Nursing Home & Long Term Care Planning

Let us provide you with a general overview of long-term care planning. First, long-term care insurance is great if you have it.  That said, most people do not have this type of insurance, and Medicare and your supplemental health insurance only cover UP TO 100 days for rehabilitation in a nursing home.  Thereafter, there generally is no coverage available.  Long-Term Care benefits are generally limited to a maximum per day benefit.  Many times the maximum daily benefit is well below the actual cost of care.  Also, the length of benefit may be limited in total dollars paid out or by time.  Even though most long-term care policies are guaranteed to be renewable, there is generally no guarantee regarding the amount of future premiums.

Basically, there are four (4) ways to pay for long-term care:

  • Private Pay
  • Long-Term Care Insurance
  • VA Aid and Attendance
  • Medicaid

Private Pay:  Nursing homes in general cost $7,000 to $9,000 per month.  Assisted Living Facilities generally start with a base rate of approximately $2,000 a month, and then add “care points” based on the needs of the individual for assistance with the activities of daily living.  It is very common for the total assisted living facility bill to be between $3,500 and $4,500 a month.

Long-Term Care Insurance:  Long-Term Care Insurance is great if you have it.  That said, most people do not have this type of insurance, and Medicare and your supplemental health insurance only cover UP TO 100 days for rehabilitation in a nursing home.  Thereafter, there generally is no coverage available.  Long-Term Care benefits are generally limited to a maximum per day benefit.  Many times the maximum daily benefit is well below the actual cost of care.  Also, the length of benefit may be limited in total dollars paid out or by time.  Even though most long-term care policies are guaranteed to be renewable, there is generally no guarantee regarding the future amount of premiums.

VA Aid and Attendance:  If an individual served in the US military for at least 90 days on active duty, one day during a declared wartime, they can potentially obtain VA Aid and Attendance benefits.  The maximum amount of monthly VA Aid and Attendance benefits is approximately $2,100 for a veteran ($1,100 for a surviving spouse who did not re-marry or divorce).  You are permitted to have both VA benefits and Medicaid benefits paying at the same time.  Generally, the VA does not cover nursing home care unless you have a 100% service connected injury; otherwise, the VA Aid and Attendance benefit drops down to $90 a month in a nursing home.  The VA has separate Rules from Medicaid that are based on federal law.  There is generally a 9-13 month waiting list for benefits, however, when the benefits are ultimately paid, they are paid retroactively to the date of application.  There is no look-back period for gifting in the current VA system for gifts made prior to the VA application.

Medicaid:  Medicaid has three (3) Long-Term Care programs:  the Home and Community Based Care program; the Assisted Living program; and the Nursing Home program.  Effective August 2013, all of these programs were outsourced by the State of Florida and are managed by private, for profit companies, paid by the State of Florida.  Medicaid law is a combination of both state and federal Law and differs from state to state.  The State of Florida has some of the most advantageous laws in the United States.  Medicaid Rules are very different from VA Aid and Attendance Rules.  Medicaid has a five (5) year look-back period for uncompensated transfers (“gifts”) made by the applicant to anyone but their spouse. The Home and Assisted Living Programs are not “entitlement” Programs, so often there are waiting lists for funded positions.  The Nursing Home Program is an entitlement Program, so there should always be funding for this Program.

Home and Community Based Care Program:  Consists of 10-15 hours per week of various care in an individual’s home such as personal care, medication co-pays, over the counter medications, home delivered meals, house cleaning, environmental adaptation, companion, respite care, and adult day care.  The home can be the individual’s residence, the residence of a friend or relative or even the independent living section of an assisted living facility.  Once an individual qualifies for this Program, it is free (no patient responsibility) for the care provided.

Assisted Living Facility Program:  There are about 50 facilities in Brevard County that accept Medicaid as a form of payment.  However, there is an issue with this Medicaid Program, as it has minimum payments required to be paid to the facility, even while on Medicaid benefits, which varies from facility to facility.

Nursing Home Program:  Generally, almost all nursing homes accept Medicaid as a form of payment and the majority of residents who are in the facility for long-term care are on Medicaid.