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How to Pay for Nursing Home Care with Social Security
Ever stared at a stack of bills and wondered how on earth you’re going to cover nursing home care for a loved one? You’re not alone.
The big question is: Can Social Security help foot the bill? In short, Social Security can assist with nursing home costs, but it won’t cover everything.
It can contribute a portion of the costs, making it easier to manage the expenses.
To fully understand how Social Security benefits can be used, and explore other funding options, keep reading.
At Global One Home Care in Boston, we’ve spent years helping families navigate these choppy waters. Here’s everything you need to know.
How Does Social Security Pay for Nursing Home Care?
First, how does social security work, and how does it pay for nursing home care?
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How Social Security Benefits Work
Social Security benefits are a lifeline for many, providing monthly payments based on lifetime earnings.
These payments replace a portion of lost income due to retirement, disability, or death of a family member.
However, they are generally not enough to cover the full cost of nursing home care.
Social Security benefits can be allocated towards nursing home expenses, but additional funding will likely be necessary.
When weighing the costs, it’s also intelligent to understand the differences in cost between nursing care/assisted living vs. home care to find the most cost-effective solution.
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How Much Will Social Security Pay for Nursing Home Care?
The average Social Security retirement benefit is about $1,543 per month as of 2021.
This retirement Estimator tool developed by the SSA helps you do the math.
In comparison, the average cost of nursing home care ranges from $7,756 per month for a semi-private room to $8,821 for a private room【67†source】.
This means Social Security benefits alone won’t cover everything but can help offset some of the expenses.
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Social Security and Long-Term Care
Social Security provides a steady income that can be used in conjunction with other funding sources.
It plays a supporting role in long-term care financing, complementing other programs like Medicaid, Veterans Benefits, and long-term care insurance.
To further supplement Social Security benefits in caring for your loved, consider integrating healthy practices into their daily routine, including healthier food choices, exercise (such as effective leg exercises for seniors) that can improve overall mobility and reduce dependency on nursing home care.
Differences Between Social Security and Other Long-Term Care Funding Sources
While Social Security offers a baseline income, other programs provide more substantial coverage for nursing home costs.
Medicaid, for instance, covers most of the long-term care expenses for eligible individuals, while Veterans Benefits offer significant support for veterans and their spouses.
Long-term care insurance can also cover nursing home expenses but needs to be purchased well in advance.
How to Pay for Nursing Home Care with Social Security Disability (SSDI)
If your loved one qualifies for SSDI, these payments can help cover nursing home costs.
Steps to Utilize Social Security Disability Insurance (SSDI) for Nursing Home Costs
Start by applying for SSDI through the Social Security Administration’s website or local office. The application process involves submitting medical records, work history, and other documentation to prove eligibility.
Eligibility for SSDI depends on the applicant’s work history and the severity of their disability.
The application process is detailed but once approved, SSDI benefits can provide substantial financial support. These payments can be allocated to cover nursing home expenses, similar to Social Security retirement benefits.
How SSDI Payments Can Be Allocated to Cover Nursing Home Expenses
SSDI payments can be used to pay for nursing home costs.
However, if the recipient is in a Medicaid-approved facility, a portion of their SSDI benefits might be allocated towards their care, with a small amount set aside for personal needs.
Special Considerations and Limitations
There are nuances to using SSDI for nursing home care.
For example, if the recipient is receiving Medicaid benefits, their SSDI payments may be partially directed towards nursing home costs.
It’s important to manage these funds carefully, especially if the recipient has a Representative Payee.
How to Pay for Nursing Home Care with Social Security in Massachusetts (Boston)
Massachusetts has specific programs that can help cover nursing home costs.
The state’s Medicaid program, MassHealth, works alongside Social Security benefits to provide comprehensive coverage. Eligibility for MassHealth depends on income and asset limits, so it’s crucial to check the current guidelines.
In Massachusetts, Medicaid can cover the costs that Social Security benefits do not.
Typically, the nursing home resident’s Social Security benefits will be used to pay for a portion of their care, with Medicaid covering the remainder.
This collaboration ensures that the resident receives the necessary care without exhausting their personal resources.
But there’s an issue..
Another common myth is that Medicare, the government health insurance program for persons 65 and older, covers long-term care facility stays.
