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Blog > Medicaid Planning > How to Pay for a Nursing Home Stay

How to Pay for a Nursing Home Stay

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November 19, 2020 Medicaid Planning

The reality is that 70% of seniors will require long-term care at some point in their lives. Unfortunately, many of them are unprepared for the high costs associated with the nursing home. And they’re stuck asking themselves, “How am I going to pay for this?” Well, if you’re wondering how to pay for a nursing home stay, you’re in the right place.

If you need fast answers on how to pay for your loved ones nursing home care, we encourage you to try our FREE online planning wizard where we will help outline your planning solutions within minutes. Our free planning wizard will provide your planning category, savings estimates, and insightful information about any potential problem assets. It will also reveal which products may apply to your situation.


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If you are still trying to understand how to pay for your loved one's care, then we encourage you to keep reading...

Medicare Coverage for the Nursing Home

Some seniors may assume Medicare will cover all or a portion of their long-term care costs. But this is only the case for a limited amount of time and only after an eligible hospital stay. You see, Medicare was actually designed to cover a short-term stay in a care facility. If you are an inpatient at a hospital for at least three days and are then moved to a skilled nursing facility, you may be eligible for Medicare coverage for up to 100 days. The first 20 days are covered in full by Medicare, while days 21 through 100 require a copayment of $176 per day in 2020.


Beyond any Medicare benefits, you are typically left with a few options:

  • Use a long-term care insurance policy ( purchased while you were young and healthy)
  • Subsidize or eliminate the cost using Medicaid Benefits for long-term care.
  • Reverse mortgage or other equity-based loan
  • Pay out-of-pocket

Many seniors fail to plan ahead and a care facility isn't authorized to provide legal or financial advice. So, many people assume they have to pay out-of-pocket until their asset list hits zero in order to qualify for Medicaid benefits - which simply isn't true. For those who failed to plan ahead, we recommend Medicaid planning.


Read More: Medicare vs. Medicaid: Paying for Long-Term Care


Planning Ahead for Long-Term Care

The best way to pay for a nursing home or other long-term care stay is to plan ahead before you require care. This is what we call advance planning and may include a variety of legal or financial-based asset-protection strategies, including purchasing Long-Term Care Insurance. Of course, this takes some forethought and doesn’t have any sort of urgency attached to it. If you are a healthy adult who wants peace of mind regarding your financial future, we recommend you form a long-term care plan as soon as possible. Another option is to consider using an Asset Protection Trust to shield your assets from probate and start the five-year lookback period for Medicaid benefits.

If you would like to get in-depth with advance planning, we recommend reading a free copy of our planning guide Paying for Long-term Care - the Essential Senior Guidebook.


Read More: All About Advance Planning for Long-Term Care


Protecting Your Life Savings in the Moment

If you have not planned ahead and are facing a nursing home stay, it’s not too late. Since nursing homes can cost upwards of $8,000 per month, many seniors risk depleting their entire nest egg paying for care. Fortunately, there is another way: Medicaid planning. Rather than drain your life savings until you meet Medicaid’s financial requirements, you can protect your assets while accelerating your eligibility for benefits. This is a great way to preserve what's left and put your money to better use, rather than depleting it on your cost of care. You can help ensure your spouse's livelihood after you are gone, or leave a legacy to your children. And, Medicaid pays for the majority of long-term care costs in the United States. Using a Medicaid Compliant Annuity to convert your assets to the income column is a great way to accelerate your loved one's benefits and reduce their cost of care.


Read More: What is a Medicaid Compliant Annuity?


Need free planning advice? call us today! (844) 412-4222



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"Paying for Long-Term Care - The Essential Senior Guidebook"

This guide takes a deep dive into the landscape of long-term care and how to pay for it without going broke, including the answers to your top questions surrounding Medicaid.

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