The phrase “long term care” is regarded as a panoply of care services that individuals may need. Sometimes, long-term care may cover skilled nursing / medical care. However, most times it is usually related to non-medical assistance with the basic self-care responsibilities of our day-to-day life, also regarded as activities of daily living (ADLs).
ADL may include things like bathing, dressing, eating, and/ or using the restroom. A holistic approach to long-term care covers instrumental activities of daily living (IADLs) such as housework, paying bills, and/ or shopping for and making meals.
Seniors are bound to require long-term assistance
Based on findings by the U.S Department of Health and Human Services (DHHS), 70 percent of individuals turning 65 will need some type of long-term help. Also, a recent poll from the Associated Press and the National Opinion Research Center shows that more than three-quarters of seniors would like to receive that care in their residence, rather than in an assisted living facility.
However, the price tag on receiving care in the residence from a paid caregiver may be quite expensive than most people think. In fact, some people are shocked to realize that it could cost more than living in one of those assisted living facilities.
Generally, long term care is so expensive that thinking of it gives people headache. If you have the intention to receive long term care but don’t know how to pay for it, I’ve got you covered. Below are some the primary ways to pay for long-term care.
Main Ways to Pay for Long-term care
- Select the right long-term care
Other alternatives aside from a nursing home include hiring a home health agency, adult day services, and relocating to a residential group home or an assisted living facility. Assisted living can be cheaper than a nursing home if the individual is healthy and doesn’t need medical help. Selecting the appropriate option can help you save a lot of cash going forward.
- Consider using social security or pension to pay for care
Most individuals use their Social Security check to settle their long-term care bill. It is a certain income, and this, merged with other certain monthly income like pension, can lessen the long-term care bill.
- Take money from an individual retirement account
The income gotten may make you eligible for a medical expense deduction. Withdrawing money from an IRA will increase an individual taxable income. However, the tax deduction from using this money only for long-term care costs turns one’s IRA into a tax-exempted health savings account.
- Consider veteran aid and attendance programs
This less common Veterans Administration offering offers up to $1,830 each month for any individual who has served 90 days in the military during a period of war, and up to $1,176 for surviving spouse.
- Activate a chronic illness rider
If you or your parents have a term life or permanent life insurance policy that comes with a chronic illness rider, you might be lucky. The triggers for the chronic illness riders are similar to the triggers required to make you eligible for long-term care insurance claim. You can be eligible if you can’t do two of six tasks of daily living without help or if you require help for cognitive impairment.
- Sell a home or acquire a reverse mortgage
Some people sell their parents’ home to pay for their long-term care. However, if one spouse is still residing in the home, a reverse mortgage may be the best option to assist in paying for the other’s long term care.
- Apply for Medicaid
The rules for Medicaid care benefit (restricted to individuals with low incomes and assets) is different in each states, and you or your parents may not be eligible if a huge percentage of your assets were transferred into another person’s name within the past five years. Contact a financial adviser in your state for more information.
