When a loved one begins to need senior care, for most families it’s uncharted territory. Not only is it natural to have questions, we know the sheer volume of information to consider can be overwhelming too, particularly when it comes to finances. To help, we’re answering some of our most frequently asked questions on how to pay for senior care.

Q. HOW MUCH DOES SENIOR CARE COST?

A. SENIOR CARE CAN BE PROVIDED AT HOME OR IN A COMMUNITY SETTING. ACCORDING TO THE 2019 GENWORTH COST OF CARE SURVEY, THE AVERAGE MONTHLY COSTS ARE TYPICALLY AS FOLLOWS:

Senior Care at Home

• Home Health Care
  • Homemaker Services —$4,290
  • Home Health Aide Services —$4,385
• Adult Day Care 
  • $1,625

Care in Senior Living

• Assisted living
  • Private, one-bedroom – $4,051

While there is little published data on average monthly costs for independent living and memory care because they can vary so greatly, typical ranges are as follows:

• Independent Living 
  • $1,000 to $4,000 per month
• Memory Care 
  • $2,000 to $7,000 per month

Senior Care in Skilled Nursing

• Semi-private room – $7,513
• Private room – $8,517

Q. WHAT ARE THE DIFFERENCES IN TYPES OF CARE?

A.  THE MAIN DIFFERENCES HAVE TO DO WITH THE SETTING AND THE TYPE OF CARE PROVIDED.  FOR EXAMPLE, SENIOR LIVING IS ACTUALLY A CONTINUUM WITH LEVELS OF CARE BASED ON SPECIFIC NEEDS.  HERE’S AN OVERVIEW:

Senior Care at Home

• Home Health Care
  • Homemaker services – Help with household tasks that cannot be managed alone such as cooking, chores and transportation.
  • Home health aide services – “Hands-on” personal care, but not medical care.
• Adult Day Care – Care provided during normal business hours, five days a week that may include meals, medication assistance, fitness, enrichment programs and social activities.

Care in Senior Living

• Independent Living – Designed for seniors who need little daily assistance but want carefree living with a range of social opportunities. 
• Assisted Living – Provides housing, onsite care and support with daily activities as well as amenities and social opportunities similar to independent living. 
• Memory Care – Designed for those with Alzheimer’s disease and dementia, memory care includes 24/7 support, a secure, nurturing environment and specially-trained staff. 

Senior Care in Skilled Nursing

• Skilled Nursing Care – The highest level of supervision and care with 24/7 nursing and physical, speech and occupational therapists also onsite.

Q.  WHAT AFFECTS THE COST OF SENIOR CARE?

A. THERE ARE TYPICALLY THREE MAIN FACTORS THAT AFFECT THE COST YOU’LL PAY:

• Level of Care – Basically, the higher the level of care the higher the cost. For example, onsite care is not provided in independent living whereas in memory care, specialized care is available 24/7 which accounts for the cost difference.
• Geography – Where you live also affects the cost of senior care so you might consider going outside the city, even a different state to potentially pay less.
• Amenities – This really has more to do with a community setting, but as with anything else, convenience and luxury comes at a cost. Consider whether that private two-bedroom is really necessary or if a studio would suffice. Similarly, concierge services and private transportation may not be necessities either.

Q.  ISN’T STAYING HOME ALWAYS CHEAPER THAN A COMMUNITY SETTING FOR SENIOR CARE?

A.  NO NECESSARILY.  MANY FAMILIES INCORRECTLY COMPARE THE MONTHLY COST OF A SENIOR CARE COMMUNITY TO THEIR MORTGAGE OR RENT ALONE WHICH IS NOT A FAIR COMPARISON.  RATHER, YOU MUST COMPARE TO THE TOTAL MONTHLY COST OF LIVING AT HOME WHICH ALSO INCLUDES YOUR FOOD, UTILITIES, HOME MAINTENANCE, PROPERTY TAXES, INSURANCE AND ENTERTAINMENT COSTS. WHY? BECAUSE THESE THINGS ARE TYPICALLY INCLUDED IN THE MONTHLY COST OF THESE COMMUNITIES.

What’s more, don’t leave out the cost of home health care (and/or home modifications) to support your loved one’s needs. After including all of this in your budget, you may be surprised to find staying home can actually be MORE expensive in some cases!

Q. HOW MUCH DOES MEDICARE, MEDICAID AND/OR HEALTH INSURANCE HELP IN PAYING FOR SENIOR CARE?

A.  NOT AS MUCH AS YOU MIGHT THINK.  HERE’S WHAT TO KEEP IN MIND:

Medicare

Only pays for senior care if your loved one requires skilled services or rehabilitative care: 

• In a nursing home for a maximum of 100 days
• At home if you are also receiving skilled home health or other skilled in-home services. 

It does not pay for non-skilled assistance with Activities of Daily Living (ADL), which make up the majority of senior care services. 

Medicaid

If does pay for the largest share of senior care services, but to qualify, your loved one’s income must be below a certain level and you must meet minimum state eligibility requirements based on the amount of assistance needed with ADL.

Health Insurance

Your loved one’s policy through an employer or private health insurance typically cover only the same kinds of limited services as Medicare. If they do cover senior care, it is typically only for skilled, short-term, medically necessary care.

Q.  WHAT TIPS DO YOU HAVE ON HOW TO PAY FOR SENIOR CARE?

A.  THERE ARE A NUMBER OF OPTIONS TO HELP YOU OFFSET THE COST OF SENIOR CARE INCLUDING:

Veterans Aid & Attendance Benefit

Wartime veterans or a surviving spouse may be eligible to receive a non-service connected pension (above the basic pension) to assist in paying for independent living, assisted living, home health care, adult day care or skilled nursing if you meet certain conditions.

Long-Term Care (LTC) Insurance

LTC insurance can help pay for the cost of home care, adult day care, assisted living, memory care, skilled nursing and hospice by covering services typically not covered by health insurance, Medicare or Medicaid.

Life Insurance Conversion

Your loved one’s in-force life insurance policy may be able to convert into a pre-funded financial account that disburses a monthly benefit to help pay for needs such as home care, assisted living, skilled nursing and hospice.

Reverse Mortgage – This is a type of home equity loan for homeowners 62 or older who want to access their equity to supplement retirement income. In this case, the lender makes payments to you based on a percentage of your accumulated equity.

You can also go to benefitscheckup.org through the National Council on Aging to easily check thousands of state and local programs.