of lower income status, so even if you don’t qualify for Medi-Cal when you first move into the home, you might qualify later when your financial status changes.
It’s a good idea to make sure the nursing home you choose will accept Medi-Cal payments, in the event that you self-pay but suspect you might qualify for Medi-Cal later. Because states use different metrics to determine Medi-Cal eligibility for those who reside in nursing homes, it certainly can’t hurt to apply for help.
Long-term care insurance. If you were proactive enough to think ahead, a long-term care insurance policy offers the obvious solution to the long-term care dilemma. Purchasing a policy before you retire, and younger if possible, helps you to lock in lower premiums. Some long-term care insurance policies cover nursing homes only, while others might provide for in-home services, adult day care, and other options. Compare policies, and choose one that provides for the type of care you think you might prefer.
Life insurance. Some cash value life insurance policies carry a rider that allows you to withdraw funds for expenses such as nursing home care. Check with your life insurance broker about your own policy to see what might be available to you.
If you’re concerned about the potential cost of nursing home care, give us a call. We can help you explore your options so that you hopefully won’t have to worry about this expense now or in the future.