What does Medicare cover for Nursing Homes?

Jackie Bedard
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Medicare is a federal insurance program that provides health insurance to people, including many North Carolinians, over the age of 65, no matter their income. The program also serves younger disabled people, kidney dialysis patients, and individuals with Lou Gehrig’s disease.

Will Medicare cover my nursing home expenses? 

A nursing home is a facility that provides short-term and long-term care to people who cannot be cared for comfortably at home. This could be due to physical, emotional or mental problems. Staff members at the facility may assist patients with bathing, dressing, eating and other daily activities.

The unfortunate reality is that Medicare will only pay for a nursing home in very limited circumstances. According to Medicare policies, the insurance program will pay nursing home charges under these conditions:

  • the care is considered medically necessary;
  • the facility care is only needed for a limited period of time;
  • the care is provided by a Medicare-certified, skilled facility that is qualified to provide rehabilitation therapies; and,
  • the patient enters the nursing home after a qualifying inpatient hospital stay of three days or more.

These restrictions make it difficult for elderly people to qualify for nursing home care under Medicare. In condition three, for instance, the facility must be designed to manage, observe or treat your medical needs after a hospitalization. The more traditional nursing homes that provide day-to-day, non-medical care are therefore not covered by Medicare.

How much will Medicare pay?

Medicare currently has a tiered payment system for skilled nursing home facilities. For days 1 through 20, the program will pay the full cost of covered services. This includes a semi-private room, meals, medications, medical supplies, dietary consulting and rehabilitative care. For days 21 through 100, you are required to pay a co-payment and Medicare will cover everything else.  The amount of the co-payment changes annually. After day 100, your Medicare coverage will no longer apply and you will be forced to pay for the full cost of the services.

How else can I pay for a nursing home?

Long-term Care Insurance

This is a private insurance plan that supplements your normal health care insurance. It will often pay for both skilled and non-skilled custodial care. Long-term care insurance plans can vastly differ. Some plans will only cover nursing home care, and some plans will cover everything from assisted living facilities to in-home care. Today the average cost of a long-term care insurance policy is $3,335/year for a healthy couple in their 60s.  Although many may feel that the cost of long term care insurance it high, the annual cost of long-term care insurance is typically far lower than the monthly cost of long term care (for example, assisted living facilities in the Cary-Raleigh area may cost in the range of $3,500-7,500+ per month and skilled nursing facilities in the Cary-Raleigh area may cost in the range of $7,000+ per month).

Personal Resources

You can use your personal savings to pay for a nursing home. It is important to note, however, that the average yearly cost of a nursing home today is $75,000. Paying for a nursing home out-of-pocket can quickly drain your savings, and may severely impact financial planning for your loved one’s needs should they arise in the future.

Medicaid

Medicaid is a government run assistance program that assists people of every age. If you have already exhausted your savings and assets, you could potentially qualify for Medicaid assistance coverage for your nursing home care. Additionally, if a majority of your assets are owned by an asset protection trust, then you also may qualify for Medicaid benefits.

 

Additional Information on North Carolina Medicaid Assistance for Nursing Home Care:

Download a free copy of Jackie Bedard’s book, The Ultimate Guide to Paying for Nursing Home Care in North Carolina, to learn the nursing home and Medicaid secrets you need to know to avoid going broke in a nursing home and leaving your family penniless.