When a loved one is diagnosed with dementia or Alzheimer’s disease, many families truly believe they can manage the ongoing care one way or another. Sadly, the reality is that it often becomes a full-time job that can drain even the most dedicated and loving caregiver. When this happens families may believe memory care is beyond their financial reach, but there are ways to find the funds to pay for it without breaking the bank.
The possibilities for paying for memory care
Long-term care insurance
Paying for memory care, at least in part, with long-term care insurance is one of these possibilities, but do not assume so until reviewing the policy. The cost of long-term care insurance is generally based on what the policy covers, and most cap the amount of the lifetime benefit as well as the daily benefit so it is best to review the policy with a licensed insurance agent to be sure all questions are answered clearly.
It is also important to understand that most long-term care insurance policies require that a health care provider prescribe long-term care assistance before a policy can be used and payments from the policy often are not immediate, rather the policyholder may be subject to an “elimination period” of one to three months in memory care before starting. To learn more about long-term care insurance and paying for memory care the forbes.com article, “What Is Long-Term Care Insurance?” can help.
Download our free guide: Senior Living Options: A Step by Step Guide for Making an Informed Decision.
Supplemental security income
Supplemental security income (aka SSI) is another possibility for paying for memory care for those who qualify (based on disabilities, income and resources) because it can be used to pay living expenses. SSI income varies from state to state, with some having no SSI at all, and using SSI benefits for luxuries and anything that could increase perceived “resources” may lower the benefit. Get more information at the SSI home page.
Life insurance
One little-known source for paying for memory care is life insurance. There are several possibilities with life insurance, especially with older policies that have accrued value over many years.
In general, the types of life insurance policies that may help in paying for memory care include:
- A combined life insurance and long-term care insurance policy.
- A long-term insurance rider added to an existing insurance policy.
- An accelerated death benefit within or added to an existing policy.
- A life settlement option where the insured can sell the policy for cash.
- A viatical settlement for those with a terminal illness to access cash.
Note that term life insurance does not afford these options and that whole life policies should be reviewed with a licensed life insurance agent to assess value and how to best access funds.
Veteran’s benefits
U.S. veterans have the option of paying for memory care with veterans benefits if they meet specific qualifications for the Aid and Attendance program which provides for an increase in the monthly pension paid.
According to the Veterans Administration the qualifications include:
- Requiring help with daily functions such as bathing, eating or dressing.
- Being bedridden.
- Being a patient in a nursing home.
- Having eyesight limited to a corrected 5/200 visual acuity or less in both eyes; or concentric contraction of the visual field to 5 degrees or less.
In addition, being housebound may allow for an increased monthly pension amount paid if the loved one spends the majority of time in their home because of a permanent disability.
Even more resources may be available to elderly veterans with “complex needs” through geriatric health care benefits like long-term care, home-based and community services, and nursing home and residential care.
Medicare
For many the first thought for paying for memory care is to turn to Medicare. Unfortunately, Medicare does not pay for non-medical long-term care or custodial care such as that provided in memory care. That said, Medicare may cover some of the costs of inpatient stays in hospitals and skilled nursing facilities, home health care, cognitive and diagnostic tests, and medications. In addition, many Medicare Advantage Plans (typically PPOs or HMOs) do offer long-term care options so again a thorough review of the policy is in order. For an in-depth look at Medicare check out the payingforseniorcare.com article “Medicare Benefits for Assisted Living & Long Term Care”.
Contact us for help making the right memory care choice and to schedule your tour today Download our free guide: Senior Living Options: A Step by Step Guide for Making an Informed Decision for more information about memory care.
