As older adults age, the need for long-term care increases, especially when they are unable to perform activities of daily living (ADL) such as dressing, bathing or preparing meals. Nursing home or skilled nursing facility (SNF) care may be appropriate for these older adults. But it’s one of the biggest expenses a Medicare beneficiary can face. The average monthly cost of a semi-private room in a nursing home is $7,908, according to the report. AARP. Options to pay for such care are limited, said Lori Smetanka, the agency’s executive director. National consumer voice for quality long-term carea nonprofit consumer advocacy organization based in Washington, D.C.
Nursing home coverage under Medicare is limited
health insurance won’t pay nursing home care– Except for certain accommodation under certain conditions. Medicare will pay for nursing home stays if a patient is determined to need skilled nursing services, such as help recovering from surgery or a medical problem such as a stroke, but not for more than 100 days.
“For the first 20 days, health insurance will cover 100% of the cost,” Smetanka noted. After that, Medicare pays 80%, and members pay the remaining 20%.
To qualify for such coverage, Medicare members need to spend at least three days in a hospital before the agency approves payment for nursing home rehabilitation or skilled nursing care, she added.
“Staying in the hospital for three days is a challenge because the hospital discharges patients faster,” Smetanka explained. “They usually don’t stay for three nights.”
Additionally, hospitals often tend to use what is known as a watch status, where patients are technically not admitted. “This trend affects the ability of beneficiaries to obtain Medicare coverage for skilled care in rehabilitation or nursing homes,” Smetanka said.
Observation status gives doctors and other staff 24 to 48 hours to assess whether a patient should be admitted for inpatient care or discharged. Society of Hospital Medicine.
The association noted in a 2017 report that observation status can be costly for Medicare patients because the agency classifies it as ambulatory care, meaning beneficiaries may be required to pay for their time in it. share, as a deductible, coinsurance or co-payment, “Hospital Observation Nursing Issues“.
What’s more, some patients are on observation for longer than the usual 24 to 48 hours, said Toby Edelman, senior policy attorney at the Center for Medicare Advocacy, a national nonprofit legal organization.
To address the long observation period, Edelman said, Medicare implemented the two-midnight rule, which states that doctors should treat patients as inpatients when they anticipate they will need to be hospitalized by at least two midnight.
However, the rule means that the two midnights spent under observation don’t count towards the three-day hospital stay a patient needs to qualify for nursing home or SNF coverage. “It’s not just about length of stay, it’s about how patients are categorized,” Smetanka said. “If a patient is classified as ‘observation,’ the time spent — no matter how long — may not count toward the three days required for Medicare to pay for skilled nursing facility care.”
To be classified as an inpatient, a patient actually needs to be formally admitted as an inpatient, Edelman said. It is important for patients to ask their doctor, nurse or hospital staff if they have been admitted.
Long-term care insurance or Medicaid
One way to pay for a nursing home or living in a similar setting is to purchase long-term care (LTC) insurance. According to AARPMost people buy LTC insurance between the ages of 55 and 65. Assuming both applicants have some health issues, average annual premiums for LTC coverage in 2021 range from $2,220 for a single male age 55 to $5,265 for a single female age 65, AARP noted.
Another way to pay for nursing home care is to apply for your state’s Medicaid program, Smetanka explained. Because Medicaid is a federal-state partnership, the federal government issues some rules, and the states also issue rules.
Each state sets eligibility requirements for nursing home care. Part of the process involves reviewing each applicant’s assets. “To qualify, your spending must be below a certain financial level, and you need to meet eligibility requirements, which means you need to demonstrate that you need help with a certain number of activities of daily living,” Smetanka added.
Because each state regulates Medicaid eligibility differently, it’s a good idea to hire an attorney familiar with senior law to guide you through the process and help you find the best long-term care options, suggests Smetanka.