Before his two strokes my grandfather and I to used hop in the car and head out for a tasty cheap meal. Our favorite spot was Jaspers. The pancakes were fluffy and the eggs a little runny, exactly what a hungry grandfather and grandson needed.
I cherished these times. My grandfather was a mix of Frank Sinatra and Jerry Lewis. As people stopped by our table to drop off food or say hello they were soon laughing at my Grandfather’s antics and Midwestern charm. He had that special something.
During his first stroke he recovered nearly all of his motor function. He had been a smoker for years but we were thrilled with the minimal long-term effects. After the second stroke we weren’t so lucky.
He was severely debilitated. He used a walker to get to the kitchen. Loved ones helped him dress in the morning. Within months he partnered with a nurse or family member to eat food.
But we were all overjoyed that his wit and humor remained intact. Like the waitress in Jaspers we often smiled and laughed when around him. I sat in the arm chair next to him still riveted by stories of him flying planes before the big war.
Then dementia began to set in. It was devastating for many members of the family. We were losing him.
With new intensity we tried to make him feel as comfortable as possible. The logistics however were overwhelming. He needed 24/7 care and help with nearly everything from dressing to eating, from moving to taking his medication, and on and on. We lost him several years ago. I miss him a great deal.
If you are also caring for a loved one I know you face many of the same struggles. Sometimes the days feel like they’re 36 hours long, you always feel like you’re running from one place to the next and rarely do you have a moment to catch your breath.
Stick with me. I will show you the exact steps to set up the best care for your loved one. Over the next two posts I will walk through searching for, finding and setting up your loved one in a nursing home.
Each component will be broken down. You’ll feel like you have control once again and you’ll know exactly where to go to find the best resources.
The stress will be lightened and you’ll have more free time to rest. Knowing what to do can be more than half the battle.
Myth: Nursing Homes Are Too Expensive (And The Truth Behind The Lie)
“Everything should be made as simple as possible, but not simpler”
– Albert Einstein
The entire Missouri and Mississippi river system has 375 species of fresh water fish.
Guess how many the Amazon has?
Over 3,000. 8X more than North America’s great rivers.
Sometimes nursing home costs can feel more like the Amazon than the Mississippi. The costs vary greatly by state. Different types of services can have dramatically different rates. Some facilities appear to be covered by the Government and yet others only accept private pay.
The myth is that nursing home costs are just too complex. That you can’t understand them. That there’s no way to get out from under the crushing cost burden.
That just isn’t true. Sure there’s some tough medicine. But let’s look at the details and consider real options. I want to enable you with the appropriate facts. I want to empower you with tools to make the best decision for you and your family.
Nursing home prices range from $150 to $250 a day ($50,000 to $100,000 a year). Below are the ranges for three cities.
|State||Private Room||Semi-Private Room|
Take a step now and click here for information in your state. Write down the costs for the state in which your loved one lives and any state where he or she might move (e.g., to be closer to family). Great! Now you know your target.
Often freezing in the face of emotional issues prevents people from getting to the facts. Not you! You have some key facts already. You know the ballpark figure of a year’s stay in a nursing home for a loved one. Well done!
Now let’s walk through your exact options. You will know how to pay for nursing home costs by the end of it.
How To Pay For Nursing Home Costs
“To a man with a hammer, every problem is a nail”
– Maslow’s Hammer
Lever #1: Pay With Public Funds
Public funds for the elderly come in three large buckets:
- Veterans benefits.
Medicare (“The Emergency Care Lever”)
Do not discount Medicare. Many loved ones on the way to a nursing home have a fall or a major medical life event that requires them to get support from a hospital. View Medicare as the aid during this initial phase of the process. Medicare will pick up the bill or a large portion of it. Tests and medication will be highly subsidized.
After your loved one has received care for their trauma, Medicare will pay for 100 days of rehabilitation related services. After that point Medicare coverage stops. Activities of daily living (dressing and eating, for example) are not covered during this 100 day window. It looks like we have a good solution for the beginning of the journey. Let’s keep moving.
Medicaid (“The ‘Spend Down’ Lever”)
Medicaid is the government healthcare program for the poor. You must have less than $2,000 in savings and a limited income (varies by state, but usually $600 to $800 a month) to access the program.
Medicaid differs from Medicare in that it does cover nursing home costs.
Here’s a financial secret. Many Americans will end up using Medicaid sponsored nursing home coverage because they have to. They will simply run out of money.
You and your family should consider this option.
I know it’s very controversial. However I want to enable you to make an informed decision that is best for your family. What other people think doesn’t matter.
Write down the top 5 potential ways you / your family can cover your loved ones nursing home costs. Your options will likely look like this:
- Spend Mom’s retirement money
- Stop contributing to our 401k
- Stop contributing to our kid’s college fund
- Sell a vacation home
- Sell a business
Again, this is a fiery topic, but consider accessing Medicaid for your loved one (by having them spend down their assets) before tapping into your own financial means.
One great way to understand if Medicaid sponsored nursing homes are an option for your family is to visit them. You can do it! And I will show you each and every step. You’ll understand how to locate, evaluate and review specific nursing homes in your area (more to come on this later).
