Medicare and Medicaid Coverage for Assisted Living: Everything You Need to Know
We may earn a commission if you make a purchase through one of our links. McClatchy newsrooms were not involved in the creation of this content.
When you start looking for an assisted living community for yourself or a loved one, it’s easy to feel overwhelmed – fast. This is especially true when you’re looking for ways to pay for the monthly care costs. According to the Genworth 2021 Cost of Care Survey, assisted living in the United States costs an average of $4,500 a month, which is a lot for many seniors trying to get by on a fixed income.
Medicare and Medicaid help with medical costs for huge numbers of people. Nearly 64 million Americans are enrolled in at least one part of Medicare, another 83 million are at least eligible for Medicaid, and over 12 million seniors are enrolled in both.
This article provides an overview of Medicare and Medicaid for older adults who may need help paying for assisted living. It gives an overview of both programs and describes how they work together to help seniors. There are also a lot of helpful tips about the exceptions you and your family could use to get help with assisted living, along with information about fee waivers and special programs that might be available in your state.
Understanding Medicare and Medicaid
Medicare and Medicaid are easy to mix up sometimes. Both are government-sponsored health insurance programs for some Americans, but they typically serve different groups and provide somewhat different benefits. Maybe the biggest difference is in how they’re organized and what it means for you as a beneficiary.
What is Medicare?
Medicare is the federal health coverage program for seniors and certain other qualifying adults. The program is entirely funded by the federal government, and you can get your benefits in two forms: Original Medicare and Medicare Advantage. These are just different ways to get your benefits, and both have the same eligibility standards and coverage rules.
Original Medicare is broken down into three parts: Part A, B and D. Seniors are automatically enrolled in Part A on turning 65 with no monthly premium. This picks up most of the cost of hospital stays. Part B is the outpatient benefit that picks up much of the cost of medically necessary services outside the hospital. Part D is the prescription drug benefit for medicines you pick up from the pharmacy.
Medicare Advantage, sometimes called Part C, is a different kind of plan. Part C plans include 100% of the benefits as Parts A and B, except they’re rolled together in one plan. Depending on your chosen plan, your Part C could also include prescription coverage and dental and vision benefits.
Who qualifies?
You can get Medicare if you are:
A U.S. citizen or permanent legal resident AND
At least 65 years old OR
An adult experiencing kidney failure or another qualifying condition
What is Medicaid?
Medicaid is the combined state-federal health insurance program for low-income and medically needy people. Every state has its own Medicaid program, which may have its own special rules for how it works. Medicaid is required to pay for medical services and equipment your doctor deems medically necessary.
Who qualifies?
You can enroll in Medicaid in most states if you are:
A U.S. citizen or permanent legal resident AND
Earning less than your state’s maximum income for benefits OR
In dire medical need of basic health care and can show you’re otherwise unable to pay
Medicare Coverage for Assisted Living
Medicare generally doesn’t pay for the nonmedical services you get in assisted living. You’re not totally out of luck, however, since many services are included in most Medicare plans.
Medicare Part A coverage
Medicare Part A is the inpatient hospital benefit for qualifying seniors. This part of Medicare pays for the care you get in medical facilities you stay in for more than a few days. Facilities where your Part A benefits might apply include:
Hospitals
Nursing homes
Hospice centers
Home health care in your own residence
Medicare Part B coverage
Medicare Part B covers outpatient services and preventive care. Outpatient clinics, transportation to and from medical appointments and medical supplies are all covered by Part B benefits.
Medicare Advantage plans
Medicare Advantage offers several plans that have extra benefits in them. Some of these benefits bear directly on assisted living costs. Because myriad private companies issue Part C plans, you have to ask your plan rep for details about what your individual Medicare Advantage plan pays for.
Medicaid Coverage for Assisted Living
Medicaid pays up to 100% of the cost for medically necessary services, products and drugs. It doesn’t directly pay for non-medical care services, such as those provided by caregivers. Some people may be able to obtain a waiver for assisted living.
Requirements vary by state, but you might qualify for an assisted living waiver if you:
Are enrolled in Medicaid
Have a condition that would justify admission to a nursing home, but
Be willing to accept placement in assisted living as a less-expensive alternative
Combining Medicare and Medicaid for Assisted Living Costs
More than 12 million Americans are eligible for both Medicare and Medicaid. Dual-eligible seniors can lean on their Medicare benefits for most of their medical expenses, with Medicaid stepping in to handle remaining out-of-pocket costs. Medicare savings programs can also help to save up for care costs. Finally, you might qualify for a special needs plan (SNP) that limits coverage in most areas in exchange for heightened coverage in a particular field, such as renal care.
Additional Resources and Support
You don’t have to manage the transition to assisted living on your own. Several resources in every state can help you get the care you need.
State health insurance assistance programs (SHIPs): SHIPs provide unbiased, one-on-one advice that helps seniors understand their health care options and navigate Medicare.
Eldercare Locator: The Eldercare Locator helps seniors by providing free information and impartial advice about senior care, including assisted living. Advice is also available about health insurance, abuse and neglect matters and transportation services in your area.
Aging and Disability Resource Centers (ADRCs): ADRCs are private nonprofits that have a wealth of information, referrals and other resources to support seniors. Your local ADRC can probably help you with case manager services and expert advice about your senior living options.
The Bottom Line
Medicare and Medicaid can both be great resources for helping seniors get the health services they need. If you need assisted living, these may not be the best way to pay for your care. Learn more about Medicare before moving into an assisted living community, and be prepared for the costs and services you need.
Daniel Cobb began his career as a freelance writer over 10 years ago writing for websites such as TheSimpleDollar.com and Reviews.com. Since then, he has specialized in writing, editing, and managing the content team for Caring.com and other senior living websites. Over the last five years, he’s developed a deep understanding of the senior living industry and has enjoyed creating exceptional content that reaches millions of visitors every month. He can be reached at editorial@caring.com.