According to experts, Medicare only covers the first 100 days of treatment in a nursing home or skilled nursing facility, and only if specific requirements are met. For example, the patient must have been hospitalized for at least three days before being transferred to a nursing facility.
Medicare covers everything for the first 21 days. And then…
There is a daily copayment from days 21 to 100, which in 2024 is $204/day. When you reach day 101, Medicare coverage ceases, and alternative kinds of payment must be in place.
Do Social Security Benefits Go to Nursing Homes?
How are social security checks managed when a person is in a Nursing home?
When a person enters a nursing home, their Social Security benefits can still be used to pay for their care. In some cases, a Representative Payee—usually a family member or a legal guardian—will manage the benefits to ensure they are used appropriately.
The Representative Payee system helps individuals who cannot manage their own finances.
The Representative Payee uses the Social Security benefits to pay for the individual’s care and other needs, ensuring proper management and allocation of funds.
Social Security and Nursing Homes: Payment Process
Here’s a Look at the Payment process and how nursing homes handle social security benefits
Nursing homes typically work with the resident or their Representative Payee to manage payments.
Social Security benefits are deposited into the resident’s account, and the nursing home bills the resident for their share of the costs. Any remaining amount can be paid by Medicaid or other funding sources.
Tips for Ensuring Proper Management and Allocation of Funds
To ensure funds are managed correctly:
- Regularly review nursing home bills and statements.
- Keep detailed records of all payments and expenses.
- Communicate frequently with the nursing home’s financial office to resolve any discrepancies.
Combining Social Security with Other Funding Sources
Combining Social Security with other funding sources can help cover the high costs of nursing home care.
Medicaid is a primary source of long-term care funding, especially for those with limited income.
Veterans Benefits can also provide significant support for eligible veterans and their spouses.
Additionally, long-term care insurance policies can cover nursing home expenses, but these must be purchased well in advance of needing care.
Here’s how to strategically combine these resources with social security benefits
A strategic approach involves:
- Applying for Medicaid as soon as eligibility criteria are met.
- Exploring Veterans Benefits if applicable.
- Using long-term care insurance benefits if available.
- Allocating Social Security benefits to cover remaining costs.
What Social Security Does Not Cover
Social Security benefits are intended to replace lost income and do not cover specific medical or long-term care costs.
They can be used to pay for living expenses, including a portion of nursing home care, but they do not cover medical treatments, medications, or other healthcare services directly.
Supplemental programs like Medicaid, state-specific assistance programs, and private insurance plans can help cover what Social Security does not.
It’s essential to explore all available options to ensure comprehensive coverage.
Other Ways to Pay for Nursing Home Care
Aside from Social Security and Medicaid, other options include:
- Long-Term Care Insurance: Policies designed to cover long-term care expenses.
- Personal Savings and Assets: Using retirement savings, home equity, or other assets.
- Reverse Mortgages: Allowing homeowners to access home equity for care costs.
- State Assistance Programs: Many states offer programs to assist with long-term care costs for low-income residents.
- Veterans Benefits: For eligible veterans and their spouses, offering substantial support for long-term care.
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Nursing Home vs. Home Care: Comparing Costs and Benefits
It’s never easy to decide on what would be the best way to care for our aging loved ones. But, choosing between nursing care and home care involves weighing costs, quality of care, and personal preferences.
Let’s break down the details to help you make an informed decision.
- Cost Comparison: Nursing Home Care vs. Home Care
Nursing home care is significantly more expensive than home care.
According to Genworth Financial’s 2023 Cost of Care report, the typical annual cost of skilled nursing in a private room in a nursing home is $116,800, compared to little more than $104,000 for a semi-private.
However, fees might vary greatly depending on the location and which services a senior need.
For example, Genworth says that private nursing homes in Alaska, Connecticut, and Hawaii cost $1,137, $545, and $401 per day, respectively. In Alaska, that amounts to a stunning $415,005 every year.
In contrast, home care costs vary widely but generally range from $20 to $30 per hour, making it more affordable, especially if only part-time care is needed.
- Quality of Care: Nursing Home vs. Home Care
Nursing homes provide structured environments with 24/7 medical care, which is ideal for individuals with severe health issues.
