More than 90 percent of older adults say they want to remain living at home as they age, and research shows that meeting a seniors desire to age in place has several benefits. However, most seniors will eventually lose the ability to carry out activities of daily living on their own. While home care services can provide the care needed for your loved one to remain living safely at home, you might be concerned about the cost and wonder how your family will pay for services. Below are some of the most popular payment options for home care services.
Home Care Costs
The cost of home care varies depending on where you live with rates typically higher in urban areas than in rural communities. Because rates are generally charged by the hour, there is some flexibility when it comes to expense. Home care costs in California typically range from $35 – $55 per hour, and there is usually a discounted rate for 24-hour live-in care. For seniors who require assistance only on a part-time basis, the cost of home care can be considerably lower than other long-term care options.
Using Insurance to Pay for Home Care
Long-term Care Insurance
If your loved one has long-term care insurance, it will likely cover the cost of home care. However, long-term care insurance benefits are different depending on the plan, so you may need to review the policy to make sure it allows for non-medical services. It’s also important to note that early planning is key when it comes to long-term care insurance. Seniors over age 80 with chronic health conditions may not qualify for coverage.
It may be possible to convert your loved one’s life insurance policy into a long-term care benefit plan, which will provide funds to cover the cost of home care. You might also be able to pay for home care using a life insurance policy by taking a loan from the policy’s cash value or surrendering the policy in exchange for the cash value. Contact your loved one’s insurance provider to learn what options are available.
Using Personal Assets to Pay for Home Care
Savings & Retirement Accounts
If your loved one has an individual retirement account (IRA), the funds can be used to help pay for home care. Many families pay for home care services using a combination of social security, individual retirement accounts, and personal savings. While using savings to pay for home care may not seem ideal, it is often the easiest and quickest way to receive care and keep your loved at home.
If your loved one does not have a retirement account or personal savings but does have equity in their home a reverse mortgage can be used to help pay for home care services. Seniors can generally borrow up to 70% of their home’s value and the loan does not have to be paid back until they sell the home, move out of the home, or pass away.
Using Public Benefits to Pay for Home Care
The Veterans Administration (VA) provides eligible veterans with health benefits that can be used for in-home care services in place of nursing home care, and as a way to get respite care for family caregivers. Read more about home care benefits for veterans and the eligibility requirements.
In-Home Supportive Services (IHHS)
The California IHSS Program provides non-medical care to elderly or disabled individuals who live at home. The program was designed to prevent the unnecessary placement of individuals in Medicaid (Medi-Cal) funded nursing homes. Program participants receive a set amount of money monthly to pay for care and are free to choose their own service provider. Learn more about the IHHS program.
For more information about support programs in your county that may help cover the cost of senior care visit the California Department of Aging.