Without a doubt, one
of the most common questions that comes through our site has
to do with how to pay for assisted living, and if Medicare covers
any or all of the cost of assisted living. Many of the messages
that we receive are from children of aging parents who are suddenly
faced with the reality of placing their mom or dad into a long-term
care environment, or assisted living - and not having any idea
of how they, or their parents are going to afford the cost of
the care. Unfortunately, too many families do not plan in advance
for long-term care, and families are often times surprised...even
shocked at how expensive assisted living can be. Unfortunately,
many people make the assumption that assisted living will be
covered by health insurance, Medicare, or our government in
some way - only to learn that much of, if not all of the cost
will be coming out of their own pockets.
Without thoughtful advance
planning, out-of-pocket expenses for an aging loved one can
be financially devastating.
talk about what we have seen as far as the cost of assisted
Assisted Living, like
most other housing arrangements, will be more, or less expensive
based on a number of factors:
Location of the facility: Is the facility located in an upscale
part of town, or neighborhood, or is it located in a more affordable
part of town?
Are the rooms private, or semi-private? Will each resident have
a 'roommate' and are bathrooms shared? A private room will most
likely cost more.
What amenities and services are provided, and are extra services
and amenities more expensive, or is everything included in the
monthly cost? Some facilities may offer bare-bones amenities
and services, that could be limited to simple housekeeping,
basic personal assistance with hygiene and getting dressed,
and basic daily meals. Other facilities may be more resort-like,
offering things like a concierge service, a full activities
calendar, organic foods and meals prepared by a highly talented
or high-profile chef and kitchen crew - and decor and landscaping
that has the look and feel of an elegant hotel. Naturally, one
would expect facilities with more amenities to cost more. Additionally,
residents with more complex health issues can probably expect
to pay more for their care than a more independent resident
who does not have a condition such as Alzheimer's
Disease or Parkinson's
Are items such as cable TV, telephone usage, and other utilities
and 'extras' included, or will those incur an extra charge.
If the monthly rate looks 'reasonable' - but these 'extras'
aren't included - the true cost of the facility may be higher
In general, the average
cost of assisted living can be around $2500 to $3000 per month.
We have seen assisted living facilities in excess of $7000 per
month that offer premier services and amenities. Finding an
assisted living facility in your desired price range can take
a lot of research, patience, as well as flexibility on location,
amenities, and other 'extras.'
If your loved one does
not have significant health issues, and is fairly independent
- then looking into a 'senior community' may be a better option
in terms of expense. Senior Communities don't offer the higher
level of care as an assisted living facility, since they are
targeted to more independent seniors - but they are likely to
have a lower monthly cost than an assisted living facility.
How to pay for assisted living
Private-Pay: Paying for assisted living entirely
'Out-of-pocket' is often referred to as "Private-Pay."
This essentially means that the resident will be using personal
finances or assets to pay for all of the care and services.
Keep in mind that people who are able to pay for care with insurance
are also considered 'private pay' since this is not a payment
that uses governmental sources or programs.
Long-Term Care Insurance: Like any other type
of insurance, Long-term-care insurance is designed to offset
the costs and expense of long-term-care for people who will
not be able to qualify for Medicaid. Unfortunately, people who
already have disabilities or illnesses will not qualify for
long-term care insurance since they already require care and
services (similar to a 'pre-existing condition). Upper age limits
may also exclude individuals from qualifying. In these cases,
the individual will need to pay for care through other means,
such as Medicaid, or through Private Pay. Most policies pay
a fixed dollar amount towards each level of care with higher
levels of care being reimbursed at an increased rate.
Careful shopping is
essential when purchasing a long-term care policy, as one policy
may be vastly different from another policy in terms of benefits
and coverage, qualifications, rules, and flexibility, exclusions,
and waiting periods. The cost of long-term care insurance can
vary widely as well - sometimes in excess of $500 per month
- a cost that can increase over time. We recommend that you
research a number of long-term care insurance policies with
the help of a qualified and trusted financial advisor as well
as trusted family members.
Veteran's Benefits: If you are a United States
Veteran, you qualify for medical care through a Veterans Affairs
medical facility (or referred to as a "VA Facility."
Unfortunately, there are often-times long waiting lists for
beds at VA Facilities, and VA-run long-term care facilities,
and priority is given to urgent conditions and service-related
health issues and injuries. To find our more about Veteran's
Benefits, we recommend that you visit the Veteran's Affairs
website at www.va.gov.
