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What is Long Term Care and Who Pays for it?
Definition: What is Long Term Care
Prior to a discussion of who pays for long term care, it is helpful to clarify what long term care is and is not. For the purposes of this article, we are focused on the aging, elderly or individuals with disabilities. Our definition of long term care is any care provided to an individual which is of a personal nature, such as assistance with dressing or bathing, or care that is medical in nature. For example, care provided by doctors and nurses. Long term care can be provided at home, in assisted living, in a nursing home or an adult day care center.
Amongst certain industry groups, the phrase "long term care" is synonymous with "long term care insurance". This is worth noting because this definition of the phrase can be misleading and confusing to consumers.
Who Pays for Long Term Care?
Unfortunately, there is not a simple answer to this question. Who pays largely depends on the income and assets of the individual in need of care and the severity of the care they require. It is perhaps easiest to address this question by breaking it down into smaller questions. It is also helpful to understand that very rarely does a single source pay for care; it is much more common for the cost of care to paid for by multiple sources.
Who pays for long term care for the poor?
For low income, elderly individuals and families, the cost of medical care is largely covered by Medicare or Medicaid for very low income persons with limited assets who meet the Medicaid eligibility limits. Often times, the poor do without medical care, forego their prescription drugs or simply receive medical services in the emergency room and are unable to pay their medical bills. In fact, many medical bills result in bankruptcy filings are discharged.
However, Medicare does not pay for personal care in long term care situations. State Medicaid programs will pay for personal care when it is provided in a skilled nursing facility (or nursing home). Depending on one's state, there are Medicaid waiver programs that provide assistance for personal care outside of nursing homes. Using a waiver, one can receive care at home, in adult day care or in assisted living residences.
There are also several veterans' long term care assistance programs and some state assistance programs for individuals that do not qualify for Medicaid. Despite these programs, very often families with limited means bear the full burden of providing personal care themselves.
Who pays for long term care for low to middle income families?
For medical care, Medicare is the primary source of funds. Low and middle income families often have Medicare Supplemental insurance which provides additional assistance for Medicare co-payments and other gaps.
Personal care is not covered by Medicare. Veterans' benefits do provide some assistance for low to middle income families such as the Aid and Attendance Program. Medicaid, however is not as much of a factor as the vast majority of families in this income level do not qualify. Many states provide assistance to individuals that do not qualify for Medicaid with the objective of keeping them out of the program. Since Medicaid is a very expensive program, states offer personal care or financial assistance programs designed to prevent or delay Medicaid enrollment. In the long term, this can be less expensive for the states.
Who pays for long term care in middle to higher income families?
Middle to higher income families typically can afford better health insurance and therefore a higher percentage of their medical care is paid for by their insurance programs. This might include Medicare, Medigap or Supplemental Insurance as well as other private insurance. Individuals with middle or higher incomes do not qualify for Medicaid.
Most of the state-based or veterans programs that provide personal care assistance have income limits and / or assets limits. Therefore, higher income families rarely have personal care paid for by these programs. However many middle and higher income individuals have long term care (LTC) insurance. Most LTC insurances provide a daily allowance for personal care. Those without LTC insurance often pay of pocket for home care aides or assisted living.
Who pays for long term care for the poor?
For low income, elderly individuals and families, the cost of medical care is largely covered by Medicare or Medicaid for very low income persons with limited assets who meet the Medicaid eligibility limits. Often times, the poor do without medical care, forego their prescription drugs or simply receive medical services in the emergency room and are unable to pay their medical bills. In fact, many medical bills result in bankruptcy filings are discharged.
However, Medicare does not pay for personal care in long term care situations. State Medicaid programs will pay for personal care when it is provided in a skilled nursing facility (or nursing home). Depending on one's state, there are Medicaid waiver programs that provide assistance for personal care outside of nursing homes. Using a waiver, one can receive care at home, in adult day care or in assisted living residences.
There are also several veterans' long term care assistance programs and some state assistance programs for individuals that do not qualify for Medicaid. Despite these programs, very often families with limited means bear the full burden of providing personal care themselves.
Who pays for long term care for low to middle income families?
For medical care, Medicare is the primary source of funds. Low and middle income families often have Medicare Supplemental insurance which provides additional assistance for Medicare co-payments and other gaps.
Personal care is not covered by Medicare. Veterans' benefits do provide some assistance for low to middle income families such as the Aid and Attendance Program. Medicaid, however is not as much of a factor as the vast majority of families in this income level do not qualify. Many states provide assistance to individuals that do not qualify for Medicaid with the objective of keeping them out of the program. Since Medicaid is a very expensive program, states offer personal care or financial assistance programs designed to prevent or delay Medicaid enrollment. In the long term, this can be less expensive for the states.
Who pays for long term care in middle to higher income families?
Middle to higher income families typically can afford better health insurance and therefore a higher percentage of their medical care is paid for by their insurance programs. This might include Medicare, Medigap or Supplemental Insurance as well as other private insurance. Individuals with middle or higher incomes do not qualify for Medicaid.
Most of the state-based or veterans programs that provide personal care assistance have income limits and / or assets limits. Therefore, higher income families rarely have personal care paid for by these programs. However many middle and higher income individuals have long term care (LTC) insurance. Most LTC insurances provide a daily allowance for personal care. Those without LTC insurance often pay of pocket for home care aides or assisted living.
How Can We Afford Long Term Care?
Find Affordable Long Term Care Options
Learn Ways to Reduce Your Cost of Care
Find Financial Assistance for Long Term Care
Learn about Long Term Care Loans
Learn Ways to Reduce Your Cost of Care
Find Financial Assistance for Long Term Care
Learn about Long Term Care Loans
