Long-Term Care

Many people have health insurance, provided by an employer, a retirement plan, through Social Security, or purchased individually. Such insurance does not usually cover long-term care, that is, custodial as opposed to acute medical care. Medicare does cover nursing home expense for a maximum of 100 days with a co-pay after the first 20 days, but only if the stay is for rehabilitation.  If the stay is or becomes custodial, either before or after the 100 day period covered by Medicare has run, Medicare will no longer pay for this care; instead, either long-term care insurance or Medicaid is needed.

Several insurance companies offer long-term care insurance. Such policies offer varying forms and extents of coverage and are only available if a person is deemed eligible. The cost of the policies increase with age and benefits.

The general rule is that a person must pay for the cost of his or her long-term care out of his or her own funds. When that person becomes impoverished in accordance with government guidelines, he or she becomes eligible for Medicaid. Once eligible for Medicaid, the government pays for all expenses above a contribution by the recipient of his or her income, for example, pension and Social Security benefits.

The rules for qualification for Medicaid are complexing and frequently changing.

There are a number of techniques which may be appropriate for planning for the payment of long-term care. The earlier any planning is implemented, the more likely it is to be successful.

It may be possible to protect some of a person’s assets even after entry into a long-term care facility.