Friday, October 11, 2013

What Are Your Payment Options for Assisted Living?

Most people want to be able to live on their own their whole lives. Unfortunately, your health may start to deteriorate to the point that you can no longer take care of yourself. Your family members may not be able to give you the care that you need either. You may need to eventually consider living in an assisted living facility. 

Many people are reluctant to use one of these facilities because they feel they are worried about paying for it. Fortunately, there are several ways that you can pay for assisted living.

Utilize Long-Term Care Insurance


Long-term care insurance will pay for you to go into a nursing home or assisted living facility. The average policy for a 55 year old will cost about $3,500 a year. These policies clearly aren’t cheap, but you will probably be a lot better off purchasing them than trying to pay out of pocket down the road.

Most long-term care policies should cover everything that you need. They average policy will pay for about $4,470 worth of services a month. That is nearly 60% more than the median cost of living in an assisted living facility. However, you should ask your insurance carrier what services they will cover and find out how much different facilities cost long before you need them.

Consider a Bridge Loan While Selling Property


You may have trouble paying the premiums for long-term care insurance while you are still working. You may want to take out a bridge loan instead. Bridge loans will pay for your stay at an assisted living facility when you can’t afford to pay upfront. A number of companies offer them.


You will need several people to cosign the loan for you. They will be collectively responsible for making the payments while you are in the assisted living facility. However, one person will usually be appointed to be responsible for making the payments.

The rates on these loans are usually very reasonable. They typically offer a line of credit of up to $50,000 with the same rates as secured home loans. They are ideal for people who are in the process of selling their home to pay for assisted living.
Look into Medicaid and Medicare Coverage

Many people are unrealistic about what Medicare and Medicaid will cover. They typically aren’t feasible payment options when you have other options available. However, you may still be able to take advantage of them.

Most states offer some form of Medicaid waiver that will allow you to pay for some of your assisted living costs. However, residents in Louisiana, Kentucky, Alabama, Pennsylvania and South Carolina do not offer such coverage. You may want to consider relocating to another state if you are a Medicaid recipient and suspect that you may need to enter an assisted living facility within the next few years.

Medicare is also an option worth considering, but you generally can’t use your Medicare coverage until all other options have been exhausted. You will need to deplete all of your assets first.

About the author: 

Kalen is a freelance finance and lifestyle writer. He shares tips to help seniors live comfortably after retirement, such as using Senior Apartments in Kalamazoo Michigan.


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1 comment:

  1. Finances have always been an issue in long term care. Thank you for sharing these financial strategies. Since we find this helpful, we decided to share this to our readers through LTC Option’s Weekly Digest. You can read the whole compilation here.
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