Veterans Benefits (“Our Soldier’s Lever”)
Veterans benefits for long-term care are limited but absolutely a lever you should consider if your loved one served. I will dedicate additional posts to this topic in the future. Check out the VA website regarding geriatric services to get yourself started. Click here now!
Lever 2: Pay With Private Funds
“My favorite things in life don’t cost any money. It’s really clear that the most precious resource we all have is time.”
– Steve Jobs
My other Grandfather was tall, strong and disciplined. He was a nuclear engineer and wrote your drink orders on a pad of paper when you stopped by for Christmas.
One weekend he and I cooked bread. It was a recipe he had learned from his own father. I remember writing the directions down on yellow legal paper.
Soon the warm scent of cooked cinnamon and baked raisins rose from the oven. We pulled out our masterpieces and ate the first warm pieces at the circular kitchen table.
As I look back on that time it was probably the longest continuous period I spent with my Grandfather alone. We spent an entire day together. We were two men with a task. By the end we had met our goal, and grown closer while doing it.
I’ll never forget it.
Protecting those precious moments is important. A several year stay at a nursing home can ensure special memories live on and new memories can be created.
That is why it’s so important to gather all of your resources available to enable your loved one to have a fulfilling and enriching end of life process.
After considering public funds there are 4 primary private levers.
1. Use Savings
This can be an extremely powerful tool. If your loved one adequately prepared for retirement use the funds. Two must have resources are:
- Financial Planner – To address tax issues of how to best liquidate retirement funds. Secret hint – go with a “fiduciary” (they are legally obligated to be your advocate).
- Elder Care Lawyer – You need to begin to speak with an expert in eldercare law to plan for the years ahead.
Bonus! Another person you should consider having conduct an evaluation is a Geriatric Care Professional. They can do a physical exam of your loved one to determine the level of care that they need as well as connect you with a host of resources.
You may also be considering using your own savings to pay for nursing home care services. Write down the number you think you may have available. Don’t take any action yet. Let’s look at the other options first. We can always come back.
2. Pool Assets
You and your family can pool assets / savings together. This can be a great source from which to cover a portion or all of nursing home care costs.
I know this can feel uncomfortable. Many people would rather jump off a bridge than discuss money with family members. However you can do it.
First, you are not alone. Because of the size and unexpected nature of many nursing home stays, family units often pool cash together to help cover the costs.
Think broadly. Siblings, aunts and uncles, close family friends can all get involved. Maybe your loved one can contribute $20,000 a year from her savings, you pitch in $10,000 and a successful family friend can cover $25,000.
The secret is to accept that funds may come from a series of different resources.
3. Sell Assets
The largest asset many Americans have is a home. If your loved one has serious health issues they may not be able to return to their home even if they want to. Many families consider selling a home to free up a large chunk of cash.
You or another person in your family can also consider selling a vacation home or second property. This can often free up enough cash to pay for several years of a nursing home stay.
Speak with your loved one. Speak with a Geriatric Care Professional. Understand the next few years of financial needs. Selling a home is a big deal. You want to make sure everyone is on board that this is the right decision to make.
4. Leverage Private Insurance
Private insurance like long-term care is fantastic. It can be a lifesaver to cover a large portion of end of life care. However only 10% of the elderly have it. Regrettably you cannot purchase it after a major medical crisis or past a certain age. It’s an insurance that you need to have thought of purchasing years in advance of actually needing it.
Take this opportunity to maximize the long-term stability of your family’s financial future. Consider purchasing long-term care insurance for yourself and/or your spouse now. It could be a life saver down the road.
Speaking With Family (Getting Beyond The Fear And Arriving At The Solution)
The first time I spoke with someone I was dating about money we were both sitting on my bed in my apartment. We stared at each other.
I mumbled, “I know we have been going out lately…”, I said.
“And I wanted to speak a bit about money.”
I had no idea what I was doing. I made more than my girlfriend at the time. I wanted to speak to her about how we split expenses. But I was a mess.
To say the least, the conversation did not go well. Today it’s much better. My girlfriend and I speak openly about money. It isn’t always easy. But at least we’re on the same page.
But there’s one key step I took that day sitting on my bed. It’s a step I’m proud of. It’s a step you should take too. I spoke up.
You are an ambitious smart person. You’re reading this article to learn about what you can do to help a loved one. Well done! Now take the next step and speak with your family about nursing home costs.
While it may feel overwhelming there are common principles that you can use.
|Be Transparent||Start the conversationBring information with basic costsDiscuss the levers available|
|Over Communicate||Use multiple conversationsSpeak with people 1 on 1 and in groupsBuild relationships|
|Open Up Decision Making||Allow family members to have a saySplit up the work among family membersAsk people their opinion|
|Say Thank You||Show them you appreciate what they are doingShare your common frustrationsGive and receive hugs|
To Be Continued…
We’re just getting started. Great job on making it this far! You now know the basics about nursing homes and how you can begin to think about paying for it. These are large steps.
In my next post we’ll get into the weeds and walk through the exact steps you need to conduct an effective search. I’ll show you which sources to use (and which to avoid), how to effectively interview nursing home directors and what small red flags to look out for when you visit.
What actions can you take this week to help your loved one get into a nursing home? Write 3 below in the comments.
Click here for the next post!
January 8, 2015
By: JP Adams