FAIR Health Consumer Access

Managing Costs for Day Programs for the Elderly and Disabled Younger Adults

An adult day program is a type of long-term care program you go to during the day. Some programs provide needed health services or personal care, like bathing or dressing. Others mostly provide fun and social things to do. For people with severe disabilities or specific health conditions, there are programs that have medical staff and equipment. Program costs vary, but most aren’t covered by health insurance. This article will tell you some ways to manage costs for adult day programs. These include private, government and other ways to save on day programs for the elderly and disabled younger adults.

This article doesn’t provide legal or financial advice. Consider speaking to a financial advisor or lawyer if you have questions about your specific situation.

Private Options
Private health plans. Private health insurance usually won’t cover day programs for disabled adults or the elderly. Sometimes it covers skilled, medically necessary care, but only for a short time, so check with your insurance plan. Disability insurance won’t cover adult day programs at all. However, if you have long-term care insurance, that could help.

The costs of long-term care insurance depend on certain things. Some of these are the type of policy, the number of services and how old you are when you buy it. Some plans won’t pay for social programs, only healthcare programs. Also, if you already need care services, you may not qualify, or costs may be higher for long-term care insurance. Find out more at longtermcare.gov.

Private payment. Many older adults use their savings, retirement funds or money from family to pay for day programs. The same is true for families of disabled adults. Other private ways to pay include:

• Annuities. This is a contract between you and an insurance company. You pay the company a lump sum or a series of payments and it gives you future regular payments for a fixed amount of time, or sometimes for the rest of your life.
• Trusts. A trust is like an account that is managed by one person or an organization, where money or property is kept for the benefit of another person. You can set up a trust for an elderly person or a younger adult with a disability.
• Life insurance cash-out. If you have a life insurance policy, you can sometimes take money out of it early.

Before choosing any of these options, consult a trusted financial advisor. The advisor can help make sure your decisions make sound financial sense. The advisor can also help explain the risks involved in each option. The Consumer Financial Protection Bureau can help you find fair financial information and avoid scams. In addition, consult a tax professional to find out how the above private payment options affect your taxes, and an attorney to address any questions related to trusts or other legal topics.

Government Coverage for Elderly Day Programs
Medicare. Medicare is health insurance funded by the federal government for people 65 or older. Original Medicare won’t cover elderly day programs. But if you have Medicare Advantage, it might pay for some day program services. You can sign up even if you have a preexisting condition.

Medicaid. Medicaid is government health insurance for low-income people, generally run by each state. Currently, Medicaid will cover elderly day programs in all states. However, different states’ rules related to what Medicaid will cover aren’t all the same, so check with your state’s Medicaid program.

Program of All-Inclusive Care for the Elderly (PACE). PACE provides health and social care to frail, elderly people living in the community. This can include day programs. Most people in PACE are eligible for both Medicare and Medicaid. But if you’re only on Medicare, you can take part in PACE by paying a monthly premium. Check out your state’s PACE programs.

Older Americans Act. The Older Americans Act was passed in 1965. It gives money to states for community-based services for adults over age 60, including rides to and from your home. Visit the Administration for Community Living to find out more.

Department of Veterans Affairs (VA). If you’re a veteran, the VA may cover adult day care. Find out more and how to apply at the VA’s Geriatrics and Extended Care site.

Government Coverage for Disabled Younger Adult Day Programs
Medicaid. Medicaid will often pay for home and community-based services for disabled people, which can include adult day programs:

• Intermediate care facilities for people with intellectual disabilities (ICF/ID) are a benefit typically offered by Medicaid. You can only get ICF/ID if you’re getting “active treatment services.” This means care or medicine that you need regularly over a long period of time. In other words, ICF/ID is for disabled people who need a lot of help every day. Your disability must also have started before age 22. Find out more here.
• States also offer their own Medicaid waivers that can cover services. There are waivers just for people with disabilities who may not meet all the normal requirements for Medicaid.

Social Security benefits. You might be able to get Social Security benefits if you’ve worked enough or have low income. This could help pay for adult day programs. Check out our article on Benefits for People with Disabilities for more details.

Public school. Students with disabilities can get free public schooling until they’re 21 years old. This is per the Individuals with Disabilities Education Act (IDEA).

Other Ways to Save
Organizations. Some groups, such as the Alzheimer’s Association or the Autism Society, may be able to offer financial help for day programs. If you need full-time medical care, look online for organizations that support patients like you or your loved ones.

Discounts. If you have to pay out of pocket, ask the program whether it offers a sliding scale. You may only have to pay what you can afford.

Deductibles. Most adult day care is tax-deductible. It can be added as a medical and dental expense on your taxes. Or, if you or your loved one is a dependent, costs may be deductible under the Dependent Care Credit. Ask your accountant for more information.

Resources
To find an adult day care service where you live, check out the National Adult Day Services Association (NADSA).

The National Institute on Aging: Services for Older Adults Living at Home provides information on services for the elderly.

Aging and Disability Resource Centers (ADRCs) offer information on care options for both the elderly and disabled younger adults. Find your local center at Eldercare locator.

If you’re a caregiver, check out FAIR Health’s article: Help for Caregivers.