Nursing homes — sometimes called skilled nursing facilities or convalescent homes — are one senior care option to explore. Nursing homes offer the highest level of care to adults who have chronic, debilitating physical or mental health conditions and require round-the-clock supervision. They provide more specialized resources than assisted living or memory care communities, typically administered by licensed professionals. These services include wound care, feeding assistance, injections, and physical therapy. In addition to meeting medical needs, nursing home staff also provide help with activities of daily living (ADLs), such as bathing and grooming, and activities to promote social interaction.

Because nursing homes provide this high level of care, they tend to cost more than other senior care types. As of January 2021, the average cost of a shared room in a nursing home was $255 a day, or $7,650 a month, according to the American Council on Aging. If your loved one’s doctor has determined they require nursing home care, you’ll want to start planning how your family will cover nursing home costs.

Paying for nursing home care through federal and state programs

Who pays for nursing home care? While most families use a combination of personal savings, private insurance, and assets to cover senior living, some federal and state programs offer assistance to seniors paying for nursing homes. Resources vary by location, care needs, and financial eligibility.

Medicare. Nursing homes often offer short-term inpatient rehab in addition to longer-term senior housing and care. Medicare — a federal program that provides health coverage to seniors age 65 and older — covers short-term stays. It doesn’t cover long-term care.

This is helpful for older adults recovering from an injury or other health event, but it’s not a lifelong solution.

“Medicare pays full coverage for the first 20 days and partial payment for days 21 to 100,” says Michael Leitson, senior data manager at the American Health Care Association. “After day 100, they don’t pay anything.”

Learn more about Medicare’s coverage and some additional benefits of the program.

Most, but not all, nursing homes accept Medicaid. To learn more about how to pay for nursing home care with Medicaid benefits, contact your state’s Medicaid office.

VA benefits. The U.S. Department of Veterans Affairs does provide senior care to veterans who require long-term medical assistance. Senior living covered by the VA is often determined by a senior’s individual health care needs and may include paying for nursing homes. Veterans and their spouses must already be signed up for VA health care and meet enrollment and eligibility requirements based on income, disability level, and location. Learn more about how to secure nursing home payments through the VA here.

Paying for nursing home care with private pay options

In addition to state and federal programs, many families pay for nursing homes using personal resources. Consider the following options, and consult your loved one about their savings and funds.

Savings. Personal savings, or out-of-pocket payments, are the primary way seniors fund nursing home care, according to the National Institute on Aging.

Pensions. A pension is a sum of money paid monthly by a retiree’s former employer. Pension amounts are generally based on position, years of service, and age of retirement.

Retirement income. Retirement income can include social security benefits, benefits from annuities, retirement or profit sharing plans, insurance contracts, or IRAs. Retirement income is often taxable. Speak with an accountant about potential tax breaks and credits for using retirement income to pay for nursing home care.

Stocks. Stock portfolios can be sold to pay for nursing home care. Speak with your loved one’s portfolio advisor to determine the best course of action.

Read more related articles at:

Nursing Home Costs and Ways to Pay

How to Pay for Nursing Home Costs

Also, read one of our previous Blogs at:

Protect Your Estate from Nursing Home Costs

Click here to check out our On Demand Video about Estate Planning.