Who Pays for Long-Term Care?

Private Individuals

Most long-term care is paid for by the people receiving the care or by their families. Other sources of payment include Medicaid (Medical Assistance), Medicare, veterans' payments, and private insurance. Many individuals who require extensive long-term care eventually "spend-down" their savings and other resources and become eligible for Medicaid.

Medicare

Medicare is the federal program that helps pay hospital and medical costs for those who are 65 or older and some disabled persons. It provides very limited coverage for short periods of time for nursing home and home health care but does not cover any long-term care services for extended periods of time.

Nursing Home Care

If a nursing home stay is approved by Medicare, then Medicare pays in full for up to 20 days of skilled nursing care in a skilled nursing facility approved by Medicare. However, Medicare will pay for your stay only if it follows a hospitalization of at least three days and you enter a Medicare-certified nursing home within 30 days after hospital discharge. From the 21st to the 100th day, Medicare pays part of the cost if the stay is still approved by Medicare. Medicare pays nothing beyond the 100th day. Very few nursing home stays are covered by Medicare. This is both because many nursing homes do not participate in the Medicare program and because Medicare defines "skilled care" in a very restrictive way.

Home Health Care

Medicare covers only those home health care visits that Medicare considers to be medically necessary. Medically necessary care is defined quite narrowly and you must meet certain other criteria before Medicare will pay for the care. For example:

• The care must include part-time skilled nursing care, physical therapy, or speech therapy;
• You must be confined to home;
• Your doctor must set up a home health plan; and
• The agency providing services must participate in Medicare.

Many home health care visits do not meet Medicare's definition of medically necessary care. Therefore, Medicare will not pay for them.

Medicare provides only limited coverage for long-term care related primarily to recuperating from a sickness or injury. Medicare pays only for skilled nursing care and medically necessary services. You should not rely on Medicare to pay for your long-term care needs.

Medicaid

Medicaid, also known as Medical Assistance or Title XIX, is a government health care program paid for by state and federal governments. To be eligible for Medicaid:

• You must be 65 or over, disabled, or in a family with dependent children;

and
• You must have low income and few assets; or
• You must be paying so much money for health care that you have very little income left.

If you are eligible, Medicaid pays for most health care costs, including nursing home and community-based care.

Nursing Home Care

Medicaid is a major source of payment for nursing home care. About 64% of all nursing home residents in Wisconsin receive help with their nursing home costs. To qualify for Medicaid nursing home benefits, you must be a nursing home resident and require medical, nursing, and/or therapeutic care on a daily basis, and be under a doctor's plan of treatment. Even after you become eligible for Medicaid, you will have to use most of your personal income first to pay nursing home bills. Medicaid will pay remaining costs (Wisconsin Department of Health and Family Services).

When first admitted, many residents of nursing homes who receive Medicaid are able to pay for their care themselves. Over the course of a long nursing home stay, many people use most of their savings to pay for their care, and then become eligible for Medicaid (Wisconsin Department of Health and Family Services).

Home Health Care

Medicaid may pay for services you receive in your home. However, you must be under a doctor's plan of care, have medical needs that can be met in your own home, and receive services from a home health care agency certified by Medicaid.

Personal Care

Medicaid also pays for personal care, such as assistance with bathing, dressing, eating, or getting in and out of bed. To be paid by Medicaid, you must be under a doctor's plan of care and you must receive services from a personal care agency certified by Medicaid. You may also be eligible for a limited amount of necessary household help, such as grocery shopping, meal preparation, or laundry.

Community Options Program

If you live in Wisconsin, you may be eligible for the Community Options Program. This program provides community-based long-term care services if you have a limited income and assets, and would otherwise need to be in a nursing home. If you qualify based on limited income and assets, all or part of the cost of the care can be paid by a special state-funding program or, in some cases, Medicaid. The Community Options Program offers a wide range of services including personal care, respite care, adult day care, transportation, and even necessary help with household chores. To learn more about the Community Options Program, contact your county and tribal Community Options Program Coordinator (http://www.dhfs.wisconsin.gov/LTC_COP/CONTACTS.HTM). Your local aging office is a good source of information for older people as well.

Medicare Supplement Insurance

Medicare supplement insurance policies do not provide coverage for long-term care. They are designed to supplement Medicare and provide very limited coverage for nursing home and home health care. For more information on the benefits included in Medicare supplement insurance policies, consult the booklet Wisconsin Guide to Health Insurance for People with Medicare which is available from the Office of the Commissioner of Insurance.

Comparison of Costs Incurred for Nursing Home Care* * Centers for Medicare & Medicaid Services (2002)