Long-Term Care: What It Is and Who Pays

The story: Grace learns who pays

Grace talks with a nurse about rehab after a hospital stay, and learns the difference between short skilled care Medicare may cover and long-term daily help it mostly does not.

1. Narrator: Grace spent a few nights in the hospital after a fall. Now Grace needs rehab, then maybe help at home.
2. Adult: First question: were you admitted, or kept under observation? It can change whether Medicare pays for rehab.
3. Grace: I didn’t know there was a difference. And after rehab, will Medicare pay for a helper at home?
4. Adult: Medicare is for getting better. It covers short skilled care, not years of help with bathing or dressing.
5. Narrator: Daily help is usually paid from savings or insurance. Medicaid may pay once savings are mostly spent. The VA helps some veterans.
6. Grace: Then I want a plan for that, before I need it.

What you’ll learn

1. What long-term care is

   Long-term care means help with bathing, dressing, eating or moving around, or supervision because of memory loss. Most of it happens at home, often given by family.

2. What Medicare covers

   Medicare covers short skilled nursing or rehab stays, and only after a qualifying inpatient hospital stay. Ask: “Am I admitted, or under observation?” Observation days may not count. The rules are on the card.

3. Who pays for daily help

   Daily help is usually paid from your savings or a long-term care policy. Medicaid can pay once savings are mostly spent, under each state’s rules. The VA helps some veterans.

4. The odds

   Many people will need some care, but how much varies widely. Some need none, some need a few months, and some need years. Planning for that range matters more than any one average. Costs are on the card.

Key words

activities of daily living

basic self-care tasks like bathing, dressing and eating

Also called: ADLs

custodial care

help with daily living, not medical care

skilled care

medical care given by licensed staff, like nurses or therapists

Common questions

How much does care cost where I live?

Costs vary a lot by state and by type of care. The fact card links to a federal planning site with cost data.

Is it too late to buy long-term care insurance?

Not always, but prices rise with age and health changes. Policies, savings and family plans are all ways to prepare. A lesson comparing them is coming.

Remember this

Medicare is for getting better, not for daily help. Plan for that difference.

Try it: Add care to your plan

1. Look up care costs where you live using the fact card’s link.
2. Write how you’d pay for a few years of care: savings, insurance, family help or a mix.
3. Try the public retirement calculator with that extra cost to see the effect.

No account: use the public Retirement Calculator (/tools/retirement-calculator).

Live facts

Numbers that change over time, with when they were last checked and where they come from.

• Long-term care costs, odds and planning tools

  Source: ACL.gov (LongTermCare.gov)(opens in a new tab)

• When Medicare covers skilled nursing care

  Source: Medicare.gov(opens in a new tab)

• Long-term care for veterans

  Source: VA.gov(opens in a new tab)