As the number of retirees in this country increases, more people are needing long-term care services. The costs of care in assisted living facilities and nursing homes has skyrocketed in recent years. And it doesn’t help that a lot of people still think that Medicare can pay for LTC. If you or your parent are nearing the age of retirement, it’s important to plan for the likely eventuality of needing long-term care services. This article discusses your options for paying for long-term care in Illinois.
Cost of Nursing Home Care in Illinois
Recent statistics suggest that Illinois is the 31st most expensive state for long-term care insurance in the country, below Ohio at position 30 and above Wyoming at position 32. Across the country, the average cost of paying for a semi-private nursing home room was $222/day (for a private room, the average national cost was $248).
In Chicago, the cost of a semi-private nursing center room can be as low as $99, to as high as $320. Computed annually, that spreads to between $36,135 to $116,800 each year. In 2012, the cost for a semi-private room was $183 in Chicago, $208 in Des Plaines Area, $173 in Peoria, and averaged at $152 across the state. The cost of a private room, on the other hand, was $206 in Chicago, $271 in Des Plaines Area, and $228 in Peoria.
Obviously, the cost of nursing home care is more than most states people in Chicago can afford, especially given that you might end up needing long term care for a number of years on end.
Medicare in Illinois
To qualify for Medicare in the State of Illinois, the following requirements are applicable:
- The recipient should have been hospitalized for a minimum of 3 days.
- The recipient must go to a nursing home that’s Medicare approved less than 30 days after leaving the medical facility (hospital).
- The need for nursing home care must be the same reason the applicant was hospitalized.
- The recipient must need what’s referred to by Medicare as ‘skilled care’.
Medicare will pay for up to 100 days of ‘skilled care’ each year. According to Medicare, ‘skilled care’ describes:
- Being on oxygen
- Having a feeding or IV tube
- Needing daily injections, daily care for wounds, and other forms of skilled care
- Needs daily occupational, physical or speech therapy
- Medical condition that’s so unstable that monitoring by a registered nurse is needed
Medicaid in Illinois
If you’re thinking about Medicaid as your first line of defense in paying for nursing home care in Illinois, keep in mind that there are strict rules for eligibility in this state. In addition to qualifying financially, you will also need to medically qualify so that Medicaid can pay for care services in a nursing home, home health care, or in an assisted living facility.
Illinois citizens who are 6 years (or older), blind, or disabled may apply for Medical Assistance (Medicaid in Illinois) via the AABD (Aid to the Aged, Blind, and Disabled) program ONLY if they meet asset and income limits. The income limits will vary depending on whether you’re receiving care at a nursing home, assisted living facility, or in the community. Qualified individuals living in the community can be covered for up to 100% of the FPL (Federal Poverty Level). Back in 2014, the FPL figure was $973 per month for a one-person household and $1,311 per month for a two-person household.
People living in a nursing home can receive medical assistance even if their income is above the FPL, but then they’ll be required to contribute nearly all their monthly income to fund the care costs. In fact, AABD recipients who’re staying in nursing facilities are allowed to keep just $30 for themselves. There are no provisions for the community spouse (the spouse who’s not staying at the nursing home) to keep more income.
To qualify for Medical Assistance in the state of Illinois, the sum total of your resources (assets and properties) must not exceed $2,000. With your spouse included, this limit goes up to $3,000. Your home is not counted as a resource when evaluating eligibility for Medicaid in Illinois. Similarly, one car is exempted, and personal belongings (household goods).
Private Pay
If you’re wealthy enough, you might be able to pay for long-term care out-of-pocket should the need arise. But you need to be worth at least $2 million to have this assurance. Keep in mind that costs of long-term care are inflating at an alarming rate each year. It’s also plausible that you should factor in the possibility of your spouse or any other close dependent needing care. If your portfolio is large enough to guarantee this kind of financial confidence, then you can privately pay for nursing home care. Otherwise, you might need to look at long-term care insurance.
Long Term Care Insurance
Private long-term care insurance is often the way out for people who aren’t wealthy enough to privately pay, and who want to avoid the shortfalls of Medicare and Medicaid. Since long-term care insurance packages vary extensively, it’s important to evaluate and judge individual policies based on their own merits. You can request your preferred insurance company to provide a written description of their LTC policy’s benefits or call an agent for a break-down of the policy. The younger the applicant, the lower the premiums required to pay for long-term care insurance. Different policies also have riders that you’ll want to know about before you seal the deal. Concerned by the soaring costs of long-term care insurance at nursing homes, assisted living centers and home health care, more Americans are purchasing this form of insurance for their aging parents.
Conclusion
With Medicare’s limited benefits and Medicaid’s requirement that you’re virtually broke in order to receive help, a lot of people who can’t pay out-of-pocket are looking to insurance. Long term care insurance policies help eradicate the risk of paying for long term care, which can easily deplete your net worth. For people who are concerned about paying for this kind of insurance and never using it, some newer form of long term care insurance policies referred to as hybrid policies have a provision of converting your premiums into a death benefit for your dependents (if you don’t use long term care).