However, home care offers personalized, one-on-one attention in a familiar environment, which can lead to better emotional and psychological outcomes.
Families often find that home care provides a higher quality of life for their loved ones. But don’t take our word for it, you can talk to families who’ve been able to find a good caregiver for their loved ones.
- Emotional and Psychological Impact
Staying at home often has significant emotional and psychological benefits.
Familiar surroundings, personal routines, and the comfort of home can improve overall well-being.
Studies have shown that seniors receiving home care experience less depression and anxiety compared to those in nursing homes.
Why Consider Home Care Instead?
If you’re still contemplating with your family about what option might be the best care for them, we strongly recommend you consider home care. Most seniors if not all, prefer to age at home.
Do not let costs be the barrier; you can find very affordable caregivers for your loved ones, and that’s we do here at Global One Home Care. Feel free to contact us today to find the right caregiver for your loved one.
Here’s why you should consider home care instead…
- Flexibility and Comfort
Home care offers unparalleled flexibility. Care plans can be tailored to meet the specific needs and preferences of your loved one.
Staying in a familiar home environment can significantly improve their quality of life.
- Cost-Effectiveness
Home care can be more affordable than nursing home care.
By using Social Security benefits alongside other funding sources, families can often cover the costs without depleting their savings.
This financial flexibility allows for better resource management and long-term planning.
- Enhanced Quality of Life
Personal stories and testimonials consistently highlight the improved quality of life that home care provides.
Seniors enjoy more independence, personalized attention, and a better emotional state when they can stay in their own homes.
The psychological benefits for both the elderly and their families are profound
Wrapping up
Money is tight, and paying for nursing home care with Social Security is no easy feat.
While Social Security can help, it’s not the whole answer. You need a mix of benefits, smart planning, and sometimes a bit of creativity to make it all work.
From SSDI to Medicaid, and even considering home care as a viable, often better alternative, the solutions are there—you just have to know where to look.
At Global One Home Care, we believe in empowering families with the right information so you can make the best choices for your loved ones.
Don’t just settle for what’s out there; make informed, compassionate decisions that enhance the quality of life for your elderly parent.
FAQ
Still have more questions we’ve not answered? Checkout our frequently asked questions;
- What happens if I don’t have enough Social Security to pay for a nursing home in Boston?
If Social Security doesn’t cover all the costs, look into Medicaid, which can assist with nursing home expenses if you meet the eligibility criteria.
Additionally, consider other options like Veterans Benefits, long-term care insurance, and even reverse mortgages to cover the gap.
- What happens to elderly who have no money?
Elderly individuals with no financial resources may qualify for Medicaid, which covers nursing home care for those with low income and limited assets.
Social services and community programs can also provide assistance, ensuring they receive the necessary care and support.
- How to pay for a nursing home in Boston?
Paying for a nursing home in Boston involves a combination of Social Security benefits, Medicaid, long-term care insurance, and personal savings.
Massachusetts’ MassHealth program can also provide additional support for eligible individuals.
- Who pays for nursing home care in the US?
Nursing home care in the US is typically paid for through a combination of personal funds, long-term care insurance, Medicaid, and, to a lesser extent, Medicare for short-term stays.
Social Security benefits can contribute but rarely cover the full cost.
- What happens if an elderly person has no one to care for them?
If an elderly person has no family or friends to care for them, adult protective services, social workers, and community programs can step in to ensure they receive the necessary care.
In some cases, guardianship may be established through the courts.
- What to do with aging parents who have no money?
If your aging parents have no money, explore options like applying for Medicaid, seeking Veterans Benefits if applicable, and looking into state and community programs that provide financial assistance and support services.
Home care can also be a more affordable alternative to nursing homes.
Dr. Ella Njike is the CEO and founder of Global One Home Care Boston, a Boston-based agency providing compassionate in-home support for seniors and individuals with disabilities. With a Doctorate and extensive experience working in the healthcare industry, Dr Ella brings a unique understanding to the challenges families face. He established Global One Home Care to ensure that care extends beyond daily tasks, focusing on building genuine connections and respecting each individual's journey. Dr. Njike is deeply committed to creating an environment where clients feel truly valued and at home.
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