How Can My Patients Afford Senior Living?

1. For the patient who is 65 and older ... evaluate their Medicare coverage.

During open enrollment for their 2019 coverage, 71% of eligible adults did not reevaluate their Medicare coverage from the previous year. Although Medicare does not cover the cost of senior living communities, it may include inpatient hospital stays, care in a skilled nursing center, hospice care and some home health care.

Medicare is divided into four plans that cover a variety of services relevant to seniors:

  • Part A: Hospital insurance that covers inpatient hospital stays, care in a skilled nursing center, hospice care and some home health care.
  • Part B: Medical insurance that covers certain doctors’ services, outpatient care, medical supplies and preventive services.
  • Part C: Medicare Advantage Plans are offered by a private company that contracts with Medicare to provide you with Part A and Part B benefits. Most Medicare Advantage Plans offer prescription drug coverage too.
  • Part D: This plan adds prescription drug coverage to Original Medicare, some Medicare Cost Plans, some Medicare Private-Fee-for-Service Plans, and Medicare Medical Savings Account Plans.

To help educate your patient about different types of Medicare coverage, we’ve compiled a list of FAQs.

2. For the patient who may need to move to senior housing quickly ... they might consider a bridge loan.

Moving into senior living can sometimes be unexpected due to medical emergencies or a realization that living at home is no longer a safe option. Many senior financial services provide short-term loans called bridge loans that may help cover senior living costs while your patient waits for the sale of their home or other benefits to kick in.

Bridge loans may make it possible to transition to senior living quickly. Typically, the condition of these loans state that the loan must be repaid once funds are available. Brookdale has a relationship with multiple financial institutions who may be able to assist potential residents with loans of this type to help make the transition to senior living.

Potential Benefits of Bridge Loans:

  • The approval process is usually quick.
  • Funds typically process within 24 hours and can be wired directly to a senior living community.
  • Many senior living providers, including Brookdale, may assist with coverage of interest on the bridge loan.
  • Most lenders allow up to six applicants to split the loan, making it a good option for families.

3. For the patient who needs flexibility ... they might consider converting a life insurance policy.

Your patient may be able to convert an existing universal, whole, term or group life insurance policy to a pre-funded account to help pay for long-term care. This is a flexible option when it comes to financing senior living. Typically, many health conditions are accepted; your patient doesn’t necessarily need to have a terminal illness to qualify.

The benefit may also be adjustable, so monthly payments could be altered to meet your patient’s changing healthcare needs.

Potential Benefits of a Life Insurance Policy Conversion:

Typically, life insurance policy conversions offer

  • no waiting periods
  • no premium payments
  • no care limits
  • no costs to apply

4. For the patient with a spouse or partner at home ... they might consider reversing their mortgage.

If it’s time for your patient to make the move but not their spouse or partner, it can cause a lot of financial strain. A home equity conversion mortgage — also known as a reverse mortgage — may allow for your patient’s health needs to be met in assisted living while their partner can remain at home.

Here’s how it works: A reverse mortgage allows your patient to tap into a tax-free cash flow that can be used for expenses such as assisted living or long-term care insurance while maintaining ownership of their home. Securing a reverse mortgage is a big decision, so it’s important your patient talks to a financial advisor or attorney to weigh the pros and cons of a reverse mortgage. The U.S. Department of Housing and Urban Development (HUD) provides counseling services to help your patient and their partner find a reputable lender.

Reverse mortgages aren’t the best choice for everyone, as they can take some time to set up; but they may generate cash flow for a better quality of life without needing to sell a home.

Potential Benefits of Reverse Mortgages:

  • You own your home; the bank doesn’t.
  • There are no restrictions on how the money can be used.
  • Reverse mortgages are regulated by the U.S. Department of Housing and Urban Development (HUD).
  • Heirs of seniors are not responsible for repayment of this loan.
  • Income from a reverse mortgage is tax-free and doesn’t affect Social Security or Medicare benefits.

5. For the patient who is a veteran ... they might consider utilizing the Veterans Aid and Attendance Benefit.

Veterans and their surviving spouses may be eligible for a benefit called Veterans Aid and Attendance, which can help with a portion of assisted living and skilled nursing costs. If your patient is eligible for a Veteran’s Administration pension and requires aid from another person, they may qualify for this benefit, in addition to their monthly pension.

Your patient may qualify if they receive a VA pension and meet one of the following criteria:

  • Your patient needs outside assistance to help them perform daily activities. This includes bathing, dressing or feeding.
  • Your patient stays in bed for most of the day due to illness.
  • Your patient is in a skilled-nursing home due to the loss of mental or physical abilities from a disability.
  • Your patient’s eyesight is limited, specifically if they have 5/200 vision or worse in both eyes, or concentric contraction of the visual field to 5 degrees or less — even with glasses or contact lenses.

Long-term care can be a significant financial investment, but when the time comes, it’s a conversation worth having. At Brookdale, we’re doing all we can to make that conversation easier. If you or your patient has further questions, contact us today.

The above content is shared for educational and informational purposes only. The content is not intended to be a substitute for professional or financial advice and should not be relied upon for making financial or other decisions. Please consult your attorney or financial advisor before acting on any content in this blog.

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