How to Pay for a Nursing Home for Your Loved Ones: Five Ideas
Choosing a nursing home is often a difficult and emotional decision. It can be hard to accept that you or your loved one needs extra care, and it’s also tough to figure out how to pay for a nursing home. Many people are shocked that the average cost of a nursing home is so much higher than the cost of assisted living or the cost of in-home care.
You want to find a home that’s a good fit for you or your loved one, but you also need to keep finances in mind. This raises a big question: How do you pay for a nursing home?
Nursing home costs to know
Rates vary by region, but even at the low end, nursing home costs are high. In the US, median monthly rates for a shared room in a nursing home range from less than $5,000 to over $12,000 per month, according to SeniorLiving.org.
Here are two reasons why nursing home expenses are so high:
- Level of care: In long-term care settings like nursing homes, residents have around-the-clock care from nurses or nursing assistants, depending on the facility. Costs add up if your loved one needs many years of care. Compared to assisted living, which offers basic help like cooking and housekeeping to residents, nursing homes also have on-site medical services like dialysis. Medical services contribute to the high cost of nursing home care.
- Supply and demand: There are more elderly Americans today than ever before. Yet there aren’t enough nursing home workers to fill those care jobs, according to Claims Journal. As a result, nursing home costs will almost certainly rise in the future if the ratio of workers to residents stays the same or shrinks.
Consequently, many older folks use up retirement savings to cover nursing home care, unforeseen medical bills, or emergency expenses. There are many sources that provide financial help for seniors, but most of these don’t directly pay for nursing homes.
Five ways to pay for nursing home care
If you or your loved one is struggling to afford care that’s desperately needed, here are five options to help pay for a nursing home:
1. Check if federal programs cover nursing home care
The federal government has two main insurance programs for citizens and some immigrants. The first is Medicare and the second is Medicaid. Your loved one may get their nursing home stay covered through both programs. Here’s what each program offers:
- Medicare covers seniors only, while Medicaid is available to qualifying low-income individuals of all ages.
- Medicare covers nursing home stays of up to 100 days. The program covers the first 20 days in full, and after that, patients pay some costs out of pocket each day.
- In 2021, the Medicare copay will be $185.50 per day, or almost $15,000 dollars for 80 days.
- If your loved one has Medicare Supplemental Insurance, that plan will cover some or all of those costs.
- Medicaid has different requirements. It requires seniors to put all but $2,000 of their personal savings toward care before it will pay for nursing homes.
It can be difficult to figure out the programs for which you or your loved one qualify. Fortunately, the government has free services to help you find the right care:
- For Medicare, State Health Insurance Assistance Programs can help you and your loved one find a plan that fits your needs.
- For Medicaid, eligibility varies based on your location, marital status, or if you are a veteran. This local help site can help you find the care that best fits your needs.
2. Long-term care insurance
Long-term care insurance covers medical bills if your loved one develops a chronic illness that requires assisted living or a nursing home.
- According to AARP, the average cost of a nursing home stay is $140,000 if you pay out of pocket. This doesn’t include other medical bills your loved one may have while in care.
- To maximize benefits, it’s best to buy long-term care insurance in one’s 50s or 60s, before you or your loved one needs a nursing home.
3. Crowdfund your care
Unfortunately, not everyone meets the strict requirements for government aid. You may not be willing or able to take out a new insurance policy to cover nursing home expenses. Asking for help isn’t always easy, but crowdfunding makes it simple to share your story and your needs with friends, family, and your community.
It’s also likely that many others in your life understand your situation because they’ve also thought about the cost of assisted living or how to pay for nursing home care. Online fundraising makes it easy to mobilize your community to get help with bills related to caring for your older loved ones.
Here are a few reasons why countless people have turned to online fundraising in times of need:
- Setting up a fundraiser is simple and takes just a few minutes.
- You can get the money from your fundraiser without a long wait.
- It’s easy to share your fundraiser on social media, so you can reach generous people outside your community.
- There’s no application process for aid, so anyone with a need can fundraise online.
- Beyond nursing home costs, you can raise funds for anything from hearing aids to medical bills.
4. Plan an estate sale
If your loved one is moving into a nursing home, consider selling unwanted furniture, jewelry, appliances, and other items at an estate sale. You can do it yourself or hire an estate sale company to appraise valuables, arrange your home, advertise, and staff the sale. An estate sale won’t cover the entire cost of a nursing home, but the profits can offset expenses.
5. Take out a reverse mortgage
Reverse mortgage loans let you cash out the equity you’ve built up in your home. The lender can send you a check on a one-time or monthly basis, or as a line of credit. This option gives elders or their families access to immediate cash to pay for major expenses like nursing home care.
However, reverse mortgages can be financially risky. They can also affect your loved one’s ability to qualify for Medicare and Medicaid. It’s best to consult a lawyer or financial advisor before you make any big decisions around nursing home care.
Find nursing home care for you or your loved ones today
Choosing a nursing home is a big life decision. You want the best for your loved one, but finding care without going into debt is a huge challenge. Whether you need to cover costs to help those you love and care about, or you need to offset your own expenses, crowdfunding is a simple way to find financial relief.