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Does Medicaid Pay For Assisted Living?

Does Medicaid Pay For Assisted Living?

As our loved ones get older, their needs change and they require assistance getting around and some daily activities. However, paying for assisted living can be very expensive and many seniors can not afford it. 

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Since many low income seniors and people with disabilities qualify for Medicaid the question, “Does Medicaid pay for assisted living?” comes up often. 

In this post, you’ll learn if Medicaid covers assisted living, the extent of that coverage, and the eligibility requirements.

Key Takeaways

  • Yes, Medicaid will pay for assisted living in some states but it usually won’t pay for room and board.
  • In states where regular Medicaid doesn’t cover assisted living, residents can opt for Medicaid waivers like Home and Community-Based Services (HCBS) and 1115 Demonstration Waivers.
  • Waivers are not entitlements. Hence, eligibility does not automatically equal enrollment.
  • How much Medicaid will pay for assisted living depends on the state policy and the individual’s income.
  • Other options that fund assisted living costs include Veteran Pensions and long-term care insurance.

Does Medicaid Pay for Assisted Living?

Yes, Medicaid pays for assisted living in some states. In fact, our founder Nicole has a relative who lives in an assisted living facility paid for by Medicaid so we know that it’s possible.

However, it’s not so straightforward. Like so many government programs, the terms and guidelines surrounding assisted living coverage differ depending on the state. 

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Both the federal and state governments fund Medicaid. The federal government has guidelines that control Medicaid eligibility and allocation. However, each state still has a level of freedom in determining eligibility and in the disbursement of funds. 

In the case of assisted living, the federal government doesn’t allow Medicaid to pay for room and board. However, Medicaid can cover some costs associated with assisted living.

The assisted living costs covered by Medicaid also vary across states. Examples of assisted living costs covered by Medicaid across states include;

  • Personal care services
  • On-site therapy
  • Medication management
  • Homemaker services 
  • Transportation
  • Case management
  • Recreational activities
  • Personal emergency response systems

Some states might cover assisted living costs in their regular Medicaid. Those who don’t offer this coverage in regular Medicaid usually have Medicaid Waivers to make up for it.  

States use Medicaid Waivers as alternatives to federal Medicaid rules. By implementing waivers, they can expand the eligibility requirements of regular Medicaid to cover more people. They also reduce costs by offering services that regular Medicaid would not cover.  

The most common Medicaid waiver that covers assisted living costs is the 1915c Medicaid HCBS Waiver (Home and Community-Based Services).  Other waivers that cover assisted living costs include 1115 Demonstration waivers, and 1915b Managed Care Waivers. 

Note that, unlike regular Medicaid programs, waivers are not an entitlement. Hence, eligibility does not automatically equate to enrollment. 

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Most waivers have a limited number of available slots. The number of people that can be enrolled per time is strictly regulated hence long waitlists are very common. 

Another noteworthy point is that assisted living is referred to with different names across different states. Some states might refer to it as supported living, adult foster care, residential care, etc.  

How Much Will Medicaid Pay For Assisted Living?

It’s difficult to give a specific figure for this question because the amount Medicaid pays depends on several factors. 

Depending on the state’s policies and the individual’s income level, Medicaid may demand that the senior covers some percentage of the cost while they cover the rest. 

The first factor to consider is the state the senior resides in. Medicaid funding policies differ per state.

Some states impose charges like coinsurance, co-payment, and deductibles for non-emergency situations depending on the individual’s income. The individual’s income will determine how much of the cost Medicaid will foot. 

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Another factor that determines how much Medicaid will pay for assisted living is the program the senior is enrolled in. Many states offer assisted living coverage via waivers. While these waivers have flexible eligibility requirements, the individual in question must fall below a certain income level or demonstrate that the level of care they need cannot be funded with their income. 

Lastly, how much Medicaid pays for assisted living will depend on the level of care the senior needs. Usually, seniors with more critical needs are eligible for broader coverage. The amount of care they need will significantly influence the assisted living services Medicaid will cover, which in turn affects how much Medicaid will pay. 

