How to Pay for Assisted Living
More than half of today’s adults will need some form of long-term care after turning 65. We’re living longer than ever, and those extra years often bring a greater need for support — from help with meals or managing medications to more advanced care, which could add up to hundreds of thousands of dollars.
However, more than half of adults over 50 believe it is unlikely they will ever need long-term care, and 45% said their need for long-term care seems too distant to make plans for it. When you consider the average cost for assisted living in Connecticut is $6,480, or $77,760 annually, the time to start planning is now. It isn’t only about covering the costs; it’s about creating peace of mind for you and the people you love.
Here is a look at some of your options.
What About Medicare?
Medicare is an excellent benefit for millions of seniors who require skilled nursing care following surgery or an injury. However, it’s essential to recognize that Medicare only covers medically necessary care. That means doctors, hospitals, drugs and short-term rehabilitation after hospitalization. Original Medicare (Parts A and B) doesn’t cover the cost of assisted living, since it isn’t considered medically necessary. However, under Part A — your hospital insurance — Medicare will cover eligible short-term stays in a skilled nursing neighborhood after an inpatient hospital stay, provided they occur within each benefit period.
After the first 20 days, a $209.50 daily coinsurance applies in 2025, and any days beyond 100 are entirely out of pocket. Original Medicare also helps cover certain home health care services and hospice care.
Can Medicaid Help?
Medicaid is a joint federal and state program that helps cover healthcare costs for people with limited income. For seniors, it can also help cover certain long-term care services, including support provided in assisted living or skilled nursing settings.
Medicate doesn’t cover the room and board costs of assisted living. Still, many states offer programs that can defray other expenses, such as medication management, on-site therapy and support services. These programs can make assisted living more affordable for those who qualify.
In many states, Medicaid’s Home and Community-Based Services (HCBS) Waivers or Aged, Blind, and Disabled (ABD) Medicaid may help cover care in assisted living. The details vary by state, from eligibility to what’s covered, so it’s essential to check your state’s guidelines to determine the available options.
Are You a Veteran or Surviving Spouse?
Wartime veterans and their surviving spouses, age 65 and older, may qualify for a tax-free benefit called Aid and Attendance through the Department of Veterans Affairs. This benefit helps offset the cost of long-term care for individuals who require assistance with daily activities, such as bathing, dressing, eating, toileting, or transferring from one place to another.
The benefit pays up to $2,795 monthly or $33,548 annually for married veterans; surviving spouses can receive up to $1,515 monthly or $18,187 annually, which can help cover the costs of assisted living, home care, adult day services and nursing home care.
Applicants must meet one of the following criteria:
- You have to stay—or spend much of the day—in bed due to illness
- You are a patient in a nursing home due to the loss of mental or physical abilities related to a disability
- Your eyesight is limited
The application process is complex and requires considerable documentation; therefore, you may wish to consult with a VA social worker for assistance. However, the payments could make a significant difference in the quality of care you can afford.
What About Private-Pay Options?
Since Medicare won’t cover assisted living costs, and not everyone qualifies for veterans’ benefits, you may want to consider long-term care insurance.
The sooner you apply for long-term care insurance, the lower your premiums. Most people with long-term care insurance buy it in their mid-50s or mid-60s. If you wait until your 70s to apply, you may not qualify for health-based discounts.
What Does Long-Term Care Insurance Cover?
Many long-term care (LTC) insurance policies cover care in assisted living and skilled nursing communities, as well as in-home care and adult day care. Policies typically begin paying benefits after a specified waiting period. You also have to meet specific “benefit triggers” before the long-term care insurance pays benefits. Most policies start paying once you need help with two or more ADLs.
The biggest downside to long-term care insurance is its cost. Other than your age and health, some factors that can reduce your cost of LTC coverage include:
- The maximum benefit the policy will pay
- The maximum length of time the policy will pay out benefits
- A longer waiting (elimination) period.
However, not everyone is eligible for long-term care insurance. If you are at an advanced age, have pre-existing conditions such as Alzheimer’s disease, have impaired cognitive function, difficulties with ADL, a terminal illness or substance abuse issues, you may not qualify. That’s why it’s crucial to buy long-term care insurance earlier in life rather than later.
Long-term care insurance can help finance the high cost of assisted living, skilled nursing, memory care and in-home health services. And it can provide peace of mind, knowing you’ll be able to afford quality care when and if the need arises.
Other Avenues to Investigate.
Review your existing life insurance policies. A whole life policy may have accumulated cash value that you can withdraw or borrow against.
If you or your parents are staying at home, a reverse mortgage can provide a single cash payment, a regular monthly payment or a line of credit. This type of loan may be a good option if one spouse requires assisted living and the other spouse wants to stay in the home.
Include Meadow Ridge in Your Planning.
Our assisted living neighborhood in Redding, Connecticut, is a quick drive from Fairfield, Danbury and Norwalk, and has the welcoming feel of a small community. We offer traditional assisted living services, including assistance with bathing, dressing, and medication management, so that residents can lead vibrant and active lives.
At Meadow Ridge, we emphasize all the elements of wellness and well-being, providing healthy gourmet meals, a wealth of activities and programs and many opportunities for socialization. That’s just part of what sets our award-winning community above the rest.