We all want the best senior care that we can afford once we’ve reached a certain age, but according to a 2015 survey conducted by the Associated Press-NORC Center for Public Affairs Research, there are many Americans who don’t understand how most pay for their assisted living.
The study showed that 34 percent of Americans assumed Medicare would cover ongoing nursing home care, while another 27 percent were unsure whether or not Medicare covered assisted living.
Well, we’re here to shed some light on the subject and let you know that this popular assumption is not correct. Medicare will cover a portion of assisted living cost, but a very small one.
Over the course of the average stay in an assisted living community, families can spend between $250,000 and $450,000, if not more, on their loved ones who are in need of senior care. So how much of this staggering amount is covered under Medicare? About 12 percent, on average. Medicare will only cover medical costs associated with assisted living, which is only a small piece of the pie.
“There’s a big disconnect between what resources people think they will need financially during their last years and what they actually do,” Hans Scheil said in an article written on WRAL.com.
Scheil is the founder of Cardinal Advisors and author of “The Complete Cardinal Guide to Planning for and Living in Retirement.”
This misconception of how assisted living is financed most likely stems from the fact that 37 percent of Americans surveyed believe they will need senior care in their elderly years. However, a whopping 70 percent actually do.
Many people hope to stay at home as long as possible, and a separate survey conducted by the National Conference of State Legislatures and the AARP Public Policy Institute revealed that 80 percent of people believe they will live at home until they die.
But this is simply just not the case for most people.
After advising families on assisted living and retirement for more than 40 years, Scheil perhaps put it best when discussing the dilemma many eventually find themselves in.
“While I’d like to tell you that all of my clients plan ahead, the truth is a good amount have their adult children come to me when they are already in crisis,” Scheil said. “A parent has had a medical incident and is suddenly no longer able to live at home independently.”
Don’t be uninformed and presumptive about the senior care you might need one day. Now that you know that Medicare is only going to cover a small amount of the assisted living services you might need, it’s time to start planning for the future and saving for your needs later in life.