Helping Seniors in Our Community Find Financial Options for Assisted Living
Guest Post by Teresa Greenhill
If you were to need long-term care / helping seniors starting today, how would you pay for it? If that question leaves you scratching your head, keep reading for answers courtesy of the Discreet Pharmacist.
Medicare not a miracle
Medicare is valuable, there’s no doubt about that. It provides a wide range of services that can keep you healthy starting on your 65th birthday. But it’s not meant to cover everything, and in most circumstances, Medicare doesn’t pay for extended care. But you do have options whether you’re 26 or 66.
The sooner the better
When you reach a certain age, you become eligible for many discounts. But your insurance isn’t usually somewhere you’re going to save. Long-term care insurance premiums are significantly less expensive in your 50s and early 60s than if you wait just a few years. Medicare.org notes that rates can jump by up to 8 percent by your mid 60s. (If you’re reading this as a caregiver, now’s a great time to consider your own long-term care needs.)
When you can’t afford long-term care insurance
If you’re outside the window of affordability, you still have options when it comes to paying for long-term care or helping a loved one do the same. These include:
- Medicaid. According to the American Elder Care Research Organization’s website, Medicaid offers inconsistent benefits from state to state, although assisted-living is covered in 43 states. The vast majority of Medicaid assisted-living benefits come in the form of waivers. You’ll have to apply and meet strict eligibility requirements. Even if you are eligible, there may be a waiting list.
- Veteran programs. Depending on your length of service and whether or not you were active during wartime, you may be eligible for veteran’s benefits. There are different types of veteran pensions available including basic, aid and attendance and homebound. In 2019, eligible veterans – and their spouses – may receive up to $2,230 per month to cover the cost of long-term care. Military.com offers general information about the upcoming changes to military retirement pay.
- Social Security. Social Security does not specifically pay for long-term care. However, optional state Social Security supplements may be available. These can come in one of two forms: providing money and capping the amount an assisted living facility can charge patients paying with Medicaid.
- Assisted living loans. An assisted-living loan or bridge loan, can help pay for senior care and typically requires an interest-only payment each month. If you have good credit, you will likely receive competitive rates and favorable terms. These loans, according to Elderlife Financial Services, are sent directly to a specified senior living community. It should be noted that your heirs or your estate are obligated to repay the loan upon your passing.
- Selling your home. If you’re a homeowner, selling your home could help fund your long-term care. Check online to get a home-value estimate to get an idea if this is a realistic option for you.
- Reverse mortgage. There is a lot of misinformation about reverse mortgages and this loan product has garnered a bad reputation thanks to unscrupulous lenders. Nonetheless, Bankrate contends that a reverse mortgage is a good option if you plan to live in your home and can afford property taxes and insurance. You have to be at least 62 years old to qualify and lenders typically want you to own your home outright. You are given a loan based on a percentage of your current home equity. The loan does not have to be repaid until you die, move or sell.
Today, the average life expectancy hovers just under 79 years. If you retire at 65, that leaves you more than a decade where you’re potentially without an income.
Even if you have a solid nest egg set aside, it never hurts to be aware of the options available to help pay for long-term care.
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