04 Feb Senior Care Costs: What is Covered?
According to Genworth’s 2019 Cost of Care Survey, the national median cost of assisted living is over $4,000 per month. While these costs can vary depending on multiple factors like location, services, room type, and amenities, it’s not uncommon for individuals to pay anywhere between $30,000 and $70,000 in annual senior living costs. At any price and regardless of their socioeconomic status, the cost of senior living is often a shock for most older adults, no matter how well they’ve planned and budgeted.
Many families strategize to cover the costs of senior living through a combination of private funds that include things like:
- Social security benefits
- Pension payments
- Retirements accounts
The problem? Sometimes, this planning still falls short. And just as many industrious Americans spend their lives working and saving for retirement, but because of other factors and extenuating circumstances, they can’t fully fund assisted living on their own. The search for affordable senior housing and the means to pay for it isn’t always clear. The good news is that there are some government programs that individuals can use to help pay for medical care and/or assisted living. But what is truly covered in these programs?
Medicare and Long-Term Care
Medicare is the federal health insurance program that’s designed for people age 65 and older, as well as some younger people who have disabilities. In the same way that most other health insurance companies do not cover the cost of long-term care services, Medicare does not pay for the cost of room and board or personal care in any type of assisted living community.
In fact, Medicare does not cover any of the costs of assisted living—with a few notable exceptions. Under a Medicare plan, individuals are covered for medical costs incurred while a senior is in assisted living. The only other exception? Some Medicare Advantage plans may pay for personal care assistance for persons who reside in assisted living because they need memory care, as granted under Medicare Part C.
Medicaid and Senior Living Facilities
Medicaid is often mistaken for Medicare, but there are differences between the two programs. While Medicare is mainly for seniors over the age of 65, Medicaid is a joint program between the federal and state governments that’s designed to help those with low income and limited assets to find ways to cover the costs of healthcare services, including long-term care.
Medicaid assistance for assisted living and senior care communities varies by state since Medicaid is funded jointly by both the federal government and state governments. While the federal government sets guidelines for how each state needs to spend its Medicaid dollars, each state is given leeway to set its own policies within these guidelines, which is why Medicaid coverage for senior care communities is different from one state to the next.
Many states offer long-term care to Medicaid beneficiaries or some level of financial support with the cost of assisted living, either through Medicaid or Medicaid waivers. One important consideration? In assisted living communities, Medicaid doesn’t cover the cost of basic room and board the way it does for nursing home residents who need more intensive care.
Medicaid Coverage in Colorado
Medicaid for long-term care has different resource rules in place than other programs in Colorado. The state’s Medicaid program, Health First Colorado has its own set of guidelines for long-term senior care. Under Health First Colorado, all resources are considered assets, including:
- Real estate property
- Personal property
- Life insurance with a cash value
- Vehicles including boats and motorhomes
- Bank accounts
For Medicaid assistance with the cost of senior living, Colorado residents must total up all of their assets to determine how much you have in available resources. Colorado law dictates that a single person can only have up to $2,000 in assets, with a few exclusions like your car and home, up to a value of $589,000. For married individuals, a non-applicant spouse can retain as much as $126,420 in joint assets. Therefore, Medicaid is for those Seniors who have limited Resources and only certain Assisted Living Communities are built to take Medicaid residents. You must check with the facility to see if they accept Medicaid.
Medicaid and the Cost of Senior Living: What is Included?
While it’s true that under Medicaid, no state can pay for room and board costs in assisted living, states have other means by which they can control these costs. These strategies include:
- Capping the amount assisted living residences can charge
- Offering Supplemental Social Security assistant to Medicaid-eligible residents to cover assisted living room and board
- Paying for meal preparation and serving without covering actual food costs
VA Benefits to Pay for Assisted Living
The U.S Department of Veterans Affairs (VA) offer pension funds to eligible wartime veterans and their surviving spouses who have limited income levels and assets. This is an increase from the regular monthly pension, but many veterans and their families don’t know about this higher pension. For veterans and their surviving spouses who require assistance in the performance of daily activities, funding is available to pay for things like tasks of daily living.
Long-Term Care Insurance
Sometimes, these programs just aren’t enough, and in many instances, there’s not much that they cover. This is where long-term care insurance comes into play. Many of these insurance policies cover expenses at accredited assisted living communities, and depending on each policy, many assisted living communities may be covered by long-term care insurance.
Premiums for long-term insurance varies greatly depending on location and how much coverage individuals choose. This insurance is flexible based on the kind of care seniors need, including assisted living, nursing homes, and adult daycares. Because long-term care insurance is privately-funded, what’s covered differs from plan to plan and provider to provider. It’s important to ensure your community of choice is covered by your long-term care insurance.
Golden Lodge is the area’s newest senior assisted living community, but we’re so much more than that. Our responsibility is to our residents and their families, to ensure they are comfortable and safe, and that they feel valued. If you are considering assisted living for yourself or a loved one but are worried about how you might pay for it, let’s talk. To learn more about our senior living community, contact us today to schedule a virtual or in person tour.