Paying For Care

Medicare

Medicare is a federal health insurance program for people over 65 and certain disabled people under 65. It is not a long-term care program. Rather, Medicare covers only those nursing facility services rendered to help a beneficiary recover from an acute illness or injury. Medicare is administered by the federal government's Center for Medicare and Medicaid and is divided into two parts: Hospital Insurance (Part A) and Medical Insurance (Part B). Payments are made to providers through private insurance companies with which the government contracts or through HMOs that have risk contracts with Medicare. Eligibility--Nursing facility coverage falls under "Part A" of Medicare and is very limited. Medicare pays up to a total of 100 days of care in a skilled nursing facility (SNF). Medicare will cover 100 percent of the first 20 days in an SNF; for days 21-100, the individual must make a daily coinsurance payment.

Medicare pays for nursing facility care only under the following conditions:

1. The nursing facility is a skilled nursing facility (SNF). SNFs provide 24-hour nursing care to convalescent patients.
2. Continuous skilled nursing care or skilled rehabilitation services (as defined by the federal government) are required on a daily basis.
3. The patient has spent at least three consecutive days in a hospital and if the admission to the SNF occurs within 30 days after discharge from the hospital.
4. A physician certifies that SNF services are needed for the same or related illness for which the person was hospitalized.

Benefits - If all of the above conditions are met, Medicare pays for the cost of care during the first 20 days of care in an SNF. For the 21st through the 100th days, the patient must share the cost of care by paying a daily coinsurance rate, or a Medicare supplement can pay it. For 2008, the coinsurance amount is $128.00 (this changes annually).

Covered services under Medicare include:

• A semi-private room;
• Meals, including special diets;
• Regular nursing services;
• Rehabilitation services;
• All Drugs
• Medical supplies;

Medicare does not cover:

• Personal convenience items; i.e. telephones, beauty/barber shops, etc.
• Private duty nurses;
• Extra charges for a private room.

Medicare Part B may help pay for covered services you receive from your doctor in a SNF, if you choose to participate in the Part B medical insurance program. If you have used up your Part A coverage for a spell of illness, Part B also covers a portion of services received in a SNF, such as physical and occupational therapy. Under the Part B program, you must pay an annual premium and a deductible for all Part B services including physician services, after which Medicare pays 80 percent of the reasonable charges for covered services.

Some services that are not included under Part B are:

• Routine physical examinations and tests;
• Routine foot care;
• Eye or hearing exams for prescribing or fitting eyeglasses or hearing aids;
• Immunizations, except flu and pneumonia.

How to Apply for Medicare - Contact your nearest Social Security office to find out if you are automatically covered for Part A because of credits for the number of quarters worked in your lifetime. Also, if you are interested in signing up for Medicare medical insurance (Part B), the Social Security office can assist you with that process as well. Keep in mind, though, that you can only sign up for the insurance in the first three months of the calendar year.

Private Insurance

Because many Americans fail to plan for their long-term care needs, tens of thousands of Americans are impoverished each year by the costs of long-term care. Recently enacted health insurance legislation has helped make private long-term care insurance a more viable option for paying for long-term care costs while preserving personal savings.

The Health Insurance Reform Act includes consumer protections for purchasers of long-term care insurance and tax clarifications for long-term care insurance which make treatment of private long-term care insurance identical to that of health insurance coverage. Starting January 1, 1997, individuals have been able to include out-of-pocket expenses for long-term care and long-term care insurance premiums with their other itemized medical expenses on their annual tax returns. Long-term care and other medical expenses are deductible, provided that they exceed the federal government's 7.5 percent threshold of adjusted gross income. Also, the insurance benefits consumers receive, for the most part, will not be taxable as income.

Private Pay

Private Pay for all or part of the resident's care may be the only option during their entire stay, A resident may become eligible for the Texas Medicaid Program if their asset level diminishes. (A resident may begin paying privately for care and make an application for the State of Texas Medicaid Program)