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How to Pay for Senior Living: All Your Questions, Answered

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We often expect things to become clearer with age, but when it comes to finding senior living, there are so many options to choose from. Finding the right senior living home for you involves careful time and research. This blog should provide a baseline understanding of the costs associated with senior living, from general monthly costs to financial assistance programs, to help you understand what to expect. 

It’s important to note that these answers are intended to serve as general estimates. Costs can vary widely depending on location, amenities, and level of care needed. Additionally, some communities may offer financial assistance or payment plans to help offset the cost. We highly recommend researching and comparing different senior living communities to find the option that fits your needs and budget.

How Much Does Senior Living Cost?

The cost of senior living can vary depending on a variety of factors, such as the level of care needed, the location of the community, and the amenities offered. Generally, senior living costs can range from a few thousand dollars per month to more than $10,000 per month.

What Makes Senior Living More or Less Affordable?

Like other types of housing, there are several factors that impact the affordability of senior living:

  1. Location: The cost of living can vary widely depending on the region, state, and even the city where the senior living community is located. In general, areas with a higher cost of living will have higher senior living costs.
  2. Level of care: The more specialized and intensive the care, the higher the cost of senior living. For example, assisted living and memory care typically cost more than independent living communities.
  3. Amenities: Senior living communities may offer a range of amenities, such as: fitness centers, swimming pools, and gourmet dining options. Communities with more amenities will generally have higher costs.
  4. Size and type of accommodation: The size and type of accommodation can also affect the cost of senior living. Private or larger living spaces will generally cost more than shared or smaller ones.
  5. Financial assistance: Some senior living communities offer financial assistance or payment plans to help make the cost more affordable.

Will Medicare Cover Senior Living Costs?

In general, Medicare does not cover the cost of senior living. Medicare is a federal health insurance program for people 65 or older or with certain disabilities or medical conditions. Medicare primarily covers medically necessary services and supplies, such as doctor visits, hospital stays, and prescription drugs, but it does not cover long-term care options. 

However, Medicare may cover some of the costs of short-term rehabilitation or therapy services in a skilled nursing facility following a hospital stay. Medicare may also cover some hospice care services in a senior living community for people who are terminally ill and have a life expectancy of six months or less.

Will Medicaid Cover Senior Living Costs?

Medicaid may cover some of the costs of senior living for eligible individuals. Medicaid is a joint federal and state program that provides healthcare coverage to low-income individuals and families, including seniors. In some states, Medicaid may cover assisted living costs or other types of senior living communities as part of their Home and Community-Based Services (HCBS) waiver programs. 

To be eligible for Medicaid coverage for senior living, the individual must meet the income and asset requirements set by their state. These requirements can vary by state, but generally, individuals must have limited income and assets to qualify. Additionally, the senior living community must be approved by Medicaid and meet specific standards.

What Is Long-Term Care Insurance and Does It Cover Senior Living?

Long-term care insurance is a policy that covers the costs of long-term care services not typically covered by health insurance or Medicare. Long-term care insurance policies vary in coverage options, benefits, and premiums. Some policies may cover the costs of care provided in various settings, such as in-home care, assisted living, memory care, and skilled nursing facilities. Other policies may have more limited coverage options or may only cover certain types of care.

Whether or not long-term care insurance covers senior living will depend on the specific policy and coverage options selected. Some policies may cover senior living costs, while others may only cover the costs of care provided in the home or a skilled nursing facility.

What Is an Income-Based Senior Living Program?

An income-based senior living program provides affordable housing options for low-income seniors sponsored by government agencies or non-profit organizations. Eligible seniors pay a reduced rent based on their income, usually around 30% of their adjusted gross income. Seniors must meet income and age requirements to be eligible, and some programs may offer additional services and support. 

These programs can have waiting lists and limited availability, and not all senior living communities participate in income-based programs, so it’s essential to research and apply well in advance to find one that fits your needs and budget.

How Can I Plan Ahead for Senior Living Costs?

One way to plan is to research the costs of different types of senior living communities and calculate your savings and income available to cover these expenses. It’s also a good idea to consider purchasing long-term care insurance, which can help cover the costs of long-term care services not typically covered by health insurance or Medicare. Additionally, researching other financial assistance options, such as Medicaid and Veterans benefits, can provide additional support.

Senior Living Planning Assistance From Walker Methodist

Walker Methodist is a faith-based non-profit that owns, operates, and manages a number of senior living communities in Minnesota and Wisconsin. We help older adults find the perfect community to call home, and we provide healthcare, rehabilitation, and services to seniors and the people who support them.

As a way to alleviate some of the concern, confusion, or fear that can accompany the change senior living might bring, we’ve created an All-in-One Financial Planning Guide as a resource for older adults and their families. Download the guide below for information to help you plan for the financial side of senior living. 

Download free guide

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