Financing is often a key concern when an elder family member requires medical and personal care, especially when a senior has health issues. Funding elder care can be difficult. Even basic personal care services can cost tens of thousands of dollars a year. If skilled nursing care is required, annual expenses can jump to a staggering $120,000 or more per year.
Types of Elder Care Funding
There are two main types of funding for elder care: government support and private pay. Government support includes Medicare, Medicaid and veteran’s benefits.
Medicare is part of the Social Security Act and managed by the U.S. government. The program was launched in 1966 to ensure health care for seniors aged 65 and older and younger people with specific disabilities. You may also be eligible for Medicare if you have kidney failure.
In order to qualify for Medicare, you must be a U.S. citizen and have paid into the system. Medicare primarily focuses on emergency and short term care. It does not cover long term care or personal care such as assistance with hygiene and housekeeping. Skilled nursing may be provided under certain circumstances for 20 days. If longer care is needed, Medicare will cover costs that exceed $140.00 per day for the next 21 to 100 days.
Medicaid is a health care program for low income individuals of any age. The program will only cover long term care if you meet strict financial criteria. Individuals with assets rarely qualify for Medicaid.
Military veterans can receive disability benefits if the injury was service-related or the Aid and Attendance Benefit for non-disability cases who are war era veterans or their surviving spouses.
Funding Elder Care On Your Own
For many people, funding elder care will require tapping into other types of financial resources such as savings accounts and loans. However, depleting bank accounts and increasing debt can create new hardships and burdens.
One way to avoid a financial catastrophe is with a life settlement or viatical settlement.
A life settlement is the selling of a life insurance policy to a third party. The sale price is lower than the death benefit by much higher than the cash surrender value. In most cases, the policyholder must be at least 65 years old and not chronically or terminally ill.
Viatical settlements are a form life settlement structured for life insurance policyholders who have a chronic or terminal illness. In order to qualify for this type of settlement, life expectancy is generally 2 to 5 years.
In both cases, after the policy has been sold, the buyer becomes responsible for the policy’s premium payments. The buyer will also be the beneficiary of the policy when it is time for death benefits to be paid.
While there are no restrictions on how the money from a life settlement or viatical settlement is used, in most situations the income will go towards elder care. A third option involving a life insurance policy is a Long Term Benefit Plan. Similar to life settlements and viatical settlements, the policy is sold to a third party. The difference is that the money from the sale is deposited into a protected Benefit Account.
A Long Term Benefit Plan can be established fairly quickly, usually within 30 days. There are no limitations regarding what type of care the money is spent on and the money does not need to be paid back.
It can be heartbreaking to watch a family member’s physical or mental condition deteriorate as they age. It can also be devastating when financial resources for assisted living, nursing home or hospice care are limited – or nonexistent. Elder Care Funding specializes in finding financial solutions for seniors in need of medical and personal care. To find out if you qualify for a Long Term Benefit Plan, complete the form below. You can also give us a call at 1-844-814-6511.