Planning for Long-Term Care: Understanding Your Financing Options

Long-term care is a range of services and support for people who need assistance with daily activities due to chronic illness, disability, or aging. This may include help with bathing, dressing, eating, and medication management, among other things.

The cost of long-term care varies depending on the type of care needed, the location, and other factors. According to a 2020 study by Genworth, the national median cost of a private room in a nursing home was $102,200 per year, while the median cost of a home health aide was $54,912 per year.

There are several financing options for long-term care, including:

• Private pay
• Long-term care insurance
• Medicare
• Medicaid
• Veterans benefits

It’s important to plan ahead and explore your options before you need long-term care.

Long-term care insurance is a type of insurance that helps cover the costs of long-term care services, including nursing home care, assisted living, and home health care. It can be purchased from private insurance companies and may cover some or all of the costs of long-term care, depending on the policy.

Medicare is a federal health insurance program for people who are 65 or older, or who have certain disabilities or medical conditions. It may cover some limited costs of long-term care, such as skilled nursing care in a nursing home, but it does not cover custodial care, which is assistance with daily activities like bathing and dressing.

Medicaid is a joint federal and state program that helps cover the costs of medical care for people with low incomes and limited resources. It may cover some or all of the costs of long-term care, depending on the state and the individual’s financial situation. Eligibility requirements vary by state.

Veterans benefits for long-term care may include coverage for nursing home care, assisted living, and home health care. Eligibility requirements and benefits vary depending on the veteran’s service record and other factors. Veterans and their families can contact the Department of Veterans Affairs for more information.

When planning for long-term care, it’s important to consider your financial situation, your health and medical history, and your personal preferences for care. You may want to consider purchasing long-term care insurance, creating a financial plan for long-term care, and discussing your wishes with your loved ones.