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by Russell Noga | Updated December 10th, 2023
For many older adults and their families, the decision to transition into assisted living can be fraught with emotional and financial challenges. One of the most pressing concerns is, “Does Medicare pay for assisted living?”
In this article, we will shed light on the relationship between Medicare and assisted living, explore the real costs associated with assisted living, discuss alternative payment options, and delve into related care services covered by Medicare.
We aim to empower you with the knowledge needed to navigate the complexities of Medicare and make informed choices about assisted living for yourself or your loved ones.
Key Takeaways
- Original Medicare does not cover assisted living, but some services may be covered under specific conditions.
- Average cost of assisted living in the US is $4,500 per month with alternative payment options available including Medicaid and veterans benefits.
- Medicare provides coverage for related care services such as skilled nursing facilities and home health care depending on eligibility criteria.
Clarifying Medicare’s Stance on Assisted Living
You should know that Medicare does not shoulder the cost of staying in an assisted living facility or the non-medical aid offered in these communities. However, some medical services that are provided within assisted living facilities may be eligible for coverage under Medicare.
To fully grasp how Medicare interacts with assisted living, we need to scrutinize its various elements, namely Original Medicare (Parts A and B) and Medicare Advantage (Part C).
Original Medicare and Assisted Living
Original Medicare does not provide any financial assistance for assisted living expenses. This includes Parts A and B of Medicare.
However, it does provide coverage for eligible short-term stays in skilled nursing facilities and selected home healthcare services. Medicare Part A may provide limited coverage for a short-term stay in a skilled nursing facility following a hospitalization.
However, it does not cover the costs of residing in an assisted living facility.
Original Medicare will offer coverage for brief stays in skilled nursing facilities if certain conditions are met, including:
- Entering the skilled nursing facility within a limited period (commonly 30 days) of leaving the hospital
- Experiencing a qualifying hospital stay
- Receiving specialized care and therapy services on a daily basis
Medicare Advantage Plans and Assisted Living
Medicare Advantage (Part C) plans, offered by private insurance companies, do not cover assisted living costs either. However, certain Medicare Advantage plans may provide coverage for services comparable to those provided by assisted living facilities, including assistance with activities of daily living, meal delivery, and transportation to and from medical appointments.
So, does Medicare cover assisted living? The answer is no, but some services similar to those in assisted living facilities might be covered under specific Medicare Advantage plans.
Keep in mind that not all Medicare Advantage plans offer the same additional services related to assisted living. As such, it’s beneficial to compare different Medicare Advantage plans to identify the one that best fits your needs and preferences.
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The Real Costs of Assisted Living
The cost of assisted living can fluctuate based on the location, services, and amenities provided, with a typical assisted living cost of around $4,500 monthly. The typical cost of assisted living is $3,628 per month, with the median annual cost of assisted living care in the United States being $54,000.
To gain a better understanding of the factors influencing assisted living costs, we will explore regional differences and the impact of services and amenities on these costs.
Regional Differences in Assisted Living Costs
The cost of assisted living in the U.S. varies by state or region. Here are some examples:
- New Hampshire: $84,255 per year
- New Jersey: $76,800 per year
- Delaware: $72,414 per year
- Alaska: $72,000 per year
Additionally, the cost also varies by region within a state. Factors such as:
- location
- services and amenities
- building design
- market characteristics
- facility characteristics
contribute to the disparity in assisted living costs among different regions.
You should compare costs in various regions to make a well-considered decision about assisted living.
Services and Amenities Impacting Cost
The cost of assisted living is impacted by the services and amenities provided, such as personal care assistance, meals, and housekeeping.
Services and amenities included in assisted living costs may differ, but they are often comprised of rent for the apartment, three meals a day, health screening prior to occupancy (which may incur an additional fee), transportation services to medical offices or local points of interest, landscaping services, and an emergency medical alert system.
It’s vital to meticulously review the particular services and amenities offered by an assisted living facility and consider how these factors will affect the total cost of care.
Alternative Payment Options for Assisted Living
Given that Medicare doesn’t cover the costs of assisted living, exploring alternative payment options is necessary. These options may include:
- Medicaid
- Veterans benefits
- Long-term care insurance
- Life insurance
- A reverse mortgage
- An annuity
Each of these options has its own set of eligibility criteria and coverage limitations, so it is essential to carefully evaluate which option best suits your specific needs and circumstances.
Medicaid and Assisted Living
Medicaid, a government-funded health insurance program, may provide coverage for some costs associated with assisted living for eligible individuals. Coverage availability may differ by state, and generally, Medicaid will cover certain services for eligible seniors who reside in assisted living communities.
However, the cost of room and board is not covered in an assisted living community. Eligibility requirements typically involve demonstrating both functional and financial need.
