Who pays for LTC?

1 Individuals pay for LTC from their savings, selling their assets like stocks, bonds, CD’s, mutual funds, and in many cases selling their home in order to pay for their LTC needs. 

2 Medicare provides very limited coverage when it comes to LTC.  Medicare provides a maximum of 100 days of LTC coverage. It only pays for medically necessary “skilled care” when the majority of persons receiving home and nursing home care need services classified as “intermediate or custodial care,” which is not covered by Medicare.  According to the Health Care Financing Administration, the average number of days that Medicare pays is less than 25 days. That is why the most recent studies show that only 6% of long-term expenses qualify for Medicare.  Medicare is not the answer to the LTC dilemma.

3 LTC insurance provides an excellent alternative to financing long-term care needs.  You pay premium today for the insurance company’s promise to take care of your ongoing and larger bills later. The basic ingredients in determining your cost are your health and age. The younger you are the lower the premiums are. There are other factors such as amount of coverage, length of time, etc. that enter into the final insurance premium.

4 Medicaid is often the last resort.  When personal funds are exhausted and family members are not able to provide care, Medicare is the only other option.  You have to meet the individual state guidelines for qualification to enter this program.  Not all nursing homes accept Medicaid payments.  As a result, the nursing home you go to might not be of your choice.  Nursing homes accepting Medicaid generally have three or four to a room. With Medicaid, you take what you can get in order to have your expenses covered.