Paying for Home Care: Financial Options, Aid, and Assistance
As your parent or other loved ones ages, your family is probably starting to consider the costs that come with their care, especially if they want to stay in their own home and receive care. Although you might worry that your family can’t afford home care, you may be surprised by how many options there are to help you cover expenses. In fact, when you break it down, home care can be a much more affordable and cost-effective option than assisted living or a nursing home.
Here are some funding options that can make paying for home care services easier.
Seniors and their families might be surprised to find that insurance does cover some expenses associated with home care services. There are three forms of insurance that you can look to for assistance with home care expenses:
Current Medical Insurance Policy - Your aging loved one’s current insurance policy may cover the cost of home care, especially if this type of care is prescribed by a physician. You can also look for supplemental insurance policies to cover this care option.
Long-Term Care Insurance - Has your parent or senior loved one purchased long-term care insurance? If so, this policy would help with paying for home care. However, your parent needs to have purchased this policy before the home care need arose to avoid high premiums. It’s important to note that the cost for some on-demand home care providers, like CaringOnDemand, can be covered by long-term care insurance.
Life Insurance Conversions - Life insurance conversions are another option to help cover home care costs. If you choose the convert or sell your parent’s life insurance policy, this may mean that you won’t be able to allocate these funds to future funeral expenses. That’s why this option isn’t the right choice for everyone.
Medicare and Medicaid
Medicare and Medicaid can provide healthcare financial support for seniors’ home care costs. Let’s look at Medicare first. In April of 2018, the Centers for Medicare and Medicaid Services announced that some Medicare Advantage plans may offer supplemental health care through the Medicare PACE (Program of All-Inclusive Care for the Elderly) Program. PACE, also known as the LIFE Program (Living Independence for the Elderly), is still limited based on the state you live in, but this could be a potential source of assistance when paying for home care.
Medicaid is another option for paying for senior care. Many low-income seniors rely on Medicaid to provide healthcare coverage and assistance. Some of your costs may be covered through Home and Community Based Services (HCBS) programs.
Veteran seniors have a number of assistance options they can pursue. If your loved one was in the military, you should look for specific assistance programs to help pay for their care. Look into options like Veterans-Directed Home HCBS programs for assistance. Your family can also consider Veterans Affairs Respite Care or see if your Veteran’s Medical Insurance could apply to home care costs.
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Non-profit organizations sometimes offer financial or care assistance for individuals with specific conditions, like Alzheimer's disease, cancer, diabetes, kidney disease, and more. Has your senior loved one recently received a specific diagnosis similar to the ones listed? If so, you should look into the specific organizations dedicated to these illnesses. Contact non-profit organizations associated with these conditions to learn more about the opportunities they offer.
It’s common for individual states to have their own senior care assistance programs. These programs help alleviate the financial burdens associated with care. In fact, most states have in-home assistance programs for low-income seniors who are not eligible for Medicaid. Because each state is different, you should research your state’s programs to learn more about the opportunities that are available.
You may have a number of family members who may be able to help pay for home care expenses. Talk to close family members about whether or not they are willing to contribute, and how much they are able to provide.
One home care pricing model that makes it easy for multiple family members to contribute is the care-the-minute model. Care-by-the-minute pricing allows families to pay for the exact amount of care their senior loved one needs, down to the minute. So, if you loved one only needs 30 minutes of care, you don’t have to pay the common four-hour minimum that most agencies charge. With care-by-the-minute pricing, family members can easily pitch in, divide costs, and provide support on a daily, weekly, monthly, or as needed basis.
Before making any decisions about how you will be paying for home care services, you should take a close look at your parent’s or senior loved one’s income. The amount of money they bring in each month or have saved could go toward home care costs. In fact, if your loved one only needs a minimal amount of support, their pension, social security check, savings, or other form of income could possibly cover home care expenses. You could also sell items like cars or additional property to help with costs. Evaluate your parent’s financials with them to determine what they are able to afford.
Loan or Reverse Mortgage
Taking out a loan is a common option for anyone facing big expenses, including paying for senior home care. As long as your parent’s income or other family members can cover the monthly loan payments, this could be a possibility for your loved one’s home care expenses.
Another option many seniors consider is securing a reverse mortgage to cover the cost of their care. With a reverse mortgage, seniors essentially sell their home to a bank or other lender, receiving the equity they have in their home in cash. They can still live in the home, but once they move or pass away, the loan must be repaid or the bank assumes ownership of the property.
Securing a loan or reverse mortgage is a big decision, and one that no senior should make alone. These financial steps should be discussed with the entire family, ensuring this is the best choice for everyone.
Now that you know more about the many options for funding senior care, you’re ready to choose the course you want to pursue. Talk to your senior loved one and other family members about each of these options to determine which one is the best choice.
It’s also helpful to remember that you can cut costs by choosing a care-by-the-minute pricing option. This allows your family to only pay for the care your loved one actually needs. You also save money by partnering with a provider who does all the work for you. You don’t have to search for candidates, conduct background checks, or get insurance to cover the safety of the caregiver in your home. When you work with a provider like CaringOnDemand, your family benefits from the convenience and affordability this option provides.
On-demand care is helpful and convenient for seniors. Find care options near you today.