While post-retirement medical costs are often underestimated during retirement, there are ways to cover those costs with careful planning, according to the Deseret News article, “How to cover the cost of long-term care.”
Many people planning for retirement expect Medicare to cover the costs but Medicare is very strict as to the types of long-term care it covers. The program only covers stays in skilled nursing facilities and hospice care under certain strict circumstances.
The article explains that for skilled nursing facility (“SNF”) coverage a beneficiary is required to be admitted to a hospital for at least three days, then discharged with a condition that requires skilled nursing level care.
Medicare will cover all of the expense for the first 20 days of the stay. The program then charges a $161 co-pay for every day up to 100 days. Once a patient reaches 100 days, he or she must cover the entire cost after the initially covered 100 days. But if he or she is out of an SNF for more than 60 days, the coverage resets and they can be admitted for another 100 days after a three-day hospital admission. Simple, right?
Medicare covers most types of hospice coverage when a patient has received a terminal illness diagnosis and is not projected to live more than six months. This will encompass the patient’s medication, support services, and services such as grief counseling. Medicare will also pay for short-term hospital stays and inpatient care for caregiver respite. In addition to Medicare, the federal government also provides some coverage through Veterans Affairs (VA). But unlike Medicare and the VA, Medicaid can assist those seniors who qualify with most types of long-term care.
Medicaid is administered by the states, so the benefits and eligibility will vary. However, most of these programs are given incentives for administering alternative programs that let seniors stay at home or with a family member. If the beneficiary qualifies, family members providing their care may be certified as providers and reimbursed for their efforts by Medicaid.
One option for the proactive is purchasing long-term care insurance to cover the costs. However, if that coverage is too expensive because you’re late in buying a policy or you have pre-existing health issues, you should look at other options like Medicaid. If you go that route, you may need to transfer assets and income to trusts or family members. Speak with a competent elder law attorney before you make any moves.
An elder law attorney can guide you about long-term medical care costs during retirement. When selecting an elder law attorney, make sure he or she specializes in this area of elder law. At Family Estate Planning Law Group, this is an important part of how we care for clients and their families. For more information, explore our website and contact us to schedule your consultation today!
Reference: Deseret News (Sept. 27, 2016) “How to cover the cost of long-term care”