Assisted living is a popular option for seniors and their families who are planning for long-term care in the future. And, as the cost of long-term care rises, many hope that Medicare will cover these costs.
However, this assumption often leads to frustration as seniors discover that Medicare does not offer the support they anticipated. Let’s discuss what Medicare does and does not cover when it comes to assisted living and what other alternatives exist for long-term care coverage.
What Medicare Covers – and What It Doesn’t
Medicare is a federal program that helps cover the costs of healthcare for seniors and those with certain disabilities. While it provides essential medical coverage, it was never designed to cover long-term care expenses.
Medicare’s Scope of Coverage
To understand what Medicare covers, let’s break it down by its parts:
- Part A (Hospital Insurance): Covers in-patient hospital stays, nursing care after a qualifying hospital stay, and hospice care. Part A does not cover long-term stays in assisted living facilities.
- Part B (Medical Insurance): Covers outpatient care, doctor visits, preventive services, and some home medical equipment. Like Part A, Part B does not extend to assisted living facility stays.
- Part C (Medicare Advantage Plan): This is an alternative to traditional Medicare offered by private insurance companies. It covers services that both Parts A and B cover, as well as some additional services like dental, vision, and hearing. Unfortunately, long-term assisted living is rarely part of this additional coverage.
- Part D (Prescription Drug Coverage): Covers prescription medications but, again, offers no financial support for assisted living services.
Why Doesn’t Medicare Cover Assisted Living?
It all comes down to how Medicare defines this type of long-term care. Assisted living is primarily classified as “custodial care,” or nonmedical care. Assisted living focuses on personal care assistance like housekeeping, bathing, toileting, and dressing, whereas Medicare coverage is focused on acute medical care or short-term rehabilitation. Therefore, most long-term care costs, including assisted living and nursing home care, are not covered.
Understanding Medicare coverage is murky at best, so it’s common that someone might assume they’re covered, only to find out later they are not. Some common scenarios where this could be the case include:
- Absence of a Qualifying Hospital Stay: Medicare will cover up to 100 days of care in a skilled nursing facility after a qualifying hospital stay. However, if a senior moves directly to a facility without the corresponding hospital stay, it will not be covered.
- Assisted Living Without a Skilled Nursing Need: Similarly, Medicare may cover short-term stays in skilled nursing facilities when a senior needs intensive rehabilitation following an illness or surgery. Again, if the individual moves to an assisted living facility, Medicare likely will not cover the cost.
- Needing Custodial Care Instead of Medical Care: Medicare covers skilled nursing care but not custodial care. If a senior only needs help with personal care tasks, they won’t qualify for Medicare-covered services.
Alternatives to Medicare for Assisted Living Costs
It’s surely disappointing to hear that Medicare won’t cover assisted living costs, especially if that is why you initially applied for it. However, there are several other payment assistance options for long-term care. For qualified seniors, these can be crucial to receiving care without financial strain.
Long-Term Care Insurance
Long-Term Care Insurance is another option to consider. This insurance is specifically designed to cover costs associated with long-term care needs, including assisted living.
Premiums are expensive, and eligibility depends on health and age. The sooner someone secures a long-term care insurance policy, the better, as it can be difficult to qualify as individuals age. However, if purchased well before a senior needs care, these policies can provide a substantial benefit.
How Much Does Long-Term Care Insurance Cost?
In 2024, the average cost of long-term care insurance is $1,200 annually for a 60-year-old man for $165,000 coverage. The average cost for a 60-year-old woman is $1,960 for the same coverage. The cost of long-term care insurance varies widely based on factors like the individual’s age, health, the type of coverage, and the insurance provider.
Veterans Benefits
Seniors who have served in the military may be eligible for Veterans Affairs (VA) benefits, which can help cover the cost of assisted living. The Aid and Attendance benefit is also available to veterans and their surviving spouses who require help with activities of daily living. This benefit can be applied toward the cost of assisted living, home care, or nursing home care.
Continuing Your Exploration for Long-Term Care Coverage?
While Medicare does not cover assisted living costs, understanding what it does and doesn’t cover is the first step in preparing for the future.
Alternatives like Medicaid, long-term care insurance, and Veterans benefits can provide valuable financial assistance for seniors. By exploring these options early, you can ensure your loved one receives the care they need without unnecessary financial stress.
Lucy Corr cares for our senior community here in Virginia and is happy to help provide additional resources to help you navigate these costs.
