How to Pay for Senior Care

Where can you go to finance hired in-home help for your senior? There are a number of ways to pay a caregiver provided you follow federal and state tax, wage, and labor laws. Often times, families will use a combination of methods to fund in-home care for their elderly loved ones.

You may want to consult with a qualified elder law attorney to determine benefits eligibility and to make sure you’re following state laws that dictate the treatment of income and assets. To find an attorney, you can search the National Academy of Elder Law Attorneys’ website.

Here are six ways to pay for senior care:

1. Personal Income and Assets

If the senior has sufficient income and assets, they are likely to pay for their own long-term care needs out of their private resources. Once these resources are depleted, Medicaid may help pay for care. As more and more seniors desire to “age in place” rather than move to a nursing home or assisted living facility, they’ll spend their income and assets on in-home care.

A conversation with your senior about their financial situation should take place early on in the process. You’ll need to determine whether or not they can contribute to their care and, if not, who will assume financial responsibility.

2. Family Resources

Wealthy families may look to their own bank accounts, stocks or retirement funds for resources to pay a caregiver for their senior. They may also sell a vacation or second home in order to free up funds.

However, this is not an option for many families who may not earn enough money or hold enough assets to make this work. They also may still be supporting their own children, which makes it even more difficult to financially support a senior caregiver.

Besides paying for a caregiver, a family has other ways to support their elderly loved one. They can have the senior move into the family’s home. A family member could also cut their work hours in order to take care of the senior, which could eliminate the need for senior care or reduce the number of hours a caregiver is needed.

3. Private, Long-Term Care Insurance

While private health insurance policies support medical treatments in various facilities (including the home), they may not subsidize personal care assistance or in-home caregiving.

That’s where long-term care insurance (LTC) enters the picture. LTC insurance covers the costs of long-term care services, like personal care assistance, that may not be covered by health insurance, Medicaid or Medicare.

LTC policies offer a great deal of choice and flexibility with a range of care options and benefits that can suit the needs of your senior.

However, an LTC policy needs to be purchased before the senior needs care. Actually, it should be in place before the senior is technically a senior. The average age to buy LTC insurance is now 57. You may also be able to purchase LTC insurance through your employer. This type of policy will cover you, your spouse, and potentially your parents.

4. Medicaid

Medicaid can be used to cover the cost of home care when the senior can no longer care for themselves. Although poverty alone doesn’t necessarily qualify someone for Medicaid, it is the largest source of funding for medical and health-related services for people with limited income. Each state determines its own parameters for Medicaid benefits so it’s important to understand what may be available in the state where your senior lives. The individual must also meet strict financial and other eligibility requirements.

5. Medicare

Medicare is a federally funded social insurance program that provides health insurance coverage to people who are age 65 and older and others who meet special criteria. Very few people qualify for home health care coverage. If they do, it’s extremely limited. As this type of home care must be provided by a Medicare-certified home health agency, Medicare is not an option for families hiring nonmedical in-home care on their own or using a referral or placement agency to find care.

6. Veterans Benefits

The Aid and Attendance benefit offered through Veteran Affairs (VA) can help pay for care in the home as well as a nursing home or assisted living facility. Veterans, veteran spouses, and surviving spouses who are eligible for a VA basic pension may be able to receive financial support to pay a caregiver at home. The caregiver can be someone who assists with basic needs like eating, bathing, and dressing.

For more information on how to pay for senior care and other issues related to hiring in-home help, check out How to Hire a Caregiver for Your Senior: Your Complete Guide to Finding, Employing, and Retaining In-Home Help. Learn more and download two free chapters or purchase on Amazon.

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