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Insurance Options to Cover Alzheimer's Care, Part II

- Monday, July 29, 2013

Last week's blog post covered Alzheimer's care care costs that are covered from Medicare and Long Term Care Insurance. This week's blog post will cover Alzheimer's care with other insurance options.

Medicaid

This program, whose costs are shared by federal and state governments, is the primary payer of long-term-care services for the elderly. Unlike Medicare, it provides custodial care for Alzheimer's patients. Custodial care typically is provided in Medicaid-eligible nursing homes, but many states' Medicaid programs now pay for home care and sometimes adult day care or assisted-living facilities.

The downside: You need to be virtually impoverished to qualify. Many people end up qualifying after spending their retirement savings on care. While state laws differ, generally you can't have more than $2,000 in countable assets, including investments. A spouse who lives at home can generally keep about $113,000. You're allowed to keep your home, car and assets in certain kinds of trusts. (Visit www.medicaid.gov to find eligibility requirements in your state.)

To protect more of your assets, you can buy a state-approved long-term-care policy that is "partnership" eligible. The policy would allow you to qualify for Medicaid without having to spend almost all of your money first. For example, if you buy a partnership policy that covers $200,000 of care, you would pay out of pocket until you have $200,000 left and still qualify for Medicaid.

Disability benefits

Individuals who develop Alzheimer's while they're still working may be eligible for some coverage from disability insurance, either through an employer or an individual policy. "Their cognitive impairment can quickly reach a point where they can no longer maintain gainful employment," says Beth Kallmyer, a vice-president of the Alzheimer's Association. Most policies tend to end benefits at age 65, but rules vary by policy so it's worth checking.

The benefits triggers will depend on the policy's definition of disability. Some policies will make a partial payout if a newly diagnosed worker needs to cut back to part-time and will pay more if the worker needs to leave the job.

Individuals with early-onset Alzheimer's could qualify for Social Security disability benefits if they can't work. Early-onset Alzheimer's disease is on the government's "compassionate allowance" list of conditions subject to fast-track benefits approval. When you reach full Social Security retirement age, your disability benefits will convert to retirement benefits. (For more details, go to www.socialsecurity.gov/disability.)

Other sources of help

If you have a life insurance policy, you may qualify to withdraw most of the death benefit while you're still alive if your doctor certifies that you have less than two years to live. The accelerated death benefit could help pay for care.

Some veterans may be eligible for help from the U.S. Department of Veterans Affairs. The VA may provide custodial care at home, in adult day-care centers and in VA nursing homes for veterans who pass strict eligibility tests. Disabled lower-income vets may be eligible for Aid and Attendance benefits of up to $20,448 for an individual or $24,440 for married veterans. To qualify, a veteran must have wartime service and be unable to perform personal functions, such as bathing and dressing.

For more information on Alzheimer's care, contact Spring Arbor.

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