With the aging of our population and the improved healthcare available, people are living longer. Of those, perhaps a large percentage will eventually need nursing home care. This will present a major financial burden to many families. Elder law planning is essential. So how does nursing home care get paid?
In simplest terms, there are three ways to pay for nursing home care: 1) self-pay; 2) long-term care insurance; and 3) using governmental benefits such as Medicaid. Let's consider each of these options briefly.
As to the self-pay option, the main consideration is that it is extremely expensive to pay for such care out of one's own pocket. In Florida, depending on the facility and the level of care received, nursing home care can easily run $5,000 per month and in many instances is closer to $7,500 per month. Therefore, except for fairly wealthy persons, the self-pay option is not a good one.
As to long-term care insurance (what some people call nursing home insurance), the fact is, most people do not have it. They either cannot qualify for it due to health issues or they cannot afford it. The reality is that many persons would benefit from this type of insurance but they should get it while they are still young enough to qualify and to get a rate that is affordable.
Lastly, a person may get assistance for nursing home care through Medicaid's ICP program. However, in order to qualify for this program, the person must meet a three-part test: 1) medical 2) income; and 3) resources. The medical test simply requires a physician to state that the person needs the level of care offered through the nursing home. The income test sets a limit on how much the person can receive in monthly income. If above the limit amount, a Qualified Income Trust, or QIT, can be used. For the resource test, the person is limited to a certain level of countable assets. If they are above the allowed level, then planning will need to be done and action taken to get them to the allowable level.
If a person is seeking to qualify for the Medicaid ICP program in order to pay for nursing home care, the assistance of an elder law attorney is usually necessary.