Estate Planning Blog

How Is Nursing Home Care Paid For?

We are often asked to discuss the different ways in which an individual can pay for the expenses of nursing home care. While every situation is different, typically, there are three ways to pay for nursing home expenses: 1) long-term care insurance, 2) private pay (out-of-pocket), or 3) Medicare/Medicaid. With nursing home costs around the Ohio Valley ranging from $4,000 – $9,000 a month, and increasing 12-14% per year, it is extremely important to plan for the well-being and financial security of your loved ones now so that his/her hard-earned assets are not depleted.

Long-term care insurance.

Long-term care insurance is an insurance policy that will help an individual pay for care when he or she is unable to care for him or herself. It is an effective way to plan for your family’s financial future and protect your own investments and savings. The longer an individual lives, the greater the chance of that person needing some type of long-term care. The issue with long-term care insurance is that it is more affordable when an individual is younger, at a time when long-term care insurance may only be a distant concern, if a concern at all. Often times, individual’s don’t contemplate purchasing long-term care insurance  until they see an immediate need, which at that point the cost may be too high or the individual  may otherwise be deemed to be uninsurable. If purchased early enough, long-term care insurance can be a great tool for paying for elder-care expenses as it can provide for home care, assisted living, nursing home care, hospice, etc.  

Private Pay.

Private paying occurs when an individual pays out-of-pocket for nursing home care. As previously mentioned, monthly nursing home expenses can range from $4,000 to $9,000, and climbing. With the average stay in a nursing home being around 3 years, the expenses can sure add up – and at a quick pace.


Medicare is a federally funded and administered health insurance program that spreads the financial risk associated with illness across society to protect everyone. While there are no financial requirements in order to receive Medicare, recipients must be at least 65 years of age (or younger if disabled). Medicare may only pay up to 100 days for skilled care, although it is not required to pay the full 100. The first 20 days are completely covered; thereafter, there is a deductible that applies for the remaining 80 days.

Medicaid is a federally funded and state administered health insurance program for individuals who meet certain financial requirements. Financial eligibility is met when the Medicaid applicant’s countable assets are less than $1,500 – $2,000 (depending on what state you are receiving care) and your monthly income is less than the monthly Medicaid reimbursement rate. (Certain assets are not included in this configuration, i.e. your primary residence, one automobile, etc.) Under Medicaid, all monthly income except for $50 and any medical insurance premium go to the nursing home.  Medicaid is a highly complex area of law but is a wonderful program to help those who are in need.

If you would like to discuss estate planning for yourself or a loved one, please call our offices and set up a free consultation!!!

The Power-of-Attorney: The Single Most Important Estate Planning Document

Posted by on Jun 18, 2013 in Estate Planning | 0 comments

Many estate planning and elder law attorneys will tell you that the Power-of-Attorney is an absolute must have in order to effectuate a sound and complete estate plan. A power-of-attorney is a legal instrument created by an individual (known as the “principal”) that authorizes a person (known as the “attorney-in-fact”) to act on the principal’s behalf regarding his or her financial affairs. The attorney-in-fact has a fiduciary duty to act honestly, loyally and in the best interest of the principal at all times. This inexpensive...

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