How to Pay for Senior Living on Medicaid
Paying for senior living with Medicaid is possible for many low-income seniors, but since Medicaid is funded partially by the federal government and also partially by individual states, the available aid for assisted living will change depending on which state you live in. Although the federal Center for Medicaid Services does set some guidelines on how each state must spend the funds allocated for Medicaid dollars, the states have a substantial amount of liberty within those guidelines.
The complications with Medicaid don’t stop there. In addition to different states providing different levels of aid, there are also several types of Medicaid programs available to pay for assisted living services. The most common waivers used are the Medicaid HCBS Waivers (Home and Community Based Services). Also available, though used to a far lesser extent, are 1115 Waivers and1915 Waivers or Demonstration Waivers, while regular Medicaid may also be used in some states (this can also be referred to as State Plan Medicaid).
From this myriad of choices, each has their strengths and weaknesses. Waivers generally have far higher income eligibility limits than regular Medicaid. For example, as of 2016, Medicaid State Plans may limit income to as little as $733 per month, while waivers typically allow up to a $2,199 monthly income limit. However, these numbers can vary widely depending on your marital status, state of residence, and other factors, so be sure to reference state guidelines for more information.
Another aspect to keep in mind is that waivers, while they have a higher monthly income limit, nearly always have caps on enrollment and waiting lists are common since there are only a certain number of places per state. In contrast, regular Medicaid is an entitlement, so cannot limit enrollment. In addition, regular Medicaid is less stringent regarding the level of care requirements that participants need to have, while waivers generally require participants to have “nursing home level of care needs.”
The good news is that currently 46 states now provide at least some level of financial assistance to seniors in assisted living, residential care, adult foster care, personal care homes, supported living and several other variations. Again, regulations vary widely state by state, as some states include nursing services as a benefit they will pay for, while other states only cover personal care services received in assisted living. One constant is that no state can cover room and board costs in assisted living. Some states work around this stipulation in several ways, such as putting caps on the amount a residence can charge, offering coverage on meal preparation and service (but not the actual food costs), or giving individuals eligible for Medicaid supplemental assistance. In addition, the trend is toward increasing the number of states that offer aid for assisted living residents who receive Medicaid.
One final consideration should be that Medicaid might not be best route for every family and senior. Since Medicaid reimbursement rates to the assisted living facility are not high, not every community may accept Medicaid residents. In this case, it might be more practical for the senior and family to attempt to find affordable living options without using the Medicaid system.