To what extent will Medicare cover long-term care?

In the end, our family’s solution felt like putting together a puzzle. We relied upon multiple family members, respite care providers and home care professionals to provide my grandmother the care she required.

The financial resources to pay for care also changed over the years. We combined Medicare’s assistance with a veteran’s aid program and over time, she became eligible for an increasing level of public assistance.

Ultimately, we were fortunate to be able to provide for my grandmother in the location of her choosing. But it wasn’t easy, and it was definitely a confusing journey.

In hindsight, our confusion about how Medicare works with long-term care shouldn’t have surprised me, as I was unaware of even the basic terminology associated with long-term care.

And sadly, I know from my own experience talking with hundreds of families over the years, that most Americans end up facing the prospect of long-term care without even this basic understanding. They find themselves trying to problem solve before they’re even familiar with the problems.

The good news is that while Medicare’s role in long-term care is complicated, you can head off much of the headache that comes with the financial burden of long-term care by understanding these basic concepts:

The basics of paying for long-term care

Custodial care refers to personal care given to individuals to help them with activities of daily living (ADL), which include bathing, dressing and transferring themselves from seated to standing or in and out of bed. Also known as non-medical care, custodial care can be, and frequently is, provided by persons without professional medical training.

Skilled care on the other hand, requires the provider to have professional medical training and licenses. In a home environment, the distinction between who is providing these types of care is fairly clear. In a hospital environment, it is less evident. Nurses, for example, provide both medical and custodial care at the same time especially in smaller hospitals.

The simplest test to determine whether Medicare will or won’t pay for care is to consider whether the care being provided is custodial/personal care or medical/skilled care. Medicare does not cover the custodial care, but it will pay for skilled care (or at least a portion of it).

Long-term care scenarios

Unfortunately, these seemingly uncomplicated distinctions become more complicated, especially as the patient’s need for care changes from temporary to long-term.

For Medicare to pay for care provided in the home, it must be medical care, prescribed by a doctor, and on a part-time basis. The individual must also be “confined,” which means they are unable to leave their home without assistance.

In adult day care, most if not all of the care being provided is considered non-medical – and therefore, Medicare does not pay for it. However, there are now adult day health care (ADHC) centers that provide medical care as well as non-medical. In these environments, if the care is prescribed and medically necessary, it falls within Medicare’s coverage guidelines.

The same applies to assisted living communities which have, over time, increasingly offered medical services, Medicare will pay for those services, but not for the costs of room and board.

Skilled nursing facilities rules more complex

The rules involving Medicare and nursing homes or skilled nursing facilities are more complex.

Medicare will pay for the cost of skilled nursing, including the custodial care provided in the skilled nursing home for a limited time, provided 1) the care is for recovery from illness or injury – not for a chronic condition and 2) it is preceded by a hospital stay of at least three days.

For the first 20 days, Medicare will pay for 100 percent of the cost. For the next 80 days, Medicare pays 80 percent of the cost. Skilled nursing beyond 100 days is not covered.

Individuals who have certain types of Medicare supplemental insurance can get additional assistance towards defraying the cost of nursing home/skilled nursing care. Some plans will cover 100 percent of the coinsurance payment required by Medicare. This means that between Medicare and the Medigap plan, 100 percent of the cost of skilled nursing for 100 days will be covered.

Beyond Medicare assistance

Although Medicare’s overall benefits are limited for long-term care, there are many other state and federal public assistance options that can help. In addition, there are financial resources from non-profits, foundations and the Veteran’s Administration as well as private loan options that can help.

As always, it’s well worth your time to research online resources – including this Resource Locator Tool – to determine whether you or your loved one are eligible for resources that can help pay for assisted living or pay for home care.