Protecting Your Assets from Nursing Home Cost

The Rising Cost of Nursing Homes and The Impact on Seniors

· Long Term Care,Life Insurance,Retirement

Protect Your Assets from Nursing Homes in California

Average cost of Nursing Home care in Ca. $120, 450,-Private Room

Average cost of Nursing Home care in Ca. $90, 885,- semi-Private Room

Average cost of Nursing Home care Nationwide. $90, 520,-Private Room

Average cost of Nursing Home care Nationwide . $81, 030,-Semi-Private Room

A Nursing home is becoming extremely costly here in the U.S, while at the same time becoming more and more necessary. According to the Ca. Association of Health Care Facilities nearly 400, 000 Californians reside in nursing homes and that number is expected to continue to rise higher until it doubles in 2050, before we then start to see a decline.

The cost of living in a nursing home in Ca. in 2018 was a staggering $275 per day, about $91,000 dollars annually per person and this number could be higher if you live in an upscale facility with a private room, these figures are for semi-private rooms. To show you the financial burden this exposes people to the cost of a 3 bedroom home in Los Angeles, Ca, in an above average neighborhood is comparable. So if you are a homeowner or business owner, you could lose everything with one illness. It’s becoming more and more common every day. One of the problems is that not enough people realize this and take it seriously enough. They don’t see the necessity to spend money on this because it’s not going to happen to them. Now the cost of assisted living is much more reasonable, but in order to be able to stay at one of these homes you have to be able to take care of your own daily functions, like bathing, going to the restroom and moving about. If you’re in decent health, this is a more reasonable option, but still expensive, estimated at around $41,000 per year.

Look at this powerful video below from AIG. It describes how a young woman becomes ill and unable to work and the trauma that it causes her and her family.

Fortunately, there are solutions, one of them that is talked about in the video , which I will get to later in this article.

The age of people living in these types of homes is getting younger. as we begin to have more health issues at an earlier age for various reasons. We are becoming a society of unhealthy people. Now the belief that most people have these days is that nursing homes or rest homes are for the elderly. At the time of this article, roughly 15% of nursing home patients were under the age of 65. Also, we are living longer, about 33% of the residents are age 85 or older because modern medicine is prolonging our lives,

many are over the age of 95. It’s not uncommon to see people live this long. Women make up 52 percent and men the other 48. The numbers are getting larger and present a huge problem on the horizon.

The certification data on home health agencies and nursing homes used in this report are primarily for Medicare or Medicaid certified providers. The largest single payer for long-term nursing home care is Medicaid, whereas Medicare finances hospice costs and a major portion of the costs for short-stay post-acute care in skilled nursing facilities for Medicare beneficiaries for 21 days, (Federal Interagency Forum on Aging-Related Statistics, 2012; The SCAN Foundation, 2013).

People Often Lose Their Life Savings.

Now for the places that are paid for by Medicaid you must be at or below the poverty level before they will start to pay. Many times, paying for nursing homes will often bankrupt the person who winds up in this situation, wiping out their finances before they reach the level at which the state will pay. If you aren’t prepared for this expense, it could be devastating because no one really knows when they will become ill. Again, Medicare will pay for short stays in a nursing home, if you’re released from the hospital for about 21 days, but after that you must cover the expense on your own. Fortunately, the law will protect the spouse of someone in a nursing home on Medicaid in Ca. , as long as deceased passesd away after Jan. 01, 2017.

How Do You Protect Yourself from These Cost?

Let’s look at some of the different options. In the video above the young lady had purchased a life insurance policy which had what was called Living Benefits. This is an option if you purchase this while you’re still relatively young, because once you reach a certain age these benefits are no longer available. A certain percentage of the face amount can be paid while the insured is still alive. This can be used to cover some of the expense of a nursing home stay. Also there is Long Term Care (LTC) Insurance, which will cover a good portion of the cost, depending upon the time of your stay at the facility. There is even a LTC rider available on some Life Insurance policies. However, if you wait until you’re older LTC becomes expensive or not available at all. A young person, who get a Life Insurance policy with a LTC Rider can have a payment that is extremely reasonable. Yes you will probably pay the monthly premium for quite some time, but will working all your life with the possibility of losing a good portion or all of the finances due to an illness, that might possibly be worse.

There are also different legal options available such as Annuities and Trust options available, which a whole completely different article could be written. Often times this will require the services of an Attorney to make sure that they are legal. Another option is that the assets could be transferred to a spouse, but again there are legal restrictions that need to be considered before something like this is considered, as to make sure that Medicaid’s rules and regulations are followed. There are Attorneys that specialize in Medicaid and it would probably be a good idea to consult with one if you become ill and you have assets that you could lose.

In summary :

An ounce of prevention is worth a pound of cure. We work extremely hard and it’s very difficult to become successful these days. We’re not always thinking about our future and the possibility of us having an illness in our elder years, but the odds say yes. Consult a licensed insurance agent or legal advisor. They have the training and resources to come up with a plan that will help you to protect your assets. I understand that it might be difficult to ask for help and even more difficult to look at our own vulnerability in our lives, but it’s something that responsible people do.

If you have any questions please feel free to reach out to me, I’m always more than willing to help, because I understand. I will do my best to try and be of service to you and your family, always.

Willie Ware


Aware Insurance Services

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