Paying for Assisted Living

Transcription

1 Paying for Assisted Living A Guide for Seniors and Loved Ones the STRATFORD at Maple Leaf the STRATFORD at Maple Leaf Lake City Way Northeast Seattle, WA (206)

2 Table of Contents What is the Cost of Assisted Living?... 3 Long Term Care Insurance... 3 Medicaid... 4 Medicare... 5 Life Settlements... 5 Home Equity... 5 Aid and Attendance Veterans Benefit

3 What is the Cost of Assisted Living? The cost of assisted living depends on: the service needs of the resident size of the living unit location of the community amenities offered Generally the cost is less than nursing home care and home health services. Most assisted living costs are paid by private funds, and there are various financial options available to families and individuals. Long Term Care Insurance This is a private insurance option that covers various types of assisted living. It may include long-term care provided by professional or non-professional caregivers. Since this form of insurance is privately operated, levels of coverage can be dramatically different, depending on whom you buy from. Some companies will only pay for care in a nursing home. Other choices will help in both official and unofficial care giving situations. They may offer compensation for equipment, in-home care, and other services as well. Prices can vary quite dramatically. Your health, age, and level of coverage all have an impact on premiums. It is also possible that a health condition could make you ineligible. For these and other reasons, it is wise to buy long term care insurance at as young an age as possible. This improves your eligibility and lowers your costs. You should review your policy on a regular basis in order to make sure it still meets your current needs. There are many factors involved, so it s a good idea to speak with a financial adviser or an impartial insurance agent. 3

4 Just as premiums vary, so do the costs of care. Where you live can have a tremendous impact on price, so it s always important to make sure your insurance is actually enough to cover these costs. It isn t the insurance company s responsibility to meet these minimums. Most of these care plans come with tax benefits. Generally speaking, you can include your policy as a deduction on your Federal taxes. Payments from these care plans are rarely taxed either. Always check to verify that your plan is Tax-Qualified. It will usually be referred to as a TQ policy if it is. Long-term care policies can be purchased in a few different ways: From an insurance agent Through the mail From your employer Through a membership with one of several groups If your long-term care insurance comes from your employer, you should be able to continue your plan or transfer it to a new policy. Medicaid Medicaid is government program that can assist you with certain types of medical bills. Both the Federal government and the states fund it, but each state is free to choose how to implement it. For this reason, coverage isn t the same everywhere. Assistance is usually based on your income levels and net worth. Medicaid is intended for people with few resources, or who are disabled, which means that it s only available if your other resources are exhausted. The program typically covers nursing care. In many states it will also pay for long-term care services both in and outside of the home. 4

5 Medicare Assistance from Medicare is very limited. In some cases it will pay for professional assistance, but only when it is considered medically necessary. Non-professional caregivers will not receive compensation at all. Life Settlements In some cases, you may be able to cash in your life insurance policy and use the funds to pay for your long-term care. This can be a viable option if your children have left the home or if you have gone through a divorce, or if for some other reason you no longer need your life insurance policy. Women must be over 70, and men must be older than 74, in order to do this. Some insurers won t allow you to do this if you are considered ill, and other obstacles are possible. Home Equity If you own a significant portion of your home, you can trade this ownership for a loan. A special type of home equity loan, called a reverse mortgage, allows you to do this without needing to make any immediate payments on the loan. Payments don t start until the home is no longer your primary living space. This program is insured by the Federal HUD program, and it s available if you are older than 62. You must live in the home in order to qualify for a reverse mortgage. In some cases, if you own the entire home or have a very low balance on it, you may qualify for a reverse mortgage if you are younger. 5

6 Aid and Attendance Veterans Benefit The Veterans Administration (VA) Aid and Attendance Pension is designed to provide qualified veterans and their surviving spouses with a tax-free pension benefit. This benefit provides a direct tax-free monthly pension to help defray the cost of care in assisted living communities. If you re a veteran, or lost a spouse who worked for the military, this may be an option if you need a caregiver and your financial situation is difficult. You don t need to have been injured in the military to qualify. The Aid and Attendance Pension may be able to provide as much as: $1,632 a month for a veteran $1,055 per month to a widow(er) $1,949 a month to a couple You are only eligible if you need help bathing, cooking, eating, dressing, using prosthetics, leaving the home or with other basic needs. If you are blind or suffer from a mental or physical limitation, or if you need to live in a nursing home, you may also qualify. Eligibility is determined in part by a meeting with a doctor. Your doctor will need to verify that you can t function entirely on your own. Brought to you by: The Stratford at Maple Leaf 9001 Lake City Way Northeast Seattle, WA (206)