Who Pays for LTC Services?

If you have enough income and savings, you will likely need to pay for long-term care services on your own, from your income, savings, and possibly from the equity in your home. You can also purchase long-term care insurance to cover your personal care needs.

Three main government programs might help you pay for services if you meet their rules, though these programs cover limited numbers of people.

Medicaid

Medicaid may pay for your care if you qualify based on your level of need or disability (also called “functional eligibility”) and have limited savings, or if you use up your savings paying for long-term care services yourself.

The Older Americans Act

The Older Americans Act may also help you to pay for some long-term care services.

Department of Veterans Affairs

If you are a Veteran, the U.S. Department of Veterans Affairs may provide some long-term care services.

State programs

In addition, some states offer their own programs to cover some long-term care services.

You may use a variety of payment sources, some from public programs and others from private insurance, or from your own income and savings as your care needs and financial circumstances change.

Many people think Medicare or their regular health care insurance from their employer that covers hospital stays and doctor visits will pay for long-term care. Health care insurance and Medicare may pay for your care if you need skilled care or care for a short time to recover from an illness or injury. They do not cover ongoing personal care needs, like help with bathing and dressing.

Coverage Limits of Long-Term Care Offered by Health Insurance

	Public	Private
Long-Term Care Service	Medicare	Medigap Insurance	Private Health Insurance
Overview	Limited coverage for nursing home care following a hospital stay and home health if you require a nurse or other skilled provider.	Insurance purchased to cover Medicare cost sharing.	Varies, but generally only covers services for a short time following a hospital stay, surgery or while recovering from an injury.
Nursing home care	Pays in full for days 1–20 if you are in a Skilled Nursing Facility following a recent 3-day hospital stay. If your need for skilled care continues, may pay for the difference between the total daily cost and your copayment of $137.50 per day for days 21-100. After day 100 does not pay.	May cover the $137.50 per day copayment if your nursing home stay meets all other Medicare requirements.	Varies, but limited.
Assisted living facility (and similar facility options)	Does not pay.	Does not pay.	Does not pay.
Continuing Care retirement community	Does not pay.	Does not pay.	Does not pay.
Adult day services	Not covered.	Not covered.	Not covered.
Home health and personal care	Limited to reasonable, necessary part-time or intermittent skilled nursing care and home health aide services, some therapies if a doctor orders them, and a Medicare-certified home health agency provides them. Does not pay for on-going personal care or only help with Activities of Daily Living (also called “custodial care”).	Not covered under current policies. Some policies sold prior to 2009 offered an at-home recovery benefit that pays up to $1,600 per year for short-term at-home assistance with activities of daily living (bathing, dressing, personal hygiene, etc.) for those recovering from an illness, injury, or surgery.	Varies, but limited.