Medicare: Medicare is a big subject, and we'll
try to cover it to the best of our ability and knowledge, and
how it applies to assisted living and long-term care. Basically,
Medicare is a 'federal system of health insurance for people
over 65 years of age' and can, at times, help to cover certain
younger people with disabilities. Essentially, Medicare is broken
down into 2 parts that apply to assisted living (we won't go
into Part D, which relates to Rx coverage). Medicare
Part A is 'hospital insurance that helps cover inpatient
care in hospitals, skilled nursing facility, hospice, and home
health care.' Persons who are not eligible for premium-free
Part A may be able to purchase Part A if you meet a number of
criteria or conditions.
Part A Covers:
* Inpatient care in hospitals (such as critical access hospitals,
inpatient rehabilitation facilities, and long-term care hospitals)
* Inpatient care in a skilled nursing facility (not custodial
or long term care)
* Hospice care services
* Home health care services
* Inpatient care in a Religious Non medical Health Care Institution
As we understand it,
Part A will cover a portion of the costs for up to 100 days.
After 100 days, the patient pays for care. Medicare will not
cover: Anything that is not medically necessary (which, unfortunately
may include many of the services and amenities offered at many
assisted living facilities); private rooms (unless it is for
quarantine purposes, or is considered a medical necessity);
custodial care; and other extras such as internet access, television,
telephones, and any other non-medically necessary extras.
Medicare obviously is
designed to motivate patients to get better quickly, as care
is not ongoing.
Part B is available to individuals at an extra cost, and
is designed to cover 'cover medically-necessary services like
doctors' services, outpatient care, home health services, and
other medical services.'
Assisted Living Directory
is not qualified to be an expert on any aspect of Medicare.
Our intent here is to provide a very basic understanding of
what it covers. We recommend that if you wish to learn about
Medicare, and what it may or may not cover in relation to assisted
living and long-term care, to visit the Medicare Part A and
Medicare Part B pages on the Official U.S. Government site for
In addition, we found
a useful tool on the Medicare site that allows users to find
out if Medicare covers your 'Test,
Item or Service.'
Medicaid: Medicaid is designed to provide health
insurance to those individuals who require financial assistance,
and is paid for by federal and state funds. From the CMS website,
"Medicaid is available only to certain low-income individuals
and families who fit into an eligibility group that is recognized
by federal and state law."
As far as Medicaid and
Long-Term Care goes, it essentially pays for 'basic' nursing
home care with no unnecessary amenities, or extras. Medicaid
reimbursement rates are usually set by the state, and not by
the assisted living facility or nursing home - and these rates
are often set at a lower rate than what would be paid by other
insurance sources. This essentially means that unfortunately,
many assisted living facilities will not accept Medicaid patients,
since they are likely to make less money from them. Eligibility
for Medicated differs from state-to-state, but it is based on
the individual having minimal income and few other financial
resources and assets. To learn more about Medicaid, as well
as eligibility and an excellent overview of the program, please
visit the Centers for Medicare & Medicaid services site,
which is a division of the U.S. Department of Health and Human
Services, or call 800-MEDICARE.
Medigap Insurance: Medigap insurance is also
referred to as "Medicare Supplement" - which refers
to privately funded health care coverage and plans that are
'sold to Medicare beneficiaries in the United States that provide
coverage for medical expenses not or only partially covered
by Medicare.' There are a number of standard Medigap plans that
ranged from basic coverage to more comprehensive coverage and
service. To find out what the Medigap Basic Benefits are from
plans A through N, please visit the Medigap Basic Benefits page
on the Medicare site.
To find a Medigap Policy
in your City or Area, we recommend that you use the Medigap
Policy Search tool on the Medicare website.
We've briefly covered the most common ways that individuals
and families might pay for, or cover the costs of assisted living.
We did not cover secondary insurance, which may be insurance
from employers, or other groups that may cover seniors through
In the many years that
we have managed Assisted Living Directory, we've received countless
messages, and calls for help from families and individuals confused
about paying for assisted living, and how to cover the costs.
We've also witnessed the frustration experienced by assisted
living facilities having difficulty accepting new residents
who are unable to cover the costs of assisted living, or who
have incorrectly assumed that their insurance will cover part
of, or all of the costs.
We hope that any family
with aging loved ones, or individuals who may need assisted
living or long-term care in the future will take the time to
research all of the insurance options available, and what they
will or will not cover, and to talk to a trusted and qualified
financial advisor well before the services and care are actually
Good and thorough advance
planning is the only way to minimize, or eliminate any financial
surprises or frustrations as you prepare for retirement, and
the possibility of living in an assisted living or long-term
- Article by the
staff at Assisted Living Directory