Without Careful Planning, Nursing Home Costs Could Run into Six Figures Annually

People want what is best for their family members. Adult sons and daughters often devote substantial money and effort to finding the right nursing home for their parents. Likewise, individuals who are approaching their senior years don’t want to leave their loved ones with a major financial burden. 

According to the American Council on Aging, the average monthly cost of a nursing home in 2024 hovered around $10,000. That’s just the national average. New Jersey residents know that the relative cost of living means that critical services can be much more expensive here than in other parts of the country. 

Many families fall into the trap of thinking that Medicare will cover all or most nursing facility costs as long as the beneficiary is at least 65 years hold. This is not the case. Medicare will pay 100 percent of the bill for the first 20 days in a nursing home only when the stay is medically necessary for rehab and follows a qualifying hospital stay. From days 21 to 100, Medicare pays a portion, with the patient responsible for a daily copay—$217 per day for 2026. After day 100, Medicare coverage ends, and the patient is responsible for all costs.

Of course, many stays in nursing homes and similar facilities last more than 100 days. Some go on for several years. An older person might have long-term care coverage obtained through their employment or purchased on their own. However, worker benefits such as these are the exception, not the rule, and purchasing a private policy might not be within a family’s budget. 

Each situation must be evaluated based on its own circumstances, but with proper planning, Medicaid might be a solution to the exorbitant cost of nursing home care. By shifting property into a Medicaid Asset Protection Trust well before they need to enter a facility, an individual could be eligible for government benefits that assist people who qualify. We, as knowledgeable Medicaid planning attorneys can examine your situation and advise on key issues such as the five-year lookback period, spousal protections and permissible spend-downs, such as payments for home safety modifications, medical equipment and prepaid funeral expenses. 

At The Paton Law Firm LLC in Fair Lawn, we develop effective plans to help North Jersey clients address long-term care needs for themselves and their parents. Please call 201-470-4801 or contact us online for a free initial consultation.