Assisted Living: Types, Costs, and Medicare Coverage

What Is Assisted Living?

Assisted living facilities can provide a level of independence for people who need help with activities but don’t require the medical or care services provided by more advanced care facilities. Medicare does not cover assisted living costs, however, long-term care insurance will.

Terry Turner, writer and researcher for RetireGuide

What Is Assisted Living for Seniors?

Assisted living is a form of eldercare that aids older people who need help with daily care but still don’t need as much help as a nursing home would provide.

The care that is provided in assisted living facilities may serve as few as 25 people or more than 120. Assisted living facilities typically provide different levels of care. The higher the level, the higher the price for care.

Residents in assisted living facilities have their own rooms or apartments within the facility. Facilities also have common areas where you can socialize with other residents, offering normalcy through retirement life.

Assisted living facilities are one of several senior living arrangements that help care for people as they age.

What Does Assisted Living Provide?

Assisted living facilities provide services for people who need help with activities of daily living and who may no longer be able to live independently.

  • Assistance with personal care
  • Help with medications
  • Housekeeping
  • Laundry
  • On-site staff
  • Recreation activities
  • Around-the-clock supervision
  • Security
  • Social activities
  • Three meals a day

Other Types of Eldercare

Assisted living is one of the many types of eldercare. Some types of eldercare provide services in facilities like assisted living does, others may provide care within the home.

Convalescent homesSometimes called an inpatient rehabilitation facility, convalescent homes maintain medically trained staff who provide short-term care. These facilities help people recover from surgery, injuries or sickness until they can return to life as usual.
Home careHome care is limited to custodial or unskilled care in the home by helping with daily living tasks, such as bathing, dressing, laundry, cleaning and running errands. Home care differs from home health care, which requires medically trained assistance in the home.
HospiceHospice care provides comfort care for the terminally ill and their family members. It can be provided to patients once their doctor determines they have six months or less to live. Hospice may also include palliative care and can typically be provided in medical facilities or in the patient’s home.
Memory careLike assisted living, memory care is provided in facilities with 24-hour supervision and personal care. However, memory care is provided only to people with dementia, and the staff has special training in caring for people with different types of dementia. Patients may have Alzheimer’s, Parkinsons, Huntington’s or other types of dementia that require around-the-clock supervision and care.
Nursing homesA nursing home may also be called a skilled nursing facility (SNF). Nursing homes typically focus on medical care more than assisted living facilities do. Nursing homes provide nursing care, around-the-clock supervision, three meals a day and assistance with everyday activities.

How Much Does Assisted Living Cost?

The median cost of staying in an assisted living facility was $4,500 per person, per month in 2022, according to Genworth’s Cost of Care Survey.

But the cost can vary widely depending on which state — or city — you live in. For example, the Genworth survey found that the median monthly cost for assisted living care was $3,500 in Mississippi compared to $5,250 in California.

The median cost for New York was $4,580 per month, but for the New York City area specifically, it was nearly $6,000.

Assisted living is also a great option cost-wise for couples. While it can be expensive per person, it’s not double the price for two people living in the same unit. Typically, you would only need to pay for the second person’s medical assistance, meals and other miscellaneous expenses.

Does Medicare or Medicaid Cover Assisted Living?

Original Medicare — Medicare Part A and Part B — does not cover assisted living or any other type of long-term care. But it will cover the health services your Medicare coverage typically covers if you are in an assisted living facility.

Medigap — also known as Medicare Supplement insurance — helps pay for Medicare-covered services and items, so it cannot be used to pay for assisted living.

Most Medicare Advantage plans do not cover assisted living facilities. Check with your plan administrator to see if your specific plan does.

Medicaid may help pay for certain assisted living costs — but it does not pay for room and board. You must be eligible for Medicaid, meaning, you have exhausted your financial resources and have a low income.

Because Medicaid is a joint state and federal program, the rules for covering assisted living vary by state and some states may not cover assisted living.

How to Pay for Assisted Living

In most cases, you will have to pay for all the costs associated with assisted living care. But there are some other options you may be able to consider.

Annuity paymentsIf you are receiving annuity payments, you can use them to pay for your assisted living costs.
Long-term care insuranceLong-term care insurance — or a life insurance policy with a long-term care rider — can be used to pay for assisted living facilities and other long-term care needs. These are insurance products purchased from private insurers.
Reverse mortgageIf you own your home outright or have only a small mortgage left to pay off, you may consider a reverse mortgage to pay for assisted living. You convert some or all the equity in your home into cash payments, while retaining ownership of your home. You can then use the payments you receive to pay for assisted living.
VA benefitsIf you qualify for a military pension, you may be eligible for the Aid and Attendance benefit from the Department of Veterans Affairs. This is an increase in the monthly pension to veterans or surviving spouses who require assistance of another person for daily activities. These may be applied toward assisted living costs.

You may also check with your local Area Agency on Aging about free counseling services, benefits and information about Medicaid eligibility and benefits in your area that may help you pay for an assisted living facility.

Who Qualifies for Assisted Living?

To be eligible for assisted living in most states, you typically need daily assistance with at least two activities associated with daily living.

  • Bathing
  • Getting dressed
  • Going to the bathroom
  • Grooming (shaving, brushing teeth, etc.)
  • Making meals
  • Rising out of bed
  • Standing up or sitting down
  • Walking

You typically don’t qualify for assisted living if you are bedridden or need memory care, major medical care or continuous supervision.

People with those qualities should consider skilled nursing facilities or other facilities for their specific conditions and needs, which would not be served in an assisted living facility.

Frequently Asked Questions About Assisted Living

When to move from assisted living to a nursing home?
You need to move to a nursing home when your assisted living facility can no longer provide the level of care you need. Nursing homes provide complex medical and rehabilitation services that assisted living facilities may not. Sometimes the assisted living facility will make this decision when it determines that you need more care than it can provide.
How can you pay for assisted living with limited resources?
Medicaid may cover your costs for assisted living care if you have limited resources and meet Medicaid eligibility requirements. But you typically must exhaust your financial resources and have very limited income to qualify.
Who qualifies for VA Benefits for assisted living?
The U.S. Department of Veterans Affairs (VA) will provide you with additional monthly payments to help pay for assisted living so long as you are eligible for VA benefits and require the aid and attendance of another person for everyday tasks such as bathing and dressing. The payments are part of the VA Aid and Attendance program.

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