How to Build a Plan to Pay for Senior Care

Someone turning 65 today has almost a 70% chance of needing some type of long-term care services and supports, and Medicare won't pay for most of it.1 A federally published Urban Institute research brief estimates 48% of adults who survive to 65 receive some paid care over their lifetime, and finds many older people with severe care needs rely exclusively on family and unpaid caregivers.2 The families who handle it well aren't the ones with the most money. They're the ones who built a plan before the crisis hit. This guide lays out a plan to pay for senior care in five steps: figure out the care and what it costs, take stock of income and assets, find the payers you qualify for, put them in the right order, and get help doing it.

You don't need to have all the answers before you start. You need to know the questions, and where each piece of the puzzle comes from.

A funding plan isn't a single decision. It's a sequence of them, and the order matters. Medicare pays for long-term care only when skilled or rehabilitative care is needed, Medicaid has income and state eligibility requirements, and private sources of payment have their own rules, eligibility requirements, copayments, and premiums. You will have to pay for long-term care services that are not covered by a public or private insurance program.2 So the goal is to know which payers apply to your situation and how to draw on them without tripping over the rules. Here's how to build that plan, one step at a time.

In This Guide

• Step #1: Estimate the Level and Cost of Senior Care
• Step #2: Inventory the Income and Assets
• Step #3: Identify the Payers You Qualify For
• Step #4: Sequence the Payers in Your Plan to Pay for Senior Care
• Step #5: Get Help Building Your Plan to Pay for Senior Care
• Where to Get Public Help
• Frequently Asked Questions
• Learn More

Step #1: Estimate the Level and Cost of Senior Care

Start with the care itself, because every dollar figure flows from it. The question isn't "how much money do we have." It's "what does this person actually need, and what does that cost where they live."

Care levels run along a spectrum. Some people need a few hours of help a week with errands and meals. Others need a home health aide several days a week, a move to assisted living, or full-time nursing care. The level can also change fast, so plan for where the need is likely heading, not just where it is today. Duration is the hardest piece to guess and the most expensive to guess low. One in five of today's 65-year-olds will need long-term care for more than 5 years, and on average women need care longer (3.7 years) than men (2.2 years).1 For nursing home care specifically, the Urban Institute brief finds that half of residents receive no more than two years of nursing home care after 65.1

Then attach a price. The figures below are national medians from the CareScout 2025 Cost of Care Survey, released in March 2026 and the most recent national data. Your state or metro area can run well above or below them.3

In its 2025 survey, CareScout combined homemaker and home health aide services into a single "non-medical caregiver" category, priced at about $35 an hour, or roughly $80,080 a year at 44 hours of care a week.3 Multiply any of these by duration and the number gets serious quickly: at about $114,975 a year, two years in a semi-private nursing home room runs to roughly $230,000, and the Urban Institute brief finds that 15% of all older adults receive more than two years of nursing home care.1 Sizing a plan to a single year is the mistake that hurts most, because the year you leave out costs as much as the one you budgeted. That's the math a plan exists to handle. Our hub on how to pay for senior care breaks the costs down by setting in more detail.

Step #2: Inventory the Income and Assets

Once you know roughly what care will cost, take stock of what's available to pay for it. This step decides which payers are even on the table, because most of them turn on income and asset levels.

Pull together two lists. The first is income: Social Security, any pension, annuity payments, rental income, and required withdrawals from retirement accounts. The second is assets: bank and brokerage accounts, retirement accounts, the home and its equity, life insurance with cash value, vehicles, and anything else of real value.2 Note which assets are easy to convert to cash and which aren't, because a house doesn't help pay an assisted living bill until you sell it, rent it, or borrow against it.

This inventory does double duty. It tells you how long private money would last on its own, and it tells you whether the person is close to qualifying for need-based programs like Medicaid, which covers long-term care costs for people with limited income and assets.2 Get the real numbers down on paper now. Guessing here is where plans go wrong.

Step #3: Identify the Payers You Qualify For

With the care priced and the resources listed, the next step is matching them to payers.2 Think of this as building a roster rather than picking a winner. Here are the main players and who each one is for.

A few of these deserve a closer look as you sort out which apply.

