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Bob Powell: How will you pay for long-term care? Well, Medicare does pay for certain episodic longterm care services, but the vast majority of those who will need longterm care will have only a portion paid for by Medicare. Why so? There are limitations on what Medicare pays. It covers only about 10% of long-term care costs for most people. Most people who need longterm care will need to find funding elsewhere. We'll talk more about that in our next segment. One more note about paying for longterm care. The payer of last resort is Medicaid, which pays about one third of long-term care costs and covers about one in three people who use paid long-term care. To qualify for Medicaid, one must with some notable exceptions, deplete all other assets. This means that for our affluent retirees, any extended period of paid long-term care will likely need to be paid out of pocket. However, there are a few medicaid planning strategies that can be used even by wealthier individuals.

When it comes to paying for long-term care, many older adults think that Medicare will cover such expenses. Those folks are in for a big surprise.

Medicare does pay for certain episodic long-term care services, according to a recent Retirement Daily article by Kenneth Waltzer. But the vast majority of those who need long-term care will have only a portion paid by Medicare.

Why so? There are limitations on what Medicare pays. For instance, Medicare covers medical services in nursing homes, assisted living facilities or people's own homes. But not the cost of staying in any long-term care facilities or the cost of any "custodial" care, according to AARP. Read Does Medicare cover long-term care, nursing home care or care in skilled nursing facilities? and Medicare & You 2019.

What's more, you should know that most health insurance plans, including Medicare Supplement Insurance (Medigap) policies, don't pay for "custodial care" either.

More Options: Medicaid or Private Insurance

To be fair, you may be eligible for this type of care through Medicaid, which is the payer of last resort. Medicaid pays about one-third of long-term care costs and covers about one in three people who use paid long-term care. But to qualify for Medicaid one must, with some notable exceptions, deplete all other assets.

You could also choose to buy private long-term care insurance, or pay out of pocket, or use a mix funding sources. But no matter how you pay for long-term care, it's important, according to Medicare.gov, to start planning for care now to maintain your independence and to make sure you get the care you may need, in the setting you want, in the future.

Long-Term Care Resources

  • Visit longtermcare.gov to learn more about planning for long-term care.
  • Call your State Insurance Department to get information about long-term care insurance.
  • Visit Medicare.gov/contacts, or call 1-800-MEDICARE (1-800-633-4227) to get the phone number. TTY users can call 1-877-486-2048.
  • Call the National Association of Insurance Commissioners at 1-866-470-6242 to get a copy of "A Shopper's Guide to Long-Term Care Insurance."
  • Call your State Health Insurance Assistance Program (SHIP).
  • Visit the Eldercare Locator, a public service of the U.S. Administration on Aging, at eldercare.acl.gov to find help in your community.

Another resource is Retirement Daily, which provides articles and commentary to help you plan for and live in retirement. Get more information and sign up for a free trial subscription to TheStreet's Retirement Daily.

More Retirement Advice on Long-Term Care

So, if you're trying to get a handle on planning for long-term care consider a subscription to Retirement Daily, which publishes articles and commentary designed to help everyone plan for and live in retirement. Get more information and sign up for a free trial subscription to TheStreet's Retirement Daily.

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