10 Oct How to Pay for Assisted Living: What are My Options?
Money is a stressful topic, and when it comes to paying for assisted living, it can be a confusing topic as well. The rules and regulations for insurance and financial planning can be daunting if you’ve never dealt with them before. Finding how to pay for assisted living can be a challenge, but it doesn’t have to be.
We’ve highlighted some of the most common choices when it comes to paying for assisted living, so you can be prepared for your next steps.
How to pay for assisted living
It’s important to be informed about your options in regards to paying for assisted living. Choosing an option for payment without being properly educated could result in a financial disaster for you or your family.
If you or a loved one have money you’ve saved up, it is possible you could pay for assisted living out-of-pocket. However, be aware of the monthly costs for the assisted living facility you are considering, because you can eat up your savings faster than you may think. This option may work short-term, but unless you have significant savings, this can be difficult.
Long-term care insurance
This kind of insurance is intended to help people who need help with daily activities for an extended period of time and can help cover assisted living services. Coverage can vary depending on your wants and needs and should be assessed prior to buying. The younger you are when purchasing coverage, the cheaper it will be. If you wait until you are older and possibly ill, you will have to spend more than you would have otherwise.
Be sure to check with your assisted living facility to find out whether they accept the kind of insurance you have or are purchasing. If they do not, you will have to begin the hunt for a new facility again to find one that takes your insurance.
If you or a loved one have previously served in the military, it is possible you are eligible for VA benefits. These benefits may be able to help you in paying for assisted living for both veterans and spouses. Check with your local VA in regards to your eligibility to receive these benefits.
The rules dictating the usage of Medicare and Medicaid for assisted living vary from state to state. For example, 43 states and Washington D.C. allow for Medicaid to pay for some of the costs associated with assisted living. Medicare, however, does not cover assisted living. The most assisted living coverage one can expect from Medicare is a brief stay after an illness or surgery.
Bridge loans are short-term temporary loans one can use while waiting for a house or other piece of property to sell. It gives you the money in a quicker period of time so you or a loved one can enter assisted living while waiting for the house to sell. These loans typically last six to twelve months and should be used with caution. If the house or property does not sell in that time, you will have a large loan you are in charge of paying back while waiting for the house to sell.
Annuities are established before your retirement by paying a single payment or series of payments to an insurance company. In return, the insurance company provides you with a set of fixed payments. If you are receiving money from an annuity, it can be utilized in paying for your assisted living care.
Reverse mortgages are available to homeowners who are 62 years old and older and provide a loan against the equity of their house, giving cash to the homeowner. This supplemental income is often used for healthcare costs including assisted living. The borrower does not pay back the loan until the home is sold.
Life settlements work to convert your life insurance into money that can be used immediately for your long-term care needs. The insurance company will buy your life insurance policy from you, meaning you no longer have to pay the premiums. This also means that upon your death, your life insurance company will receive the settlement, not your heirs.
How can I find the best-priced facility?
Finding the best-priced facility for you or a loved one shouldn’t be difficult with the right preparation. Some of the steps you can take include:
- Plan ahead and do your research, check websites and make phone calls for facilities
- Consider a location outside of a major city — facilities in the suburbs are often more affordable
- Choose a smaller living space
- Talk to others about their assisted living facilities and compare prices
Be aware that the cheapest facility may not always be the best facility, and always explore all of your available options. Don’t immediately choose one facility based on price or location if you have not taken a look at all of your possibilities. Be careful when choosing the facility that will be a new home for you or a loved one.
Do you have questions about how to pay for assisted living?
Contact us at Culpepper Place in Olive Branch, MS. We can go over payment options and help you choose the best payment method for you and your loved ones.