Medicare covers Long Term Care (LTC) only under limited circumstances, and only for a limited period of time. Medicare will reimburse the cost of a stay in an approved skilled nursing facility which immediately follows a three-day or more hospital stay.

Further, to be eligible, you must enter the skilled nursing facility within 30 days of your discharge from the hospital, and the skilled nursing facility stay must be for the same reason as the hospitalization.

Medicare only covers the first 100 days of the skilled nursing care stay, covering 100% percent of the cost of the first 20 days, and only the cost of the remaining 80 days to the extent that the cost exceeds $99.00.

Slightly augmented coverage may be provided under private “medigap” coverage during the 100 day period, but medigap coverage does not otherwise cover LTC (see “Medigap” discussion in Chapter Three and Chapter Four).

The cost of LTC, after Medicare benefits are exhausted (if eligible at all), falls to the patient. The likelihood that you will private-pay is high, considering that Medicare paid only 10.6% of skilled nursing home cost in 1994.

The patient will continue to be required to pay the cost of his or her own LTC until his or her assets are sufficiently exhausted to be eligible for Medicaid. Individuals with adequate means and who enjoy reasonably good health may insure against this potentiality by purchasing long term care insurance (see “Long Term Care” in Chapter Four).

PRIVATE PAY

Ultimately, you are responsible for the cost of your own long-term care. Medicare will cover a portion of the first 100 days after you leave the hospital, and Medicaid will cover the cost after you have depleted your personal assets.

You are liable for the interim period. Depending on your assets, you entire net worth could be lost in the process. Do you have sufficient assets to cover the cost of your long-term care?

You shouldn’t rely on the government, since it only pays for subsistence level care through Medicaid. Nor should you rely on your children.

If you are worried that you do not have sufficient assets, you should consider long-term care insurance discussed in Chapter Four. Even if you have sufficient assets for your care, you might nonetheless consider long term care insurance if you wish to preserve an estate for your children.

Certain non-economic factors may also be at play. Were your parents or grandparents in a nursing home? Does Alzheimer’s, dementia, or extreme longevity run in your family? These are questions you need to answer with the aid of your professional team.