Nursing home care is expensive both for individuals and for state and federal governments. While the cost is usually far lower than that for acute care hospitalization, lengths of stay average months to years rather than days. In 1990 the average rate per day was about $80. About 60% of nursing home revenue comes from the jointly sponsored federal-state Medicaid programs and about 13% from Medicare. Other sources, such as health insurance plans and individual policies, health mainte¬nance organizations (HMOs), the Veterans Administration, and per¬sonal savings, account for the remainder of their revenue.
Patients who pay for their own nursing home stays may find that the fees quickly deplete assets, rendering them indigent and thus eligible for Medicaid. However, spending down assets to pay for nursing home care has two consequences for residents: (1) For couples, depletion of joint assets may jeopardize the welfare of the spouse remaining in the community. (2) No assets remain for the patient’s return to the commu¬nity, if that becomes clinically feasible; thus, nursing home placement may become permanent out of financial necessity