Medicare is the easiest one to misread. It pays for short-term skilled care: up to 100 days in a nursing home, or care at home if you are also receiving skilled home health or other skilled in-home services. At home, that care is generally provided only for a short period of time. The 100 days is a ceiling, not a norm: the average Medicare-covered stay is much shorter, 22 days.1 To qualify for the nursing home coverage, you generally need a qualifying inpatient hospital stay of at least three consecutive days first, and time under observation or in the emergency room doesn't count toward those days. A Medicare Advantage plan may waive the three-day minimum.4 Medicare does not pay for ongoing custodial care, meaning the daily help with bathing, dressing, and eating that makes up the bulk of long-term care.1 Counting on Medicare to cover a long nursing home stay is a costly planning mistake.

Medicaid pays for the largest share of long-term care services.1 It's means-tested, so eligibility turns on income and assets, and you must also meet minimum state eligibility requirements, which are based on how much help you need with daily activities.2 The research brief prepared by the Urban Institute for the U.S. Department of Health and Human Services says Medicaid covers many nursing home residents but very few recipients of residential care or home care.2 Because the rules are detailed and the timing matters, this is the payer worth understanding early. Our guide to Medicaid planning strategies covers how families legally preserve assets and qualify.

VA benefits can add real monthly cash. Aid and Attendance is a monthly payment added to a VA pension, for wartime veterans who meet the pension's income and net worth limits and need another person's help with daily activities like bathing, feeding and dressing.5 A needs-based Survivors Pension, with its own Aid and Attendance rate, serves the un-remarried surviving spouse of a deceased wartime veteran.6 Long-term care insurance pays off only if a policy was bought years ago, so dig out any existing policy and read its benefit triggers. And private pay, drawn from savings, home equity, retirement accounts, and life insurance, fills whatever the others don't. We cover each of those private sources in its own guide, linked at the end.

Step #4: Sequence the Payers in Your Plan to Pay for Senior Care

Knowing which payers apply is half the job. The other half is the order you draw on them, because using them in the wrong sequence can waste money or accidentally disqualify someone from a program they'd otherwise get.

The logic is to use coverage that's already paid for or freely available before you spend down assets you might want to protect. In practice that often looks like this:

The order isn't rigid. Many people pay substantial costs out of pocket until their savings run down and they qualify for Medicaid.2 The point of sequencing is to spend the right dollars first and to avoid moves, like giving assets away for less than they're worth, that can trigger a Medicaid penalty.7 That's exactly where the next step comes in.

Step #5: Get Help Building Your Plan to Pay for Senior Care

You don't have to assemble this alone, and for most families the smart move is not to. Two kinds of help are worth knowing about: public guidance to get oriented, and paid professional advice for the high-stakes legal and financial calls.

Start with the public help. The Eldercare Locator, a public service of the federal Administration for Community Living (ACL), connects you to services for older adults and their families. You can also use it to find your local Area Agency on Aging (AAA), the agency a state designates to address the needs and concerns of older people at the regional and local levels. Call 1-800-677-1116 or visit eldercare.acl.gov.2 Consider making it your first phone call. It's covered in more detail in the next section.

For complex situations, bring in a professional. Consider consulting an elder-law attorney when asset protection or Medicaid eligibility is on the table. A fee-only financial planner, one paid by you rather than by commissions on products they sell, can help you map income, assets, and the sequence of payers without a sales agenda.2 Paying for a few hours of good advice up front is usually far cheaper than the mistakes it prevents.

Where to Get Public Help

Before you pay anyone, use the public help that already exists. The Eldercare Locator is a public service of the federal Administration for Community Living, and one phone number reaches it.2

You can find your local Area Agency on Aging (AAA) by visiting the Eldercare Locator website or calling 1-800-677-1116. An AAA is a public or private nonprofit agency designated by a state to address the needs and concerns of all older persons at the regional and local levels. ACL says AAAs coordinate and offer services that help older adults remain in their homes, if that is their preference.2

Learn More

The steps above point outward to the rest of your plan. These guides go deeper on the pieces:

Find personalized help building a plan to pay for senior care at brevy.com.

The information on Brevy.com is for educational purposes only and is not a substitute for professional legal, financial, or medical advice. Rules vary by state and program and change frequently. Always verify with the relevant agency or a qualified professional. Brevy is not a law firm, financial advisor, or healthcare provider.