As you reach retirement age, you may begin to worry about how you’ll manage financially if you need to pay for assistance with your daily activities, and if Medicare covers any of the costs. If you would rather not depend on others for financial assistance, you may be wondering how best to cover these costs.
If your health makes it challenging to get around or run errands, in-home care is a convenient solution that is usually less expensive than long-term residential care. It can be an effective way for you to stay home, where you want to be while getting the extra help you need.
People often ask if Medicare will pay for in-home care services. In a nutshell, Medicare will pay for certain medical services provided in the home, as long as certain criteria are met. However, non-medical in-home care usually is not covered.
What Medicare Covers
Original Medicare (Part A and Part B) generally covers inpatient and outpatient medical care. Part B will cover certain services provided in your home if you are homebound due to a disability or if you are recovering from an illness or injury. You must have a doctor’s order and plan of care, and services typically are temporary, usually following a hospitalization.
Covered services may include:
- Home health services from a Medicare-approved agency
- Services provided by medical social workers
- Physical and occupational therapy
- Speech and language therapy
- Skilled nursing care
- Hospice and palliative care
It’s important to note that these services are limited, typically to a few hours per week, and are rendered by a Medicare-certified and approved home health agency. Often, such services are arranged by a hospital social worker prior to discharge.
Some Medicare Advantage programs have expanded services to include certain in-home care services. However, these coverages tend to be very limited. The bottom line is that you should not count on Medicare to pay for the costs of in-home care. Individuals with limited resources may qualify for assistance through Home and Community-Based Services (HCBS), which were designed to help Medicaid beneficiaries to receive care in their homes.
What Medicare Doesn’t Cover
Medicare does not cover what is considered “custodial care” or “personal assistance.” This includes help with housekeeping, laundry, meal preparation, transportation, and companion care. Personal assistance may also include help with bathing, grooming, dressing, or taking medication. If you need in-home services, there are a number of options to help cover the cost:
- Long Term Care Insurance – You may have purchased a long‐term care policy long ago. If so, be sure to contact the insurance company to find out what is covered and what you need to do to receive benefits.
- Employer or Union coverage – If you are covered through an employer or union policy, ask your benefits administrator non-medical home care services are covered.
- Veterans Benefits –Veterans may qualify for a certain number of hours of personal care services in the home. Contact your local VA administrator to learn more.
- Home Equity Loans – If you own your home, you may be able to borrow against the equity. A home equity conversion mortgage can provide income for current needs and does not need to be paid until the home is sold.
- Annuities – Your financial planner can help you fund an annuity with retirement savings. These can offer a tax benefit while providing a steady income stream that pays out until death or for a set number of years.
- Life Insurance – A life insurance policy with cash value may be cashed out and used to fund an annuity or put into another instrument that can provide funds to help pay for care.
- Collective Sibling Agreement – If grown children are worried about your living alone but cannot care for you themselves, they could agree to contribute collectively to a fund set aside to pay for in-home care. You may create a formal agreement providing for the contributed funds to be reimbursed from their inheritance or the proceeds of your home after your death.
In summary, Medicare is not intended to provide you with in-home services, but with careful planning ahead and wise use of resources, it is possible to pay for services not covered by Medicare. In-home care can be a solid investment for your golden years, ensuring you can remain in your home while maintaining your dignity, mobility, and independence.