Nursing Homes

According to the U.S. Department of Health and Human
Services and the American Association of Homes and
Services for the Aging there is a about a 70% chance
people over the age of 65 will need some sort of long
term care services. This percentage increases with
age. The average length of stay is 2.5 years. Of course
this can vary depending on the health needs of
individuals. National average annual costs of a private
room in a nursing home are about $77,000 ($213/day)
and $35,000 ($98/day) for an assisted living facility. The
price tag for an average stay at these facilities can total
$192,500 and $87,500 respectively and costs will only
increase as time goes by.

Medicare will pay in full for up to 20 days
if you are in a Skilled Nursing Facility
following a recent hospital stay. If your
need for skilled care continues, Medicare
may pay for the difference between your
co-payment of $133.50/day for days
21-100. After day 100 Medicare does
not pay.

Medicaid may pay for care in a
Medicaid-certified nursing home if you
meet functional and financial eligibility
criteria. Financial eligibility criteria
means you must only have assets
totaling $2,000. This means you must
use whatever financial resources you may
have before Medicaid will begin paying.
This is what is referred to as spend-down.
Any transfers you make into an estate
or some other vehicle must occur 60
months prior to applying for
admittance into a nursing home. This is
referred to as the look-back period.

As you can see the potential for financial
distress is a very real possibility for many
seniors and baby-boomers. Planning for a
possible health care situation that may or
may not happen is often delayed until it is
too late to avoid liquidating your assets.
Although we are required to carry
homeowners insurance, most of us
would never think of not having it in
the case of fire, storm damage or some
other housing related emergency.
However, the probability of a home fire
fatality is one half of one percent. As
mentioned above, 7 out of 10 people over
the age of 65 will require some form of
long term nursing care.

With the proper planning and guidance you
can reposition your existing assets so that
you are prepared for long term care if need
be and at the same time be able to enjoy
retirement and the quality of life you
have worked and planned for. There are
legitimate alternatives to provide security
for yourself and your loved ones,
alternatives to provide an income during
retirement and to keep your assets healthy.