When your parents reach a certain age, you have to start worrying about the medical care that they need. At some point, you may no longer be able to provide everything for your parents, especially if they develop conditions like Alzheimer’s disease that affect their cognition and independence.
Nursing homes are a crucial tool for families struggling with the care needs of older adults. If your parents have money set aside for their golden years or receive Medicare benefits, you might assume that they have coverage for nursing home care if it becomes necessary.
However, unless your parents diminish their assets enough to qualify for Medicaid or plan ahead to qualify, they may not get the benefits they need to cover those costs. Will you be able to pay for a nursing home on their behalf?
Nursing homes are incredibly expensive
A nursing home will charge a premium for the services that they provide for their residents. Many nursing homes are for-profit institutions, and it shows. The cost of nursing home care far exceeds the savings of most older adults. Those who want a private room will have to spend, on average, $102,200 every year, while a semi-private room will be slightly more affordable at $90,156 annually on average.
In other words, a few years in a nursing home may completely consume your parents’ savings and the equity in their home. In fact, the cost for nursing home care might exceed what you make in a year. Paying out-of-pocket may not be an option, which means that you need to help your parents plan ahead for the costs associated with long-term care.
Long-term care planning should start well before you need benefits
Developing a legal and financial strategy to help your parents cover the costs of nursing home care will protect their legacy and your financial equilibrium as they continue to age. Long-term care planning can involve the purchasing of special insurance policies, although if your parents are at retirement age, such policies may already be cost-prohibitive for your family.
Creating a trust and diminishing personal assets are common practices during long-term care planning. A lawyer reviewing your parents’ financial and medical circumstances will be able to guide you in making the best decisions possible to maximize protection for your aging parents.