Private Pay

Long Term Care Insurance

Paying For Nursing Home  Care

The cost of long-term care can be a staggering blow to many families. Primarily families pay from their private funds, long term care insurance, or benefit from the government programs of Medicaid or Medicare as payment methods in nursing homes. Some families may have to spend their personal wealth before benefiting from the government programs.

Click on the options in this section to gain more information about which option may suit your situation best. Your Regional Ombudsman will be glad to answer any questions you may have about nursing home payment.

Copyright 2000 AR Division of Aging and Adult Services 



Many people believe that Medicare will cover the cost of nursing home care.  Medicare only pays for nursing home costs under specific guidelines and for a certain number of days:

  1. The individual entering a nursing home must require skilled nursing or rehabilitation services.  This does not include custodial, intermediate or personal care.
  2. The nursing home care is provided after a three day or longer hospital stay for treatment of the same illness or condition.
  3. The nursing home must be Medicare approved and the bed the individual is assigned must be certified for Medicare reimbursement.
  4. All covered services for the first 20 days of care are fully paid by Medicare.  For the next 80 days a co-payment is required of the individual's health insurance.  Starting at day 101 the individual is responsible for all charges.
  5. Always ask if a facility is certified for Medicaid payment after Medicare benefits are exhausted.  If the facility is not dually licensed, you may have to move to another facility.



Long Term Care Medicaid: Conditional Eligibility Requirements

Even if you already receive Medicaid benefits, you must apply for long-term care Medicaid for nursing home payment.  You do this at your county Department of Human Services Office.

  1. The Individual must be a U.S. citizen or qualified alien.
  2. The individual must be a resident of Arkansas.  If the individual is coming from another state, prior approval must be obtained from the Office of Long Term Care, Medical Need Determination Section.
  3. Categorical eligibility requires that the individual be 65 years of age or older, or; 
  4. Blind (visual acuity of 20.200 or less, or limited visual field of 20 or less, with best correction, or;
  5. Disabled (unable to engage in sustained gainful work activity for a least 12 months as determined by the Social Security Administration or the Medical Review Team.)

Long Term Care Medicaid: Financial Eligibility Requirements

There are two categories for financial assets that are taken into account in determining an individuals eligibility for Medicaid: income and resources

INCOME:  Think of income as the amount of money an individual receives.  This would include Social Security, Veteran's benefits, railroad retirement, pensions, annuities, dividends, rental income, withdrawals from IRA, etc.  For the year 2016, the acceptable monthly income cap is $2,199.00. The income limit usually increases at the first of each calendar year. Income of spouse and children not counted. Persons applying for the Assisted Living waiver may establish eligibility through an income trust.

RESOURCES: Resources are countable things of value a person has ownership in. Resources include real property, cash, checking and/or savings accounts, certificates of deposit, promissory notes, mortgages, stocks, mutual fund shares, bonds, trusts, automobiles, life insurance policies with a cash value, IRA's, Revocable burial funds, etc

Resources that are not usually counted:

The Home - If the equity interest of the home is less than or equal to $552,000. If your spouse, your child under age 21, or your blind or disabled child resides in the home. If you, your spouse or a relative dependant on the home for shelter resides in the home.

One motor vehicle

Burial spaces for any member of the individual's immediate family

Prepaid irrevocable burial plans

The resource limit for the covered individual is $2,000. If you have a spouse living at home, special protection of resources are available based on total resources for you and your spouse. In 2016, the amount is between $23,844 and $119,220 based on a formula.

Individuals who exceed these requirements might still be able to qualify by creating what is known as a Miller's Trust.  Contact your county Department of Human Services office for more information.



About half of all nursing home residents pay the costs out of their own savings.  Most nursing homes have a private pay rate that is higher than the Medicaid reimbursement rate.  This rate varies from facility to facility.  Be sure to ask about the rate and determine what services you will be expected to pay for in addition to your room rate.  Make sure that the Admissions Contract spells out exactly what charges you are responsible for before you sign the contract.  Depending on the length of the nursing home stay, an individual may exhaust all of his/her savings and be eligible for Medicaid. Even if you are paying for care yourself, it is a good idea to determine in advance if the facility is Medicaid eligible. 



It is generally acknowledged that long term care coverage is the glaring hole in the safety net provided by Medicare, Medicaid and private health care insurance.  As with most insurance, the younger you are when you enroll in a plan, the more reasonable the premiums.  

Even if you enroll early, the costs of long term care insurance reflects the staggering cost of nursing home care.  Before you select a plan, it is important to understand the cost and benefits.  Assistance in determining your options is available through SHIP, the Senior Health Insurance Program at 1-800-224-6330.