Paying for the Long Haul
Financial Planning to Stay in Your Home
Ming had always been careful with money. She worked hard, saved what she could, and paid off her house years ago. At 74, she figured she was set.
Then her knee started giving her trouble. She needed help with groceries. Cleaning the house became harder. One day, her daughter suggested they look into getting some help at home—maybe someone to come by a few times a week.
Ming made some calls. And what she found surprised her.
"I thought Medicare would cover it," Ming said. "But it doesn't work the way I thought."
Ming isn't alone. Many people assume that Medicare or their health insurance will pay for help at home as they get older. But the truth is more complicated. Understanding what's covered—and what's not—can help you plan ahead and avoid surprises.
What Does Medicare Cover?
Medicare is health insurance for people 65 and older. It covers doctor visits, hospital stays, and some home health care. But there are limits.¹
Medicare will pay for home health care if:
You're "homebound," meaning it's hard for you to leave your house
You need skilled care, like nursing or physical therapy
Your doctor orders it
The care is part-time or short-term¹ ²
So if you break your hip and need a physical therapist to come to your house for a few weeks, Medicare can help. If you need a nurse to change a wound dressing or give you a shot, Medicare can help with that too.
But Medicare does not pay for long-term help with daily tasks like bathing, dressing, cooking, or cleaning—unless you also need skilled medical care at the same time.² ³ If you just need someone to help around the house or keep you company, Medicare won't cover it.
What About Medicaid?
Medicaid is a different program. It's for people with low incomes and limited savings. In New York, Medicaid can pay for long-term home care services that Medicare doesn't cover.⁴
This includes help with things like:
Bathing and dressing
Cooking and cleaning
Getting to appointments
To qualify for Medicaid in New York, you have to meet certain income and asset limits.⁴ The rules can be complicated, and they change from year to year. In 2025, a single person applying for Medicaid home care generally needs to have income under about $1,732 per month and limited savings.⁴
If you think you might qualify, your local Office for the Aging can help you understand your options.
What If I Don't Qualify for Medicaid?
Many people earn too much or have too many savings to qualify for Medicaid, but they still need help. That's where other programs come in.
EISEP (Expanded In-Home Services for the Elderly Program) is a New York State program for people 60 and older who need help at home but don't qualify for Medicaid.⁵ ⁶
EISEP can help pay for:
Personal care (like help with bathing or dressing)
Housekeeping and meal prep
Case management
Respite care for family caregivers
EISEP uses a sliding scale. That means the cost depends on your income. Some people pay nothing. Others pay a small share of the cost.⁵ To find out if you qualify, contact your local Office for the Aging.
What About Long-Term Care Insurance?
Long-term care insurance is a type of private insurance you can buy. It helps pay for care at home, in assisted living, or in a nursing home if you need help with daily activities.⁷
Many policies cover:
Home health aides
Personal care services
Nursing home stays
The catch? You usually need to buy this insurance before you need it—ideally in your 50s or early 60s. Once you already need care, it's often too late to get a policy. And the older you are, the more expensive the premiums.⁷ ⁸
If you already have long-term care insurance, read your policy carefully. Some policies only cover care from certain agencies. Some have waiting periods before benefits kick in.⁸
Can Life Insurance Help Pay for Care?
Here's something many people don't know: some life insurance policies can actually help pay for care while you're still alive.
This is called an "accelerated death benefit" or "living benefit." It lets you access part of your life insurance payout early if you're diagnosed with a serious illness.⁹ ¹⁰
When can you use it? Most policies require you to have a terminal illness—meaning doctors expect you to live two years or less.⁹ But some policies also allow living benefits if you have a chronic illness that makes it hard to do daily tasks like bathing or dressing, or if you need long-term care in a nursing home.¹⁰ ¹¹
How much can you get? It depends on your policy. Some let you access 25% to 50% of your death benefit. Others allow more.¹² The money can be used for anything—medical bills, home care, everyday expenses.¹³
Is there a cost? Many life insurance companies include this feature for free. Others charge a small fee or add it as a "rider" (an add-on to your policy).¹² If you're not sure whether your policy has this option, call your insurance company and ask.
What's the downside? If you use part of your death benefit while you're alive, there will be less left for your family after you pass.¹³ Also, getting a large sum of money could affect your eligibility for Medicaid or other benefits. It's a good idea to talk to a financial advisor before making this decision.¹⁴
Another option: selling your policy. If you have a terminal illness, you might be able to sell your life insurance policy to a company for cash. This is called a "viatical settlement." The company pays you a portion of the death benefit now, and they collect the full benefit after you pass.¹⁴ This can give you money to pay for care—but it means your family won't receive anything from the policy later. And not everyone qualifies.
