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When exploring assisted living for your loved one, the cost can be a stressful and prohibitive factor. According to a Genworth Financial survey of long-term care costs, the average cost of a private room in a nursing home tops $100,000 a year. This total is about 1.6 times the average national annual household income.
Although assisted living costs vary depending on location, services, accommodations, and amenities, many seniors and their families find that the expenses are still out of reach without the assistance of social programs and/or insurance. As you explore these costs and factor them into your decision-making, you are likely wondering if programs like Medicare can help alleviate some of this financial burden.
Does Medicare Pay for Assisted Living Costs for Seniors?
Medicare does not typically cover the costs of long-term care facilities or assisted living facilities. However, Medicare typically covers certain qualifying health care costs while in an assisted living facility. This excludes custodial care and room and board.
While there are certain exceptional circumstances that may qualify for Medicare coverage in an assisted living facility, the majority of Medicare recipients will not receive coverage for costs involved in custodial care.
Though it might not necessarily apply to assisted living, Medicare Part A may cover up to 100 days of care in a skilled nursing facility (SNF). For the first 20 days of care at an SNF, Medicare will cover 100% of the cost of care. However, Medicare covers just 80% of the cost of care for up to 80 additional days. Care in an SNF must also be intended only for recovery after an in-patient hospital stay.
SNF could be helpful as an alternative for certain circumstances, such as an elderly loved one who is recovering from a stroke or an injury, since this would only require short-term care. Unfortunately, Medicare does not cover any additional SNF days of care or long-term care.
In certain states, Medicaid can be used to cover a portion of the costs incurred in an assisted living facility, particularly for those with limited income.
Covering Assisted Living Costs with Medicaid
If your loved one is not currently on Medicaid, we recommend that he or she applies before entering an assisted living facility. In order to be eligible for Medicaid, your loved one must meet the following eligibility requirements.
- Permanent resident or citizen of the U.S.
- Low-income earner
- Medical care expenses exceed income
- Resident in the state distributing benefits
Think of Medicaid as a sort of social safety net for those unable to afford the care they need. Similar to Medicare, Medicaid is like a health insurance policy that covers just about every type of health care cost. More importantly, Medicaid can cover long-term assisted living costs or alternatives like in-home care.
Some state Medicaid programs include PACE (Program of All-Inclusive Care for the Elderly), which covers all costs related to senior care. This not only helps to cover the cost of assisted living facilities but also allows more people to utilize at-home support as a more comfortable alternative.
State Specifics on Medicaid Coverage
As of May 2018, Medicaid programs in 46 states and the District of Columbia will cover at least part of assisted living expenses or residential care. The Medicaid programs in Alabama, Kentucky, Louisiana, and Pennsylvania are the only ones that do not cover any costs of assisted living. Many states offer an alternative, state-specific programs that function similarly to Medicaid.
Your loved one might not qualify for these alternative programs. Alternatively, these programs might not cover the entire cost of treatment. In this event, residents of these states might want to consider private insurance or other alternative forms of coverage.
Short-Term Care Solutions for Medicare Recipients
In addition to SNF, Medicare does offer some amount of coverage for a few short-term care solutions.
- In-Home Care– Medicare may cover the cost of skilled, in-home nursing care for a limited period of time. A doctor must prescribe this care, on a part-time basis only. It must not include non-medical care. Additionally, the senior in question must be considered “homebound.” This means they cannot leave the home without assistance from another person.
- Alzheimer’s/Dementia Care– Unfortunately, Medicare does not cover most of the care services required for Alzheimer’s patients. However, there is a hospice benefit that Medicare beneficiaries can apply who have very late stage Alzheimer’s.
- Hospice– Medicare does cover hospice care for terminally ill patients who have fewer than six months to live. This determination must come from their doctors. This includes homemaker services, medical expenses, prescription drugs, and medical expenses, but not room and board. Most hospice care is an in-home service, but one may choose inpatient care as well.
Although Medicare does not traditionally cover the cost of assisted living care, this does not mean all hope is lost. Consider the options outlined above, and discuss the options that work best for you with a health care professional.