How to avoid large nursing home bills

The cost of nursing home care can seem overwhelming on the surface, but the fact is, there are a number of payment options and financial assistance solutions available that can make this type of care a viable option.

One of the first steps is to determine eligibility for one or more of the government-funded options. If you or your parent or loved one qualifies for one of these coverage options, it can significantly limit your out-of-pocket expenses and help stretch savings over time.


Medicare benefits for nursing home care are limited since it’s not intended to be a long-term care solution. Instead, Medicare benefits are designed to provide skilled nursing care for a limited time, sometimes called short-term nursing home care or convalescent care. For example, a person who requires care to recover from a hip injury will be covered while a person suffering from Alzheimer’s who requires nursing home care will likely not be covered.

Medicare typically covers 20 days of care at 100 percent of the cost. For the 80 days following, you may be required to pay a portion of the daily cost, though Medicare Supplemental Insurance plans will pay the remaining cost for the last 80 days of coverage. Neither option, however, pays for nursing home care after the 100-day maximum.


Medicaid is the largest single payer for nursing home care, covering between 45 and 65 percent of all nursing home costs in the United States. On the surface, this may sound encouraging, but it’s important to remember that Medicaid is a means-tested program. That means individuals must meet strict financial guidelines in order to qualify. Once qualified, though, Medicaid will pay for 100 percent of nursing home costs at a Medicaid-approved skilled nursing facility.

Medicaid’s eligibility requirements depend on age, marital status, and state of residence, and of course, requirements are adjusted each year. Certain resources, such as the family home, may be exempt from Medicaid’s asset limit, and other resources can be allocated to a spouse if needed. Similar exceptions are made for income, which can also be transferred to their spouse. You will want to work with the case manager at your nursing home facility of choice to navigate the complexities of Medicaid eligibility.

Veterans Assistance

The Aid and Attendance Benefit (also known as the Improved Pension) provides financial assistance to war-time veterans and their survivors that may require the aid of another person in order to perform activities of daily living. This program is intended for those with limited financial means, though it’s not as limiting as Medicaid. A veteran’s income and financial assets are still both considered during the application process, and the benefits can be used to cover the cost of nursing home care or assisted living.

Other Financing Options

Even those who may not qualify for government or veterans’ assistance programs still have financial support options available, including:

  • The proceeds from a reverse mortgage can help pay for nursing home care by letting a homeowner borrow the equity in their home. The equity is the difference between the value of a home and any remaining loans on the property. There are typically no payments required on the loan (though the homeowner is responsible for taxes and insurance expenses), and the loan is paid off when the property is sold.
  • Long-term care insurance can provide full or partial coverage for long-term care, including nursing home coverage. As with many types of insurance, the premium costs are lower for policyholders who are younger and in good health, so it’s wise to shop early. This type of insurance can supplement traditional health insurance and possibly protect your savings and other assets.
  • As with other medical expenses, nursing home expenses may be tax deductible if the need for care is primarily medical. In that case, all expenses – including meals and lodging – may be deducted. Of course, you’ll want to consult with your own tax advisor about your specific situation.
  • One final option may be relocating. If you have the flexibility, you can take advantage of the wide range of nursing home costs across the country. According to the American Council on Aging, the U.S. national average cost of nursing home care in 2020 was $105,850. But individual states were as high as $450,000 or as low as $55,000 during the same time period. If you have ties outside your home state, it may be worthwhile to check costs in neighboring states or even in other regions within your home state. In Alabama, for example, the average cost varied by as much as $20,000 in 2020.

If your parent or loved one has reached a point where you’re considering nursing home care, it’s time to evaluate and select a facility that can help. Facilities managed by American Health Corporation – including three locations in Alabama – offer the highest quality healthcare nearby and offer assistance in making complex financial decisions regarding funding for nursing home care.

Contact the American Health Corporation nursing home in your area today for more information or to schedule a guided tour:

Oak Trace (Bessemer, AL) 205-428-9383

Colonial Haven (Greensboro, AL) 334-624-3054

Perry County Nursing Home (Marion, AL) 334-683-9696