The Wise and the Wary
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Medicare Will Cover Nursing Home Expenses
Misconception #9 of "The 12 Biggest Misconceptions of Estate Planning Clients"
Unlike the needs-based Medicaid program discussed in the previous blog, the Medicare program is an entitlement program. If you meet all of the eligibility requirements, you will be covered by the program, even if you’re a multimillionaire.
As a general rule, Medicare will not pay for long-term care. This includes both medical and nonmedical care for those who have a chronic disease or disability. Nonmedical care would be help with activities of daily living, such as bathing, eating, dressing, toileting, and getting in and out of bed. This “custodial care” may be needed for years, but, again, isn’t covered by Medicare.
Medicare will pay for skilled nursing care—any care performed by a licensed nurse—but only if all of the following conditions are met:
- Your doctor has certified that you need skilled care or rehabilitation care (not just custodial care).
- You’ve been hospitalized for at least three consecutive days.
- You’ve entered a nursing home within 30 days of your discharge from the hospital.
- You need skilled care or rehabilitative care for the same medical condition for which you were hospitalized.
- You haven’t used up your benefit period allowance of days or your lifetime reserve days under the Medicare program.
If all of those statements are true, Medicare will pay for all of the nursing home costs for the first 20 days, and some of the costs for the next 80 days (you’ll need to pay the first $133.50 per day as coinsurance). After day 100, you’re on your own.
Because of these restrictions, the vast majority of nursing home residents need alternative funding. The three possibilities are self-funding, long-term care insurance, and Medicaid. The next blog series will cover these options in more depth.
By Deborah Hoskins, JD, CFP
The Wise and the Wary Blog
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