Medicare rarely pays for assisted living, nursing home or custodial care. When it does provide coverage, it is only for the first 90 days of care, and only for care provided in connection with a Medicare-qualifying hospitalization. To qualify for Medicare coverage, the nursing facility must be a skilled-care facility, which most assisted-living facilities are not. Medicare may help pay for some medical services you receive while in the assisted-living facility, but will generally not cover the cost of the facility itself.
Qualifying Nursing Home Care
Medicare covers care in nursing facilities only if the patient requires skilled nursing care in order to recover from an acute injury or illness. For the purposes of determining Medicare eligibility, an acute medical condition is one that is expected to improve with treatment. If the condition is chronic, meaning the condition is permanent and is not expected to improve, Medicare does not pay benefits.
Home Health Care Alternative
Medicare does pay for medical services delivered at home, rather than in a health care facility, in some circumstances. Generally, the patient must be home-bound for Medicare benefits to be payable. Medicare may pay for some services in the home that would otherwise be provided in an assisted-living facility.
Medicaid
Medicaid does pay for nursing home and assisted-living facilities. However, in order to qualify for Medicaid coverage, the insured must first exhaust his own personal assets down to a few thousand dollars. However, exemptions to this requirement do exist and vary by state. Home equity is frequently exempted from Medicaid qualification asset limits, as is a small allowance for a car and a limited amount of life insurance.
Long-Term Care Insurance
Long-term care insurance is private insurance that pays a daily or monthly benefit in the event of a chronic medical condition, typically resulting in the loss of two or more activities of daily living, or in the case of a cognitive disorder such as dementia or Alzheimer's. After a minimum number of days has elapsed, known as an "elimination period," long-term care policies typically pay up to a maximum daily benefit for a specific number of years. Some policies also pay for home health care. Owning such a policy may help you protect against the need to impoverish yourself and your family in order to qualify for Medicaid.
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