24/7 home care costs $80,080 a year and Medicare won't cover most of it — but families still have options

Most Americans (around 71%) want to die at home. Unfortunately, only around a third actually do. Dying at home can be logistically difficult for a number of reasons, including the price.

Hospice care can cost $1,600 a day, and while Medicare or private insurance usually cover hospice services, neither typically pays anything for the routine custodial care that’s often necessary in the years leading up to death. This routine care can cost thousands of dollars, and being unable to afford it can leave family members feeling very guilty.

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For example, let’s say Lisa’s parents, Bert and Amelia, are both 89 and really want to die at home. However, both are suffering from a variety of health issues. Lisa and her four siblings want to help, but they can’t provide hands-on care for both parents personally, and they can’t afford to fund it given that the median cost of non-medical caregiving at home is $80,080.

So, what options do Lisa, her siblings, and Bert and Amelia have in these difficult circumstances?

How can you get care covered for a parent at home?

The first thing that Lisa and her siblings must do is to figure out what kind of care Bert and Amelia need, and whether any insurance coverage may be available.

“It’s incredibly important to know that Medicare and Medicaid pay for very different things,” Stefanie L. DeMario-Germershausen, an estate planning attorney and partner at Angiuli & Gentile LLP, told Moneywise.

“For a terminal parent, the Medicare hospice benefit is the most valuable and most underused resource available,” DeMario-Germershausen said. “Once a physician certifies a life expectancy of six months or less, it covers nursing visits, aide visits, medications, and equipment tied to the terminal illness at essentially no cost.”

Unfortunately, Medicare generally won’t cover most types of care at home until Bert and Amelia are close to death. And Medicaid might cover some care, but only after the parents have spent down their assets first.

“When it comes to paying for long-term care or living in a retirement home or assisted living facility, Medicare beneficiaries will need to use their own resources unless or until they become eligible for Medicaid,” Whitney Stidom, Vice President of Consumer Enablement at eHealth, told Moneywise.

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Medicaid is means-tested, and you typically must have very limited income and resources to get benefits. Unfortunately, this means Bert and Amelia might need to spend a significant portion of their savings if they want Medicaid to pay for the services they need to stay home. And even then, Medicaid may not provide all the care that Lisa and her parents are hoping for.

“Depending on the state and the waiver program your parent qualifies for, Medicaid may help pay for personal care at home,” said Coach Michele Williams, who works with licensed home care agency owners. “However, getting 24-hour care through a Medicaid waiver is not common, and families should not assume that Medicaid will cover every hour of care they need.”

What other options are available?

Williams recommends exploring other options if you can’t get Medicare or Medicaid to cover the cost or if you need supplementary care on top of what it will pay for.

Depending on Bert and Amelia’s history, Williams suggested they may be able to get help from the VA, or they may have long-term care insurance they purchased years ago that could help. Or, the couple may also have other assets they can tap.

“For some older homeowners, a reverse mortgage may provide money to use for care at home,” said Williams. Reverse mortgages often provide a lump-sum payment or scheduled payments, but don’t require repayment until you move or pass away. However, Williams warns that “this should be carefully reviewed with a qualified financial professional because the loan must eventually be repaid.”

Alternatively, Williams suggested checking with their insurer if Bert and Amelia have life insurance coverage. “Some policies may allow the owner to borrow against the policy’s cash value or access certain benefits while they are still living,” Williams explained.

Lisa and her siblings can take the time to go through these options with their parents and select the one that makes sense. Ultimately, though, unless Bert and Amelia are in hospice, they’re going to have very limited coverage for care at home, at least until they spend down their assets and Medicaid starts to pay.

Lisa and the siblings may not inherit much if Bert and Amelia drain their savings to cover care costs. But at least Bert and Amelia’s dream of remaining at home could come true.

24/7 home care costs $80,080 a year and Medicare won’t cover most of it — but families still have options

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