How Much Does Home Care Cost?
Paying out of pocket for home care can add up fast. In New York, a home health aide can cost $25 to $30 or more per hour.¹⁵ If you need someone for 20 hours a week, that's over $2,000 a month.
That's why planning ahead matters. Even small steps can help:
Set aside savings specifically for care needs
Look into programs like EISEP before you need them
Talk to your family about how you'll handle costs together
Consider long-term care insurance if you're still young enough to qualify
Check your life insurance policy to see if it has living benefits
Ming's Story Continues
Ming did some homework. She found out she didn't qualify for Medicaid, but she did qualify for EISEP. A case manager helped her set up a few hours of home care each week at a cost she could afford.
She also looked at her life insurance policy—one she had kept for years. She was surprised to learn it had a living benefit option. She didn't need to use it right now, but it was good to know it was there if things ever got harder.
"It's not free," Ming said. "But it's a lot less than I thought. And it means I can stay in my own home."
She also sat down with her daughter and made a plan. They talked about what would happen if she needed more help down the road—and how they would handle it together.
"I wish I had started thinking about this sooner," Ming said. "But I'm glad I know now."
Where to Get Help
Your local Office for the Aging. Every county in New York has one. They can help you understand your options, apply for programs like EISEP, and connect you with other resources.¹⁶
NY Connects. A free hotline for information about long-term care services. Call 1-800-342-9871.¹⁶
Medicare.gov. The official site for Medicare information, including what's covered and how to find home health agencies in your area. https://www.medicare.gov
Your life insurance company. Call them to ask if your policy includes living benefits or an accelerated death benefit rider.
HIICAP (Health Insurance Information Counseling and Assistance Program). Free help understanding Medicare and other health insurance. Contact your local Office for the Aging to find a counselor.¹⁶
I am not providing legal, tax, or Medicaid planning advice. This article shares general information only. It is not financial or legal advice. Every person's situation is different. Talk to a financial advisor or your local Office for the Aging to learn what options might work for you.
References
Medicare.gov. "Home Health Services Coverage." https://www.medicare.gov/coverage/home-health-services
AARP. "Does Medicare Cover Home Healthcare?" https://www.aarp.org/medicare/faq/does-medicare-cover-home-healthcare/
National Council on Aging. "7 Things to Know About Medicare's Home Health Care Benefit." https://www.ncoa.org/article/seven-things-you-should-know-about-medicares-home-health-care-benefit/
Medicaid Planning Assistance. "New York Medicaid Eligibility: 2025 Income & Assets Limits." https://www.medicaidplanningassistance.org/medicaid-eligibility-new-york/
New York State Office for the Aging. "Expanded In-home Services for the Elderly (EISEP)." https://aging.ny.gov/expanded-home-services-elderly-eisep
New York State Department of Health. "Expanded In-home Services for the Elderly (EISEP)." https://www.health.ny.gov/health_care/medicaid/program/longterm/expand.htm
A Place for Mom. "Long-Term Care Insurance: An In-Depth Guide." https://www.aplaceformom.com/caregiver-resources/articles/senior-care-insurance
A Place for Mom. "Using Long-Term Care Insurance to Pay for Home Care." https://www.aplaceformom.com/caregiver-resources/articles/using-ltc-insurance-for-home-health-care
NerdWallet. "How Does an Accelerated Death Benefit Work?" https://www.nerdwallet.com/article/insurance/accelerated-death-benefit
Progressive. "What Is An Accelerated Death Benefit Rider?" https://www.progressive.com/answers/accelerated-death-benefit-rider/
Aflac. "What Are Living Benefits of Life Insurance?" https://www.aflac.com/resources/life-insurance/living-benefits-of-life-insurance.aspx
Paying for Senior Care. "Life Insurance Accelerated Death Benefits: Pros & Cons." https://www.payingforseniorcare.com/financial-products/insurance
SmartAsset. "How An Accelerated Death Benefit Works." https://smartasset.com/financial-advisor/accelerated-death-benefit
Administration for Community Living. "Using Life Insurance to Pay for Long-term Care." https://acl.gov/ltc/costs-and-who-pays/who-pays-long-term-care/using-life-insurance-to-pay-for-long-term-care
TheKey. "Medicare and Home Care: What's Covered and Out-of-Pocket Costs in 2025." https://thekey.com/learning-center/medicare-home-care
New York State Office for the Aging. "Local Offices." https://aging.ny.gov/local-offices