In considering how to pay for nursing home care in Michigan, one of the first issues that comes up is if Medicare pays for nursing home care. There is a great deal of confusion about Medicare and Medicaid, probably in part due to their very similar names.
Medicare is the federally funded health insurance program primarily designed for people age 65 and older. It is national health insurance for everyone over age 65 and has been in place since the 1960's. There are some limited long term care benefits that can be available under Medicare. In general, if you are enrolled in the traditional Medicare plan, and you've had a hospital stay of at least three days, and then you are admitted into a skilled nursing facility (often for rehabilitation or skilled nursing care), Medicare may pay for awhile.
Since it is national health insurance for those over age 65, there are no income or asset qualification rules for Medicare benefits in a nursing home, unlike Medicaid. With Medicare nursing home benefits, the issue centers more on the type of care you need, not your assets or income. If the patient broke their hip and needs physical therapy or had a minor stroke and needs rehabilitation services, Medicare may pay for those services in a nursing home for a period of time. If an older person has dementia and it has been recommended that they need twenty-four hour custodial care in a nursing home or assisted living facility, Medicare does not pay for any of that care.
If you qualify, Medicare may pay for the full cost of the nursing home stay for the first 20 days and can continue to pay the cost of the nursing home stay for the next 80 days, but with a deductible that's $141.50 per day. Some Medicare supplemental insurance policies, called Medigap polices) will pay the cost of that deductible. So, in the best case scenario, Medicare may pay for up to 100 days of skilled care or rehab. services for each “spell of illness.” In order to qualify for these 100 days of coverage, however, the nursing home resident must be receiving daily “skilled care” and generally must continue to “improve.” (Note: Once the Medicare beneficiary has not received a Medicare coverage level of care for 60 consecutive days, the beneficiary may again be eligible for the 100 days of skilled nursing coverage for the next spell of illness.)
While it's never possible to predict at the outset how long Medicare will cover the rehabilitation in the nursing home, from my experience, it usually falls far short of the 100 day maximum. If the nursing home resident will not benefit from therapy or skilled care and just needs to live in a nursing home for the custodial care, Medicare will pay nothing. Even if Medicare does cover the 100 day period, what then? What happens after the 100 days of coverage have been used?
At that point, in either case you're back to one of the other alternatives: long term care insurance, paying the bills with your own assets, or qualifying for Medicaid.
If an older person is receiving skilled care or rehabilitation services in a nursing home that is being paid for by Medicare and if it is unclear if they will be able to return home, that is a good time to meet with an elder law attorney. The reason for this is that while Medicare is paying the nursing home bill, the spouse or family of the individual in the nursing home will have time to consult with the elder law attorney and consider and implement any Medicaid planning options, which may be appropriate. Many families wait to contact an elder law attorney until after Medicare benefits have ended and they have been asked to pay a $6,500 deposit to the nursing home or are being billed $220 a day. At $220 a day in Oakland County and as is common in other areas of southeast Michigan, after just one week, the nursing home bill will be $1,540.00. Then a family can be in a crisis situation and may feel rushed to obtain information and make decisions while a large nursing home bill is being racked up. By consulting with an elder law attorney earlier in the process, this stress can be avoided, better care decisions can be made, mistakes can be avoided, and more money can be saved.
Andrew Byers is an Elder Law Attorney in the Rochester Hills area and helps older people and their families make decisions about long-term care and asset protection.