Medicare covers certain expenses related to long-term care needs, such as skilled long-term care, home health care, and hospice care. It generally covers professional services that are deemed medically necessary by the beneficiary’s physician. However, it does not cover all instances of long-term care, such as nursing home care. Learn the details of Medicare long-term care coverage and explore some alternate funding options to keep your out-of-pocket costs down.
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The Importance of Long-Term Care For Beneficiaries
It’s estimated that 69% of today’s 65-year-olds may need some type of long-term care service during their lifetime. Considering that the average nationwide cost for a shared room in a nursing home is currently $225 per day, it’s easy to see how quickly these costs can add up.
Medicare helps to offset the cost of hospitalization, doctor’s visits, prescription drugs, and more for beneficiaries. For many retirees, Medicare provides financial protection against expensive, often unpredictable, healthcare expenses. For example, following a cancer diagnosis, the average American spends over $42,000 on medical care and drugs. Suffering from a stroke can lead to a lifetime cost of approximately $59,900, and these are just 2 of many illnesses and injuries that could strike at any time.
How Medicare Covers Skilled Long-term Care
Skilled long-term care, also known as medical care, is defined as medically necessary care that is provided by licensed health professionals such as registered nurses, occupational therapists, speech-language pathologists, or physical therapists. These services are typically provided in a skilled nursing facility (SNF) or in a patient’s home.
On the other hand, custodial care is not covered. This type of care is non-medical services that can be provided by non-licensed caregivers. Nursing homes are often considered custodial care, as well as aid to assist with everyday hygiene and comfort, such as bathing.
Skilled vs. Custodial Eligibility
In some circumstances, it can be difficult to determine whether the service provided is skilled or custodial. To be deemed skilled long-term care, the service must meet the following requirements:
- It must be provided by professional, licensed personnel
- It must be needed and provided on a daily basis
- It can only be provided in an SNF on an inpatient basis
- It must be reasonable and necessary
- It must be needed and provided for an ongoing condition that was treated during a qualifying hospital stay or for a new condition that developed in the SNF while the patient was being treated for an ongoing condition
Common Skilled Care Situations
Skilled nursing care services are often needed for serious and ongoing medical conditions. This may include:
- Wound and post-surgical care
- Monitoring of skin conditions
- Catheter care
- Tube feedings
- Injected medications
- IV therapy
- Physical, occupational, and speech therapy
- Ambulation (walking) programs
- Diabetic management
- Therapeutic activities or exercises
- Observation/assessment of changing conditions
- Change in treatment or care based on changes in condition
- Ongoing assessment of rehabilitation needs
Common Custodial Care Situations
Custodial care is typically provided to individuals who need periodic or daily assistance with activities of daily living (ADL) and other basic needs such as:
- Going to the bathroom
- Ambulatory assistance
There are a number of conditions and circumstances that may leave an individual unable to perform basic activities of daily living on their own, including:
- Chronic disabling disease
- Alzheimer’s Disease, dementia, or other cognitive declines
- Mental illness
- A major life event, such as a stroke or a severe fall
- Lack of mobility or being bedridden
Custodial care may be provided by family members, friends, or health aides and can be performed in a variety of locations, including at home, in community care centers, intermediate care facilities, or skilled nursing facilities.
Nursing homes are generally considered to provide custodial care and are not considered skilled nursing facilities. While custodial care may be personally necessary, Medicare typically does not cover the associated costs.
How Medicare Covers Other Types of Related Care
Home health care and hospice care are often associated with long-term care needs. However, Medicare has different criteria for coverage when it comes to these types of services.
Medicare Coverage For Home Health Care
Unlike long-term care, “home health care” refers to a range of skilled care services that are provided by licensed professionals in your home, generally for a limited time. When receiving this level of care, your home health staff works closely with your doctor to create a written care plan and keeps your doctor informed regarding your progress.
Medicare may cover home care for scenarios like:
- Part-time (intermittent) skilled nursing care (fewer than 8 hours a day, and 28 or fewer hours per week)
- Occupational therapy
- Physical therapy
- Speech-language pathology
- Medical social services (when you are also receiving skilled services)
- Injectable osteoporosis drugs for women
- Medical supplies, when ordered by your doctor as part of your care
- Durable medical equipment that has been ordered by a doctor
Medicare typically does not cover 24-hour home care, custodial care if it’s the only type of home care you need, or other non-medical services such as meal delivery, shopping, cleaning, and laundry.
