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For many seniors, cost is the biggest obstacle to finding a good senior living residence. Prices for assisted living and nursing homes vary depending on a number of factors, but on average, seniors pay $2,000 to $5,000 per month. While those amounts are too high for some seniors to pay out of pocket, the good news is that financial assistance, insurance payments, veterans benefits and more resources are available. Paying for senior living with no money is doable when you know how to draw from the pool of resources in your state.
If you do not have the monthly income to pay for an assisted living residence, you may be surprised to find you can draw money from other sources; however, Medicare is not one of them. Long-term care insurance will pay for assisted living, but you may have to jump through some hoops to receive your benefits. Many long-term care insurance companies automatically deny request for payment the first time. To get the insurance company to pay, you may need a doctor's note describing your physical limitations that require help in at least two areas of activities of daily living. To speed along the process, ask a representative from the assisted living home to act as an advocate on your behalf.
Life insurance is another resource you may already have that can cover the costs of assisted living. There are many ways life insurance can help pay. If you want your life insurance to remain in place but are comfortable having less to leave to your beneficiaries, pull money out from the built-up cash value. If you are ready to cash out completely, expect to pay income tax on the full amount. Some policies do not allow cashing out before death. In this case, you may consider selling the policy to a third-party company in order to receive 50 to 75 percent of the original policy's value. A final option is life insurance conversion, which converts a life insurance policy to a long-term care payment plan; the downside to this option is that your policy value will be significantly reduced.
The Veterans Benefits Administration offers financial assistance for assisted living care, but only in certain circumstances. In order to receive this benefit, you or your spouse must have served for at least 90 days during a period of conflict. Additionally, you must have a medical and financial need. You will need to apply through the VA and show military discharge papers and medical documents.
If you own your home and do not want to sell it, consider a reverse mortgage, which allows you to draw cash in a large lump sum or over time. A reverse mortgage is not for everyone, and there are a number of fees for the service, so be sure you understand the fine print before proceeding. Renting out your home is another option that will supply you with monthly income.
Medicaid is one of the most common ways to pay for a nursing home when you have no money available. Even if you have had too much money to qualify for Medicaid in the past, you may find that you are eligible for Medicaid nursing home care because the income limits are higher for this purpose. The specific income requirements will depend on your state. As it is a separate program, Medicare does not pay for long-term nursing home care, although in some cases, the insurance will cover a short-term stay (under 100 days) in a nursing home.
Another option is to seek assistance from your state's agency in the the National Association of Area Agencies on Aging. This government program helps seniors access the local financial assistance services available to them.
As with assisted living described above, long-term care insurance, life insurance, veterans benefits and reverse mortgages can also pay for nursing home care.
Once you find an assisted living community or nursing home you can afford in the present, it is important to ensure you can afford to stay there in the future if your resources run out. Always ask to see the care company's policy in writing, so you know what will happen if your money runs out. In most cases, the bottom line is that yes, the care home can evict a resident who can no longer afford to pay.
The requirements to kick a resident out for failure to pay vary from state to state. Generally, assisted living and nursing homes must notify you and your family at least 30 days before discharge, and also create a report summarizing your current mental and physical health status and your post-discharge plan of care.
If your money runs out and your family is not able to step in and cover costs, your options will depend on your state and whether you are residing in an assisted living or nursing home. At a nursing home, federal law entitles you to the right to file a hardship waiver with your state's Department of Health and Human Services. A hardship waiver must document how the move would endanger your health or your access to shelter and food.
While a federal hardship waiver does not apply to assisted living facilities, you can still reach out to government agencies, such as your Area Agency on Aging or your local long-term care ombudsman, which every state is required to have under the Federal Older Americans Act. Your ombudsman may be able to negotiate with the facility, secure financial aid to pay for your care or find you a new home. Finally, a lawyer through your local Legal Aid agency may take your case at no cost to you.
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