Who Is Eligible For Medicaid Assisted Living?

To be eligible to apply for Medicaid assisted living, a senior or person with a disability must meet strict requirements including:

  • Must be a resident of the state you’re applying for assistance.
  • Must be willing to reside in an assisted living facility that’s licensed by the state and accepts Medicaid.
  •  Must meet the state’s Medicaid income and assets requirements.
  • Must meet the state’s functional requirements. In most states, they must need help performing at least two activities of daily living.

Other Options That Fund Assisted Living

If your loved one is not eligible for Medicaid or Medicaid Waivers in your state, you can consider any of the following options. 

Veteran Benefits

The US Department of Veteran Affairs provides Aid and Attendance benefits to qualified veterans and their spouses. This Aid and Attendance benefit can be used to offset or cover the cost of assisted living. 

With the Aids and Attendance benefit, qualified persons can receive anything from $1,999 to $2,200 to pay for care in any state-licensed facility. 

To be eligible, the individual must meet specific medical and financial requirements. 

On the financial side of the coin, their income must not surpass a certain threshold. This eligibility criterion is a little complex because the VA exempts some assets, like certain annuities and prepaid funeral expenses when considering financial eligibility.  

You’ll need to discuss with a VA-accredited attorney for a better understanding of the financial qualifications and requirements.  

To be medically eligible for the Aid and Attendance benefit, your loved one must require assistance with at least two activities of daily living (ADLs). 

Activities of daily living are the basic self-care actions individuals carry out. These include bathing, dressing, walking, using the bathroom, eating, and mobility (getting in and out of the chair or bed). If your loved one is struggling to carry out at least two of these activities, they might be eligible for the Veterans benefits. 

This information can be a lot to digest. The eligibility requirements may seem overwhelming and a bit confusing. 

For a better understanding, you should speak to an expert at your local VA office or consult a Veterans Benefits Advisor. You can also find more information on the Veterans Pension Benefit with Aid and Assistance on the VA website. 

Long-Term Care Insurance

Many long-term insurance policies cover at least some part of assisted living costs. They may also cover:

  • Respite care
  • Adult daycare
  • Nursing home care
  • Memory care
  • Home Care 
  • Hospice care

Please note that your insurance coverage may differ depending on your loved one’s broker. You should contact their broker for a better understanding of the terms of your loved one’s insurance policy. 

FAQs about Medicaid & Assisted Living

This is a complex topic that is very important to many families, so it’s understandable why you may have questions.

How Do I Find Assisted Living That Accepts Medicaid?

In most states, there are only a handful of Medicaid-certified assisted living facilities, and usually, the approved facilities have limited slots.

Assisted living facilities also go by different names across different states. Some states refer to it as residential care group homes, others may call it board and care homes, personal care homes, or memory facilities.

Unfortunately, there’s no centralized database of assisted living facilities that accept Medicaid. And even though some states do have something of this sort, it’s often not updated with current information. 

To find one, it’s advisable to do the research yourself. Start by reaching out to all the assisted living facilities around you. When consulting them, ensure you ask them if they accept Medicaid and if they have any Medicaid allocations left. 

Another way to find one around you is to contact your local Area Agency on Aging. They could provide you with useful information on Medicaid assisted living facilities.

Will Medicaid Pay For Room And Board?

Medicaid will not usually pay for room and board. However, many states have programs and measures to help residents with this cost.

Some states have policies that limit how much-assisted care facilities can charge for room and board. Other states have programs where they assist seniors with room and board by supplementing their SSI.

Relief Recap

Medicaid can cover assisted living costs. However, the answer isn’t so straightforward. The state-dependent policies and different Medicaid programs can make navigating the Medicaid landscape complex. Mistakes are common and can incur unnecessary out-of-pocket costs. It’s best to seek counsel from the appropriate professionals and counselors to avoid making costly mistakes.