Nearly one third of all adults in the United States are unpaid family caregivers for a loved one needing assistance, and with the expanding senior population, this number only promises to grow. Additionally, two out of five Americans will need long-term care at some point in their lives. When the cost for this care falls directly on the individual needing care or on the family, which in many cases it does, these statistics prove significant.
Many people believe that Medicare will pay for long-term care, but this is not the case, often leading people to wonder how they will be able to pay for the care needed. EvergreenChoice would like to inform the local community about resources available to help offset or supplement the cost of long-term in-home care.
Although the majority of costs for our services are “out of pocket” or private pay, there are
sources of funding that can help pay for the cost of home care. Please note, Medicare does NOT pay for long term care.
Here are a number of different ways our client/patients are paying for home care services that may also be available to you:
Long-Term Care Insurance
Many insurance companies have brokers specializing in this type of insurance. LTC policies that allow for substantial home care benefits should be obtained to cover in-home care due to frailty or a chronic illness. Consumer Reports offers the following guidelines when shopping for LTC insurance:
– Consider buying at around age 65, as policies and coverage change over time. If there is a chronic or potentially incapacitating condition like diabetes, it is recommended to purchase between the ages of 55 and 60.
– Look for a strong insurer that receives high financial safety marks from insurance ratings companies.
– Buy a flexible policy requiring inability to perform no more than two activities of daily living, such as bathing.
– Cover future costs. It is vital that the daily benefit increase along with the price of care.
– A four-year benefit plan should be sufficient, with a 30-day elimination period.
Home Equity Conversion Mortgage (HECM)
Created by the U.S. Department of Housing and Urban Development (HUD) Federal Housing Administration (FHA), Home Equity Conversion Mortgages, or Reverse Mortgages, enable homeowners to withdraw some of the equity in their home, offering older Americans greater financial security. This special type of loan allows the homeowner to convert a portion of the home’s equity into cash. Unlike a traditional home equity loan or second mortgage, however, no repayment is required until the borrower(s) no longer use the home as their traditional residence. Here are some other facts about HECM:
– To qualify, the FHA requires that homeowners be at least 62 years of age, own their home outright or have a low mortgage balance that can be paid off at closing with proceeds from the reverse loan, and live in their home.
– Eligible homes must be a single family home or a 1-4 unit home with one unit occupied by the borrower. HUD-approved condominiums and manufactured homes that meet FHA requirements are also eligible.
– The loan does not need to be repaid as long as one of the borrowers continues to live in the house and keeps the taxes and insurance current. The owner can never owe more than the value of the home at the time the heirs sell the home.
– When the home is sold, the estate will repay the cash received from the reverse mortgages, plus interest and other fees, to the lender. The remaining equity in the home belongs to the owner or the heirs.
The Veterans Administration (VA)
The Veterans Administration offers a plan to help senior veterans with a qualifying medical condition who require the need for assistance with activities of daily living. To qualify, the veteran must:
– Have received an honorable or general discharge
– Have doctor’s orders stating the need for aide and assistance of others daily
– Meet financial requirements
– Have served one day during an active war and had no less than 90 days of service
The surviving spouse of a veteran may also qualify providing he or she was still married to the veteran at the time of the veteran’s death. The VA offers two types of benefits, Aid and Attendance benefits and Housebound benefits. These benefits are paid in addition to a monthly pension to eligible veterans, but may not be paid without eligibility to pension. A veteran cannot receive both Aid and Attendance and Housebound benefits at the same time. Visit http://www.vba.va.gov/bln/21/pension/vetpen.htm for further information.
For information about any of these funding options, please do not hesitate to call EvergreenChoice 212-655-9525.