It is important to note that Medicaid waivers do not cover the cost of room and board in an assisted living facility. To better understand Medicaid coverage and eligibility criteria, it is recommended to contact the relevant state’s Medicaid program.
Veterans Benefits for Assisted Living
Veterans benefits, such as Aid and attendance, can help eligible veterans and their spouses pay for assisted living costs. The average amount of Aid and Attendance benefits a veteran can receive for assisted living varies depending on their marital status.
For a single veteran, the average amount is $1,936 to $2,050 per month. For a married veteran, the average amount is $2,295 to $2,431 per month.
To apply for Aid and Attendance benefits for assisted living, veterans may:
- Fill out VA Form 21-2680 and mail it to the Pension Management Center
- Apply online through the U.S. Department of Veterans Affairs website
- Download the form and send it to the Pension Management Center.
Long-term Care Insurance
Long-term care insurance is a type of insurance that assists in covering the costs of long-term care services, such as assistance with daily activities, nursing care, and support for chronic illnesses or disabilities. These policies can help cover the costs of assisted living, but premiums and coverage vary.
The ordinary living cost of long-term care insurance can differ significantly, but for a 55-year-old, it can range from $1,700 to $2,207 per annum. When selecting a long-term care insurance policy, it is important to carefully review the specific terms and conditions to understand what is covered for assisted living.
Medicare Coverage for Related Care Services
Although Medicare doesn’t cover assisted living costs, it does cover some related care services under certain conditions. These services include skilled nursing facilities, home health care services, and hospice care.
Understanding these coverage options can help individuals and their families make informed decisions about care options and payment.
Skilled Nursing Facility Coverage
Medicare covers short-term stays in skilled nursing facilities for rehabilitation after a qualifying hospital stay. Coverage is limited to 100 days in a single benefit period and includes services such as:
- Daily care
- Skilled nursing care
- Rehabilitation services
- Physical therapy
- Occupational therapy
- Speech therapy
- Medications
- Medical supplies
- Necessary medical equipment
However, there are limitations and exclusions to Medicare coverage in skilled nursing facilities, such as requiring an initial hospital stay before covering skilled nursing facility care and not covering long-term care in nursing homes.
Home Health Care Services
Medicare covers medically necessary home health care services, including intermittent skilled nursing care, skilled therapy services, and care administered by a home health aide.
However, Medicare does not provide coverage for non-skilled personal care services, such as assistance with activities of daily living (ADLs) and 24-hour care at home.
After fulfilling the Part B deductible, Medicare covers 80% of the cost of covered home healthcare services.
Hospice Care Coverage![Does Medicare Pay for Assisted Living? Hospice Care Coverage](data:image/svg+xml;nitro-empty-id=NDk5OjYyOQ==-1;base64,PHN2ZyB2aWV3Qm94PSIwIDAgMzAwIDI1MSIgd2lkdGg9IjMwMCIgaGVpZ2h0PSIyNTEiIHhtbG5zPSJodHRwOi8vd3d3LnczLm9yZy8yMDAwL3N2ZyI+PC9zdmc+)
Hospice care is covered by Medicare for eligible individuals with a terminal illness and a life expectancy of six months or less. Medicare provides comprehensive coverage for those facing terminal illness, including:
- Drug costs to manage any symptoms or pain associated with the illness
- Medical and support services
- Respite care
- Grief counseling through hospice
In order to be qualified for Medicare’s hospice care coverage, one must be entitled to Medicare Part A, medically certified as terminally ill by a physician, and have a prognosis of 6 months or less to live.
Assisted Living for Dementia Patients and Medicare
For individuals with dementia, assisted living and memory care facilities can provide specialized care and support. Unfortunately, Medicare does not provide financial support for seniors with dementia who require assisted living or memory care.
These costs must often be covered by other sources. However, Medicare does cover some related care services for dementia patients, such as:
- Inpatient hospital care
- Part-time home healthcare
- End-of-life hospice care
- Necessary diagnostic tests
This section will cover the limitations of Medicare coverage for dementia care and the available special needs plans for individuals with dementia.
Limitations of Medicare Coverage for Dementia Care
The limitations of Medicare coverage for dementia care include the fact that it does not cover assisted living or memory care facilities. However, Medicare will provide reimbursement for up to 100 days of skilled nursing home care in certain conditions, but it does not cover custodial long-term nursing home care.
Medicare does cover some types of screening and medical care for people with dementia, yet with certain restrictions. Out-of-pocket costs for dementia care not covered by Medicare include long-term care expenses, such as assisted living facilities or nursing homes.
Medicare Special Needs Plans for Dementia Patients
Dementia patients may benefit from Medicare Special Needs Plans (SNPs), which are designed to provide tailored care for specific conditions. Individuals with dementia may be eligible for a Medicare SNP if they possess Medicare Part A and Medicare Part B coverage and are located within the plan’s service area.
