With the median cost of a private room in a U.S. nursing home reaching $9,733, it’s no surprise that many seniors and their families want to maximize available resources to cover the cost of nursing home care.
Benefits provided by the Social Security Administration can be key to accessing senior care. We’re here to help you learn how to pay for nursing home care with Social Security.
What are Social Security Benefits?
Programs offered by the Social Security Administration are an economic lifeline for retired individuals and people with disabilities. These programs include traditional Social Security benefits and Supplemental Security Income (SSI).
Individuals qualify for Social Security benefits based on their lifetime earnings. Employer and employee contributions fund these benefits through payroll taxes. The average Social Security check amount is $1,778.24 per month.
SSI, on the other hand, is a needs-based program designed for low-income adults, including those who are disabled or blind. The maximum SSI benefit for an individual is $943 per month, while the maximum SSI benefit for a couple is $1,415 per month.
Is Social Security Enough for a Nursing Home?
Benefits received from the Social Security Administration can certainly help cover the cost of nursing home care. However, given the price tag of living in such a facility, many seniors and their families will need to combine these benefits with other forms of financing.
The Role of Medicare and Medicaid in Nursing Home Care
Given that the average Social Security or SSI check is not enough to cover the entire cost, many seniors and their families wonder if it’s possible to use Medicare or Medicaid to pay nursing home expenses.
Medicare is a federal health insurance program for people aged 65 and older, as well as younger people with disabilities. Many people mistakenly believe that Medicare will cover the long-term costs of living in a nursing home. However, Medicare does not pay for long-term care.
Medicaid is a joint federal and state program that helps people with low income cover their medical expenses. While the federal government sets general rules for Medicaid, each state runs its own Medicaid program and sets its own eligibility requirements.
If you qualify for Medicaid, you can use Medicaid benefits to cover some of the cost, but there are important caveats. For example, Medicaid requires that you use most of your monthly income, including Social Security benefits, to pay for nursing home expenses. Medicaid then covers the remaining costs. Furthermore, not all nursing facilities accept Medicaid as a form of payment.
Using Social Security Income To Pay for Nursing Home Care
While Social Security benefits alone are not enough to fully cover nursing home costs, you can still apply them directly to nursing care expenses. You can then cover the remaining balance through other means, such as personal savings, Medicaid or other financial resources.
If you qualify for Medicaid, most of your Social Security check will be allocated toward the cost of a nursing home, with Medicaid covering the shortfall. Medicaid typically covers basic services, such as a shared room, meals, nursing care, rehabilitation services and personal hygiene items.
Supplemental Options
For many families, Social Security and Medicaid is not enough to cover all nursing home expenses. Here are some supplemental options that may close the gap.
Veterans' benefits are a potential source of support for those who have served in the military. Eligible veterans may qualify for financial assistance that can help cover nursing home care, as well as other types of senior living.
Long-term care insurance can provide significant financial relief, but it is typically more affordable when purchased at a younger age. If you have long-term care insurance, it's important to review your policy to understand what is covered and how it can supplement your Social Security benefits.
Planning for Nursing Home Care Costs
Early planning can help ensure that you have sufficient resources to cover the expenses without depleting your savings or leaving your family in financial distress.
Working with a financial advisor who specializes in elder care can be invaluable. A financial advisor can help you explore all available options, including Social Security, Medicaid, veterans' benefits and other resources. They can also assist with creating a financial plan that accounts for potential long-term care needs.
To maintain eligibility for government benefits that can lower the cost of nursing home care, you may want to speak with an elder law attorney. Your attorney can provide guidance on the best legal strategies for your specific situation–which may include establishing a trust or making strategic asset transfers.
Your financial advisor and attorney can also help you and your spouse understand and benefit from Spousal Impoverishment Protection (SIP). If one spouse needs to use Medicaid to access nursing facility care but the other spouse is still living independently at home, SIP can ensure the spouse who stays at home still has enough income to cover their living expenses.
How To Pay for Nursing Home Care With Social Security
Paying for nursing home care is a significant financial challenge, but with the right planning and resources, it is possible to manage these costs effectively. While Social Security benefits can help cover a portion of the expenses, they are rarely enough on their own. Medicaid, long-term care insurance, veterans' benefits and other financial resources can all play a role in filling the gap.
If you’re wondering how to pay for nursing home care with Social Security or how to approach any other aspect of affordable senior living arrangements, check out this list of counseling agencies. A housing counselor can evaluate your situation and connect you with the resources you need.
