Resources are available for families who
need caregiving help
En español | Planning for in-home care is a
lot like the Chinese adage about planting a tree: The best time was 20 years
ago, and the second best time is today.
Older Americans determined to stay in their
own homes are likely to need help at some point — for a few hours a day or 24/7
— with household chores, nursing services and personal care. And with 10,000
baby boomers a day turning 65 between now and 2030, the need for home health
care will only increase.
Those who plan early may buy insurance
policies that cover home-care benefits. That could be long-term care insurance, or a life insurance policy with a rider for
long-term care, sometimes called hybrid policy.
That's if they can afford long-term care
coverage. When 2012 premiums for a couple who are both age 60 are adjusted to
2019 dollars, the most recent available information from the American
Association for Long-Term Care Insurance, the cost averages almost $3,800 a
year.
Plus one in 5 applicants younger than age of
60 are declined, and the proportion rises with age, according to 2019 industry
data from the same trade group.
Those without long-term care insurance often
start out relying on an unpaid family caregiver, but eventually many need
to turn to paid help. And that can be expensive, too: According to insurance
company Genworth's 2019 survey on the cost of long-term care, the
national average bill for a home health aide is $4,385 a month.
"I think it's a crisis,” says Jennifer
VanderVeen, president of the National Academy of Elder Law Attorneys. “Getting
reliable home health care is not as available and affordable as it should
be."
Paying out of pocket
"For the most part, the clients who have
home care are private pay,” says Jerry Love, a certified public accountant in
Abilene, Texas, and a frequent lecturer on financing retirement and long-term
care for the American Institute of Certified Public Accountants.
Many cobble together a care budget from
multiple sources, among them:
·
Annuities
·
Investments
and savings
·
Life
insurance policies that
can be used for qualified home-care expenses through cash value or an
accelerated death benefit
Keep in mind that using your house to provide
cash for long-term care is risky: You could run out of equity in your home
while you still need the care.
Research reverse mortgages, available only to
those 62 and older, to see if they are the right solution. The first step in
qualifying for a federally approved reverse mortgage is an educational session
with a qualified counselor who will guide a homeowner through the process and
list of fees.
You may be able to save on home care by hiring
an aide directly, which tends to be cheaper than going through a home-health
agency. But being an employer comes with responsibilities, Love says.
"First, you have to be sure you're paying
the minimum wage,” he says. “And if the person is working more than 40 hours a
week, you must pay overtime."
Government help
You can get help paying for in-home care if
you don't have insurance coverage for long-term care and can't afford to pay
out of existing financial resources.
Start by searching the federal
government's Eldercare Locator to find your local Area Agency on Aging.
Those offices are “the first place to look,”
VanderVeen says. “They have resources on home health care, and they are the
gateway to Medicaid, which pays for home services.” You can also check the
National Council on Aging's BenefitsCheckUp to
find out what programs you may qualify for.
Help with home-care bills may be available
through Medicaid if the care recipient has a low income or limited assets.
Medicare can also pay for home health services in some circumstances, and the
Department of Veterans Affairs (VA) offers home-care support for former service members. People who pay for caregiving also can
qualify for tax breaks.
Medicare
Original Medicare can cover the full cost
of medically necessary home health care on a limited basis for beneficiaries who are
unable to leave home without assistance. That could include:
·
Skilled
nursing care
·
Occupational,
physical and speech therapy
·
Home
health aide services, if the recipient
also needs therapy or skilled nursing
Original Medicare will cover routine home
care — help with daily activities such as bathing and dressing and basic
medical care such as checking vital signs and dressing wounds — only on a
part-time or intermittent basis, and only if a doctor orders it as part of a
broader plan of care. It will not pay for full-time home care or for personal
and homemaker services if that is the only help you need.
However, Medicare Advantage (MA) plans —
private insurance policies that match original Medicare’s coverage but can
provide additional benefits — have the option to offer broader and longer-term
coverage for home health services. For example, an MA plan might cover a
personal care aide even if the recipient does not need therapy or skilled
nursing. If your loved one has MA, check with the plan provider.
Medicaid
The joint federal-state program does pay for
in-home care, some residential and assisted living care, and nursing home care.
More than half of all Medicaid spending on long-term care goes toward home- and
community-based services.
Home health services are less limited under
Medicaid than with Medicare, but each state runs its Medicaid program
differently, and eligibility and benefits vary.
Veterans programs
Eligible former service members may qualify
for one of several VA programs that help pay for care at home,
including Aid and Attendance benefits, Housebound
benefits, Veteran Directed Care, and Homemaker and Home
Health Aide Care.
Contact your regional VA benefits office for information.
Taxes
If you're hiring and paying for home care for
medical reasons, you may qualify for a federal tax deduction, just as if the
loved one were in a nursing home, Love says.
An adult child serving as a caregiver for a
live-in parent also can get a tax break by claiming the parent as a dependent. But the child must meet certain criteria,
including providing more than half of the care recipient's financial support.
A lesser-known option: PACE
Programs of
All-Inclusive Care for the Elderly (PACE) is a small but growing Medicare and Medicaid initiative
aimed at keeping frail seniors out of nursing homes. About 45,000 people were
enrolled as of May 2019 through more than 100 organizations offering PACE
programs in 31 states.
Among other things, PACE covers in-home care,
adult day care, checkups, hospital and nursing home stays, prescriptions and
some transportation for medical purposes. It can also pay for training, support
and respite for family caregivers.
Local PACE organizations work with medical
providers who form the recipient's health care team. If the team decides your
loved one needs care that Medicaid or Medicare doesn't provide, PACE still may
cover it.
To be eligible, someone must be:
·
55 or older
·
In need of nursing
home-level care as certified through your state
·
A resident of an area
with a PACE organization
·
Able to live safely in
the community with help from PACE. People with Medicare, Medicaid or both can
qualify although if you have Medicare only you might be charged a monthly
premium. Those not covered through either program can pay for PACE privately.
Editor's note: This article, originally
created in 2016, has been updated with more recent information. Stephanie
Mansfield contributed additional reporting.
Learn More about Caregiving Finances
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