Answers You Need To Know
Determining the best senior living option and its associated costs can seem overwhelming. At Hamlet, we’re happy to help answer some of the most frequently asked questions about financing your retirement years. If you’re looking for resources to determine a financial plan for senior living, we are here to help.
Options For Your Next Move
How much does senior living actually cost?
The cost varies greatly depending on several factors, including the type of care, level of services and amenities, and your location. According to a survey by the National Center for Assisted Living, the national median costs of care for assisted living services were $4,500 monthly and $54,000 annually in 2023. Senior apartments that do not include care are generally less expensive than assisted living.
Does Medicare cover senior living?
Many families expect Medicare or Medicare Part A to cover assisted living costs; however, that is not the case. Medicare does not cover assisted living costs outside of 100 days of skilled services or rehabilitative care for a qualified stay. Medicare Part A only covers hospital stays, short stays in a nursing home for certain illnesses and hospice care the last six months of life after a standard yearly deductible is met.
Is there financial assistance available?
We can help you determine whether financial assistance is available for you or a loved one. United States wartime veterans can qualify for the Veteran’s Aid & Attendance benefit for veterans and their surviving spouses. This monthly benefit is in addition to a veteran’s regular pension and can help cover the costs of assisted living or nursing care. It is a “pension benefit” and compensation is not dependent upon service-related injuries. While most veterans needing assistance qualify, we recommend allowing plenty of time for the application process.
If your loved one’s income is below a certain level, Medicaid may help cover some of their senior community or nursing home costs. Each state has its own set of regulations so when you start the process, make sure to request Medicaid assistance specific to Ohio.
Is senior living covered by long-term care (LTC) insurance?
Depending on the type of policy, long-term care insurance benefits can be applied to the cost of nursing homes and/or assisted living. There are increasingly flexible long-term care policies available that can meet needs ranging from adult daycare to assisted living to skilled nursing, with certain options even paying a family caregiver for in-home care. Premiums may be tax-deductible, and benefits from tax-qualified plans are non-taxable, making this option even more appealing. However, premiums can be costly and prices increase in cost with age and poor health, so experts recommend individuals begin planning between the ages of 52-64.
What are other ways to pay?
Americans’ homes are traditionally their most valuable asset. Depending on the housing market and other factors, that money may not be immediately available when the time comes to make the move to a higher level of care. Many individuals and families try to pay for senior living with profits from selling a house first. They may also consider other options, like renting or using the house to qualify for specialized loans.
A bridge loan is designed for individuals who need access to funds right away, but are waiting for a home to sell. These interest-only loans tap into a home’s equity to pay senior living expenses until the home sells and then the borrower pays off the loan with money from the sale of the house.
Often, seniors have invested in a life insurance policy but need financial support while living. Ask your life insurance company about “accelerated” or “living” benefits to cash out a policy. The company that initially issued the policy frequently repurchases it for 50 to 75 percent of its face value but different rules may apply depending on the type of policy and company rules. “Life assurance” benefits or life insurance conversion programs are other options. It allows seniors to convert their life insurance policy directly into long-term care payments.
More questions?
If you have more questions about senior living and available financial options, contact us at Hamlet at Chagrin Falls. We are happy to provide you with the information you need to make the best choice for you or your loved one.