To be eligible to receive Medicare-covered home-health services, patients typically must meet the following requirements:
- You’re under a doctor’s care and are receiving services under a care plan that is created and regularly reviewed by a doctor
- You have a doctor’s certification that you are homebound (defined as having trouble leaving your home or leaving without the help of assistance such as a wheelchair, walker, crutches, or cane)
- You need Intermittent skilled nursing care (other than drawing blood), physical therapy, continued occupational therapy, or speech-language pathology
- Your condition is likely to improve in a reasonable and generally predictable time, or you need a skilled therapist to assist with safe and effective maintenance of your condition
- The treatment is specific, safe, and effective for your condition
- The frequency, amount, and time period of the services are reasonable
- The treatments are complex or can only be safely and effectively administered by a licensed professional
Medicare typically does not provide home health benefits if:
- You need more than part-time or intermittent skilled nursing care
- You are able to leave your home for medical treatment or
- You are able to leave your home for non-medical outings
It’s important to note that attending adult day care, leaving home for medical treatment, or infrequent absences for non-medical reasons typically does not preclude an individual from receiving Medicare benefits for home health care.
Medicare Coverage For Hospice Care
Hospice care focuses on providing specialized medical care and quality-of-life services for individuals who have advanced, life-limiting illnesses. Its purpose is to allow individuals with incurable illnesses to live their remaining days as comfortably as possible. Hospice care also helps provide support for the patient’s caregivers.
To receive Medicare-covered hospice care, patients typically need to have a life expectancy of 6 months or less. They must also agree to stop medical treatment intended to cure or slow the progression of their illness, opting to accept palliative (comfort) care instead. For example, a cancer patient may enter hospice after deciding not to pursue any further treatments, such as chemotherapy.
Keep in mind that once an individual chooses hospice care, Medicare stops paying for certain expenses, including:
- Treatments designed to cure the terminal illness and/or related conditions
- Prescription drugs intended to cure the illness (this does not include drugs for pain relief or symptom control)
- Care from hospice providers that was not set up by your hospice medical team
- Room and board at a nursing home, hospice inpatient facility, or your home (Medicare may cover short-term inpatient or respite care services if a need is determined by your hospice team.)
- Hospital outpatient care (ex. emergency room visit), inpatient hospital care, or ambulance transportation – unless unrelated to your terminal illness and related conditions or arranged by your hospice team
To be eligible for Medicare-covered hospice care, patients are typically required to meet the following criteria:
- Your regular doctor and hospice doctor have certified that you are terminally ill with a life expectancy of 6 months or less
- You have accepted palliative (comfort) care instead of care intended to cure or slow your illness
- You sign a statement opting for hospice care instead of other Medicare-covered treatments for your illness and related conditions
If you live beyond 6 months, you can still receive hospice care as long as your hospice doctor, or the hospice medical director meets with you face-to-face and re-certifies that you are still terminally ill.
It’s also important to note that you can stop hospice care at any time. You may choose to do this if your illness goes into remission or your health improves. To stop hospice care, you need to sign a form that shows the date you intend for your hospice care to end. Once your hospice care ends, you can begin receiving Medicare again in the same way you did before beginning hospice. You can also return to hospice at any time, as long as you meet the eligibility requirements.
Coverage Options for Long-term Care Beyond Original Medicare
If you’re looking for additional long-term care coverage beyond what is provided by Original Medicare, such as assisted living care and nursing home care, you may consider the following options.
- Medicare Advantage: In recent years, Medicare Advantage plans have added benefits that provide increased access to certain long-term care services. While these plans do not provide coverage for assisted living, many plans offer supplemental home care services for chronically ill beneficiaries and other supplemental home services that can help beneficiaries continue to live independently.
- Medigap: A Medigap policy may help extend the coverage period for stays in skilled nursing facilities and may reduce out-of-pocket costs for services that are not fully covered by Medicare.
- Medicaid: Medicaid is a federal and state health insurance plan for low-income individuals. To be eligible, you must have a modified adjusted income that’s below the maximum threshold, which varies by state. It provides long-term care coverage, including assisted living, nursing homes, and in-home care.
- Long-term care insurance: A private long-term care insurance policy can help pay for a variety of long-term care services. Some policies only cover nursing home care, while others provide coverage for services such as assisted living, adult day care, informal home care, and medical equipment.
- VA benefits: Veterans may be able to receive residential (live-in), nursing home, assisted living, home health care, and/or adult day care services through the U.S. Department of Veterans Affairs (VA). Long-term care services provided by the VA include 24/7 medical and nursing care, physical therapy, assistance with ADLs, pain management and comfort care, and support for caregivers. Contact your VA social worker to learn more.
Putting It All Together
Medicare offers crucial coverage for specific long-term care needs, such as skilled care, home health, and hospice. However, it’s essential to understand the distinctions and limitations, as it doesn’t cover all instances, like nursing homes.
As long-term care costs rise, exploring additional coverage options beyond Original Medicare can be helpful. Consider options like Medicare Advantage, Medigap, Medicaid, long-term care insurance, and VA benefits for eligible veterans to ensure comprehensive protection in the face of evolving healthcare needs.