The Medicare Advantage Value-Based Insurance Design (VBID) Model is a program that provides enrollees with chronic conditions, such as dementia, with additional benefits, reduced cost sharing, and more flexible plans from Medicare Advantage providers.
To apply for a Medicare Special Needs Plan if you have dementia, you can utilize the network finder on Medicare.gov and input the required information.
Navigating Medicare Enrollment and Plan Selection
While enrolling in and choosing a Medicare plan can be complex, comprehending the process and assessing available plan options is necessary to make the best choice for your needs.
This section will cover the enrollment process, which includes automatic enrollment for those receiving Social Security benefits, and the penalties for missing the enrollment period.
We will also provide guidance on how to evaluate Medicare plan options, considering individual medical needs, future health care expectations, and budget.
Enrolling in Medicare![Does Medicare Pay for Assisted Living? Enrolling in Medicare](data:image/svg+xml;nitro-empty-id=NTA3OjY3NA==-1;base64,PHN2ZyB2aWV3Qm94PSIwIDAgMzAwIDMwMCIgd2lkdGg9IjMwMCIgaGVpZ2h0PSIzMDAiIHhtbG5zPSJodHRwOi8vd3d3LnczLm9yZy8yMDAwL3N2ZyI+PC9zdmc+)
Enrolling in Medicare is automatic for those receiving Social Security benefits. For those who are not receiving Social Security benefits, they can still enroll in Medicare by contacting the Social Security Administration and submitting an application.
The optimal time to enroll in Medicare is during one’s Initial Enrollment Period (IEP), which spans seven months, beginning three months prior to the month in which one turns 65 and concluding three months after the month in which one turns 65.
It is important to note that there are penalties for late enrollment in Medicare, with penalties varying depending on the specific part of Medicare.
Evaluating Medicare Plan Options
In assessing Medicare plan options, consider factors such as:
- Current health condition
- Prescription drug coverage
- Preferred doctors and healthcare providers
- Budget
- Additional benefits
- Preventive care coverage, including doctor visits
- Any specific healthcare needs or conditions
Future health care expectations also play a significant role in selecting a Medicare plan, as individuals contemplate the potential alterations and fluctuations in the federal health insurance program, as well as the availability of supplemental coverage and benefits.
By taking into consideration these factors and thoroughly researching available plans, individuals can make informed decisions about which Medicare plan best accommodates their needs.
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Summary
In conclusion, while Medicare does not cover the costs of assisted living, it does provide coverage for some related care services, such as skilled nursing facilities, home health care services, and hospice care, under specific circumstances.
Understanding the limitations of Medicare coverage and exploring alternative payment options, such as Medicaid, veterans benefits, and long-term care insurance, can help individuals and their families make informed decisions about care options and payment.
Navigating Medicare enrollment and plan selection involves understanding the enrollment process and evaluating available plan options to find the best plan for your needs.
With this knowledge, you can confidently approach the complexities of Medicare and make informed choices about assisted living for yourself or your loved ones.
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Frequently Asked Questions
How is most assisted living care usually paid for?
Most assisted living care is usually paid for with private funds, such as personal savings, pension payments or retirement accounts. Family members often contribute to these costs in addition to seniors saving for their retirement over the years.
What happens to senior citizens when they run out of money?
Seniors who have no money and cannot turn to family for support may become wards of the state if they develop a health emergency. Those residing in an assisted living facility will be evicted if they run out of funds.
Does Medicare pay for assisted living in Massachusetts?
No, Medicare does not cover assisted living in Massachusetts, but other insurance programs such as Long Term Care Insurance and the Veteran’s Aid and Attendance Benefit may be available. Additionally, the state’s Group Adult Foster Care Program through Medicaid may help with some of the costs.
Does medical pay for assisted living in California?
Yes, Medi-Cal in California does provide coverage for assisted living through the Assisted Living Waiver (ALW) program.
What services does Medicare cover in skilled nursing facilities?
Medicare covers a range of services for short-term stays in skilled nursing facilities, such as daily care, skilled nursing care, rehabilitation services, physical therapy, occupational therapy, speech therapy, medications, medical supplies and necessary medical equipment.
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Russell Noga is the CEO and Medicare editor of Medisupps.com. His 15 years of experience in the Medicare insurance market includes being a licensed Medicare insurance broker in all 50 states. He is frequently featured as a featured as a keynote Medicare event speaker, has authored hundreds of Medicare content pages, and hosts the very popular Medisupps.com Medicare Youtube channel. His expertise includes Medicare, Medigap insurance, Medicare Advantage plans, and Medicare Part D.