How to Pay for Assisted Living

Timestamps:
0:00 Ryan Molloy and Amie Clark introduction
0:20 What is assisted living?
1:12 How much does assisted living cost?
2:01 How much does assisted living cost for couples?
4:36 Why have assisted living costs increased over 70% since 2004?
7:26 Does Medicare cover assisted living?
7:53 Does Medicaid cover assisted living?
8:22 Does the VA pay for assisted living?
9:15 Is assisted living tax deductible? (The short answer is yes)
11:00 How do most people pay for assisted living?
11:57 What happens if you run out of money in assisted living?
12:43 What are some tips for affording assisted living?
13:46 If someone is concerned about running out of money, make sure to understand if a community has a Medicaid contract.
15:11 Smaller units are more affordable than larger ones in assisted living.
15:57 Apartment sharing may be a good solution to lowering the cost of the room.
16:23 Make sure you understand the fees associated with move-in - these may be negotiable.
17:44 If you already living in assisted living, make sure to pay attention to the monthly bill, stay in communication with upper management about any financial concerns.

Assisted living is a form of senior housing that allows older adults to be as independent as possible while receiving supportive services. In assisted living, residents can expect to have their own apartment setting, studio, one-bedroom, or two bedrooms. People who live in assisted living are generally active and enjoy communal activities such as dining and socializing.

In 2020, the median cost of assisted living in the US was $4300 per month. Depending on your location, costs can range from $3500 to $7000 per month.

The cost of assisted living is a combination of room and board (which will vary based on the size and location of the apartment), care needs of the resident and the services required to meet those needs, and in some cases additional amenities offered.

How much does assisted living cost for a couple? It really depends on the assisted living facility and how they calculate charges. Starting with room and board, then additional services each spouse needs. Each person will have their own plan of care and will be charged individually. From Amie's experience, you can expect a two-bedroom apartment to cost anywhere from $4000 to $6000 just for the room.

According to Genworth’s Cost of Care Survey, assisted living costs have increased over 70% since 2004. This can be attributed to caregiving shortages, higher acuity of the residents, and increased numbers of people with Alzheimer’s and dementia. In 2020, costs also rose specifically due to COVID- with PPE costs, regulatory changes, and supply and demand issues.

Medicare does not cover assisted living. Medicaid does cover assisted living. The VA may cover some of the costs of assisted living through the Aid and Attendance program.

Some or all of the costs of assisted living may be tax-deductible as a medical expense. Medical expenses, including some long-term care expenses, are deductible if the expenses are more than 7.5 percent of your adjusted gross income.

Most people pay for assisted living out of pocket with their own money unless they simply do not have the resources to do so. In that case, Medicaid would pay. If people have invested in a long-term care insurance policy, then their policy will pay based on their specific policy.

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[MSFROST]

Amazing information. Thank you for this. It's shocking how much it cost to take care of loved ones in long term care. It so important to prepare when your younger and have the financial means to take care of yourself when you are older.

[YinYangDPW]

I knew a guy who purchased "long term care insurance" - very expensive - - when he tried to use it, turned out there was a clause in the contract that said if the policy holder could bathe them selves, the policy would not pay - he never got a dime out of all the premiums he paid.

If one can qualify, getting into a government subsidized low income apartment with home health care is far cheaper than "assisted living".

In Kansas, I don't think Medicaid pays for assisted living, I guess it varies state to state.

[cherylcampbell]

I bought long term insurance 20 years ago. Buy it when your healthy. It’s an insurance policy that grows. Very necessary unless you want the state to take care of you 3 hours a day few days a week. Not good if you have dementia.

[thebeautifullibra]

Who can afford this and what did they do for a living? What investments did they make?

[PeggyFosterExecCoach]

Most helpful and on topic info almost at end of presentation.

[reneegibson]

I'm an administrator of an assisted living in PA and our most expensive room is $4000.

[ThriftyPharmD]

My mom pays for memory care $6400/mo for assisted living. Ridiculous because my mom really doesn't have the money! We had to sell her house and use that for a few years to pay for it. She has Medicare and Medicaid and neither pays one penny!! Unless it's a low horrible care nursing home.

[ultimatecouponlady]

Excellent information. Thank you so much.

[johnkelly]

National Aide Veterans and Families (NAVF) to see the dates of veterans of War and help for their spouses too. They can help you fill out paperwork because if you get one thing wrong, you can be rejected and veterans and their spouses think they do not qualify for the help they are due and available for them. Non profit help. They understand the separate veterans dept to call as the different departments do not talk between theirselves when you call Va for help. Thank you Veterans!

[shamaro]

Thank you so much. Where are you located?

[jhlfsc]

She completely leaves out the #1 reason for a 70% increase since 2004 which is venture capitalism that allows unregulated entities to buy up everything in the market, creating monopolies in pockets of the country that charge pretty much whatever they want with zero competition, even from the state.

[SandfordSmythe]

"Assisted living" can have several meanings.

[GlennCrinerLA]

Who pays for them to stay? Is it out of there pocket or do there state pay? Or do u bill there insurance

[cherylmatthews]

We need federal regulations over ALF programs across the nation...too much potential for aggressive exploitation of our seniors. For example, senior requests services and the ALF claims staffing shortages and months go by while not having the expected program supports in place ...maybe true, but seniors consider ALF programs expecting the services to be available, as needed...too much subjective oversight where greed can run wild!

[ninavongunten]

If you are a homeowner and don't want to go into Assistant Living or a Nursing Home, consider a Reverse Mortgage in order to pay for home care. In most cases you are better off in your own home, if possible. I know because I have been through this with several family members whom I helped take care of in their final years. Many of the Assistant Living Homes and Nursing Homes in this country are an absolute disgrace! I would to see the Federal Government take over the funding and operation of these homes. In today's world it is all about the young people. They seem to forget about the older generation who worked most of their lives and paid plenty of taxes during their lifetime and deserve much better from society.

[copblocker]

thanks for the info, i guess most of us will die in the streets

[ungarlinski]

This is false information. Medicaid does not pay for an ALF; it only pays for the medical component of it. It doesn't pay for the base fees or room and board, which is of course the most expensive component.

[ccleland]

I'm a CFP specializing LTC and Medicaid....Medicaid WILL NIOT pay for assisted living in CT. Not tax-deductible! Not room and board!

[jaycee]

Seriously?!? Not in my area. I pay $11, 590.00 a month. It’s a disgrace.

[sasunshine]

This doesn’t really tell you how to pay for assisted-living! Other than be sure you have the money saved! Very misleading although maybe two pointers that could be helpful if you could afford it in the first place.