Today we get into the different ways to help pay for private home care services. While the majority of people who receive private home care services pay out of pocket, there are some ways to reduce that cost, if not eliminate it all together (especially if you are not receiving a lot of help each week or month).
Here are the ways to (help) pay for private home care.
Veterans Aid and Attendance
We did a whole guide on the VAA, but in short, it is a benefit for widows and veterans that can give them up to $2,000 per month for home care and assisted living services.
While this is a great benefit, it has its drawbacks, namely, that it is for veterans who don’t have a lot of money and need help. The issue with this is the benefit is retroactive as it can take many months for the paperwork to be approved.
How is someone with little money supposed to pay thousands of dollars per month for care for up to a year while waiting to be reimbursed? It can be a catch-22.
Long-Term Care Insurance
Long-term care insurance is a type of insurance one can buy to pay for home care services when they need them later in life.
Long-term care insurance is paid for with a monthly fee for (generally) multiple years while one is younger and as they age and need help, the insurance payments end once you start receiving care.
It can be costly and has some positives and negatives about it, but if you want people of mind and have the disposable income to pay for it, you can purchase it from specific companies.
So this is an obvious one, which is private pay.
Ways to pay:
- Credit Cards
While this post is about how to help pay for care, most of the time at least a portion of home care is funded privately by the family. See what the costs that are associated with private home care here.
Speak with your accountant, but many families who pay for their parent’s care can write the cost of the care off as deductions on their taxes.
In a recent case, Estate of Baral, the U.S. Tax Court ruled that $50,000 a 92-year-old Queens, N.Y. woman, Lillian Baral, paid to two in-home caregivers in the last year of her life counted as qualifying medical deduction expenses. The caregivers helped the woman with bathing, dressing, trips to the doctor, taking medications and transferring her to a wheelchair. Her doctor had diagnosed her with dementia, requiring assistance and supervision 24 hours a day for medical reasons, as well as for her safety. Baral had adjusted gross income of $94,229 so she [technically her estate] was allowed a deduction of $43,273, the amount paid for medical care that exceeds $7,067 (7.5% of her AGI). Baral wasn’t handling her own finances—she had given financial power of attorney to her brother who lived in Washington, D.C.—but he was paying for her care with her savings.
So check with your accountant BEFORE you start services to make sure that everything is set in place to maximize any deductions you can use to offset the cost of care.
MA benefits are not available yet in Massachusetts but are coming.
CMS has recently stated that in-home care will be allowed as a supplemental benefit for Medicare Advantage plans in 2019.
Overwhelmingly, people wish to live in their home as long as possible. Additionally, the cost of care at a nursing home is skyrocketing, so if CMS can save money by providing reimbursement for in-home services, then it makes sense.
Not everyone needs skilled care, so in-home care with home health aides, rather than a combination of nurses, doctors, and CNAs is a less costly option. In theory, it’s a win-win.
We work with hospitals that have grants that help people going home with various diseases.
Check with your hospital and town for any grants that may help with private home care services. Usually, a hospital (if big enough) has philanthropy department can provide you with information about some of the programs they have, and if they can’t, they should point you in the right direction.
COAs and ASAPs
Another place to look is at council on aging in town or aging service access points (known as ASAPs in Massachusetts but might be known as other acronyms in your state).
These are resources that are there to help the community and guide families to the right services and benefits that they qualify for. These agencies are great places to start when looking at care for a loved one.
As companies put more value on retaining their employees the bigger they are, the more benefits they have. You may find that they have resources to help guide you (and possibly help support you) if you need help with a parent.
As aging parents become a bigger issue with their adult children, corporations are recognizing that this is going to be an issue with their employees for the next few decades. So they are trying to organize programs to help support their employees, so they don’t lose them.
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