SENIORS: What does Medicare pay for?

By Mary Ross McQuage  |  At least once a week as I am providing guidance and referrals to families making plans for their elderly loved ones, I have to break the news that Medicare is not going to pay for their long-term care needs, either in a nursing home or at home. Many people assume that Medicare is going to cover all of their needs as they age. The typical response to finding out this is not true is, “Well, what exactly DOES Medicare pay for?”

The following is a short breakdown of what is covered by Medicare:

• Medicare Part A (hospital insurance) – inpatient care in a hospital, inpatient rehabilitation, hospice, lab tests, surgery, home health care.
• Medicare Part B (medical insurance) – physicians and other health care providers’ services, outpatient care, some equipment, home health care, preventive services.
• Medicare Part D – prescription coverage will depend on which prescription drug plan you choose

Perhaps more importantly, here are some of the commonly needed services that Medicare DOES NOT cover:

• Long-term care – also called “custodial” care or non-medical home care
• Most dental care
• Eye examinations related to prescribing glasses
• Dentures
• Hearing aids

The most costly of these non-covered items is long-term care. Average costs for care in South Carolina are $19 per hour for non-medical home care, $3,200 per month for assisted living, and $6,000 per month for nursing home care.

So how are these needs going to be paid for? Saving and planning ahead are essential to cover these expenses. When should you start saving and planning for your long term care needs? No matter your age, the answer is now.

Barbara Franklin of Franklin and Associates works in long term care planning and financing.

“The average age of people applying for long term care insurance today is 57 but the younger you are when you apply, the lower the cost and the more likely that your health will enable you to qualify,” she said. “Fortunately there are a range of insurance options available today including traditional long term care policies, short term care policies as well as hybrids that combine life insurance or an annuity with long term care.”

Medicare is a health insurance that is designed to cover medical care. It is not designed to cover all of the extensive needs of long term care. Understand the limitations of Medicare coverage now so that you are not caught off guard with unexpected care expenses down the road.