Paying for decent home health care isn’t getting any easier. Depending on where you live, the average hourly cost for a homecare services professional can be as high as $28 per-hour, according to data from the American Association for Long-Term Care Insurance.
In addition, health care costs are rising across the board. According to a study from PriceWaterhouseCoopers, health care costs are expected to rise by 11% in 2011.
Homecare: The Preferred Care Option
The fact is, a vast majority of Americans want to receive care in the home. According to another Genworth survey conducted in early 2010, when asked to identify the setting most preferred to receive long-term care, 78% chose the home, 18% chose assisted living and only 2% selected a nursing home.
For most people, the ability to live independently is critical to maintaining quality of life. The good news is that many may be surprised to learn that paying for homecare could even be their most cost-effective choice.
"Long-term care is not just about nursing homes anymore. Care options have expanded dramatically over the past several years to include a far greater choice of settings that reflect the ways in which individuals prefer to receive care," said Buck Stinson, President, U.S. Life Insurance Products at Genworth. In fact, 73% of Genworth's initial benefit claims are for home health care.
Tips on Paying for Homecare
So how can you get the best deal on paying for homecare costs? For starters, try these tips and see if they don’t lead you down a path to good health care at a good price:
- Get some insight from a professional. Ask a specialist about the ins-and-outs paying for homecare. A good retirement planning specialist can get you on the inside track on cost containment relating to home health care costs. It might cost you several hundred dollars up front, but you’ll save way more cash on the back end.
- Examine your existing health insurance policy. There may be some provisions in your health insurance that can help defray the costs of home health care. Read your policy and then follow up with your company’s benefits specialist (or directly through your insurer) to find out what breaks you might get on paying for homecare coverage.
- Buy a better health insurance policy. If you strike out on your current insurance policy, take the bull by the horns and buy a new policy that covers homecare.
- Be tax savvy. Most health insurance policies are tax qualified, meaning that you may deduct homecare costs up to the policy’s limit. To be sure, check to see if your policy is tax qualified or not.
Find out who pays for home health care (so you don’t have to). Most health insurance companies, HMOs, PPOs and Workers’ Compensation cover home health care. In addition, Medicare and Medicaid pay for homecare services. According to government rules, the following criteria are used to meet Medicare requirements:
- The patient is a Medicare recipient.
- The patient must be homebound. This is defined by Medicare as “normal inability to leave the home and that leaving the home requires considerable and taxing effort.”
- The skilled care must be medically necessary as determined by the physician.
Cutting your homecare costs is all about planning, and all about casting as wide a net as possible for opportunities to save on homecare. Start that journey using the tips above, and you’ve got a great head start on paying for homecare.
Homecare can be a great and affordable option for seniors who do not wish to leave their homes but can no longer live independently. Browse our comprehensive directory to find homecare agencies in your area.
Written by senior finance expert Brian O’Connell.