Table of Contents
Does Medicaid Pay for Assisted Living?
Yes, Medicaid will help to cover the cost of assisted living, including memory care (Alzheimer’s care units). In addition to long-term care services, such as personal care and homemaker assistance, Medicaid may also pay for emergency response systems and skilled nursing in this setting for seniors who meet the eligibility requirements. Medicaid, however, will not pay the cost of room and board.
Medicaid is a federal and state program, and the eligibility requirements, available programs, and benefits vary based on the state in which one resides. This is because each state has a degree of flexibility on how it operates its program within the parameters set by the federal government. Furthermore, within each state there are multiple Medicaid programs with varying pathways towards eligibility. Therefore, the subject of whether Medicaid covers assisted living is not as straightforward as one might originally think.
For purposes of further explanation, most states offer Home and Community Based Services (HCBS) Medicaid Waivers in addition to their Medicaid State Plan / Regular Medicaid program. All states offer personal care assistance through Medicaid. Some states only offer it through their state plan, other states offer it only through HCBS Medicaid Waivers, and other states offer it through both the state plan and HCBS Waiver(s). Even so, not all states cover personal care services in assisted living residences.
Regular State Medicaid
State Medicaid, which is an entitlement program, provides a variety of health care benefits mandated by the federal government. For instance, all states must cover the cost of nursing home care for all state residents who meet the eligibility requirements. There are also optional benefits, such as state plan personal care, which are left to the discretion of each state. Since Medicaid State Plan benefits are guaranteed to eligible persons, if a state offers personal care assistance and one meets the eligibility criteria, they will receive services. There is never a waiting list for assistance.
There are also state plan options through which assisted living services can be provided. Made possible by the Affordable Care Act, a state can implement a 1915(k) Community First Choice (CFC) program. Via CFC, home and community based services are offered, which may include attendant services in assisted living residences. Another state plan option, 1915(i) Home and Community Based Services, offers supportive services for independent living. Like the Medicaid State Plan benefits, participant enrollment cannot be capped and geographic location cannot be limited within a state.
Personal care services via Regular State Medicaid / state plan options may be provided via managed care. This can be authorized through a 1932(a) State Plan Amendment.
HCBS Medicaid Waivers
Most states offer Home and Community Based Services Medicaid Waivers, also called 1915(c) Waivers, which enable persons to continue to live at home or in the community rather than be placed in a nursing home. Waivers do this by providing care services and other benefits that aid independent living, such as personal emergency response systems, adult day care, respite care, home modifications, personal care assistance, home health aides, meal delivery, and housekeeping.
With HCBS Medicaid Waivers, seniors and persons with disabilities can live in a variety of settings and receive Medicaid funded services. While the specific settings differ based on the state in which one resides and the Waiver, persons may live at home, the home of a relative or friend, an adult foster care home / adult family living home, a residential group home, or an assisted living residence.
Differing from the Medicaid State Plan, Waivers may not be available statewide and may target specific populations. For instance, Virginia used to offer assisted living services via a HCBS Medicaid Waiver, but only for persons with Alzheimer’s disease and related dementias. Unfortunately, this is an expired waiver program and is not being renewed.
Participant enrollment in a HCBS Waiver is limited. This means a waitlist for long-term care services may exist. If it does, the wait for benefits can be years. Some states use a “first come, first served” prioritization system, while others are based on need.
Some states require program participants to receive their long-term services and supports via managed care. It is through 1915(b) Waivers that this type of care is authorized. 1915(b) Waivers are combined with 1915(c) Waivers to require program participants receive managed care home and community based services.
States can also offer HCBS via 1115 Demonstration Waivers, which also may have waitlists for benefits. These benefits may also be provided via managed care. More about HCBS Waivers.
Which Services Will Medicaid Cover?
Based on one’s state of residence and the specific Medicaid program in which one is enrolled, the benefits Medicaid will pay for vary. The following are typical services that are available for persons living in assisted living residences:
- Personal Care Assistance (help with dressing, bathing, toileting and eating)
- Homemaker Services (housecleaning, laundry, shopping for essentials such as groceries, and meal preparation)
- Nursing Services
- Case Management
- Personal Emergency Response Systems
Medicaid will not pay for the room and board portion of assisted living. However, many states do offer an optional SSI State Supplement (OSS). This is a cash assistance program to help cover room and board costs. This benefit, which may also be called State Supplementary Benefits, supplements federal SSI payments a person already receives. The administering agency differs based on one’s state, but in most states, it is either the Department of Human Services (DHS) or the Social Security Administration (SSA). A list of all local DHS offices should be found on each state’s Medicaid website. Find the SSA office nearest you.
How Much Does Medicaid Pay?
The amount that Medicaid will pay towards the cost of long-term care services in assisted living residences depends on a variety of factors. This includes the state in which one resides, the Medicaid program, and one’s level of care need. For instance, it is common for persons who have a greater need for assistance to be allocated a greater number of caregiver hours each month. The number of hours that Medicaid will cover is usually based on a needs assessment. Remember, Medicaid will not cover the room and board portion of assisted living costs, which as a rule-of-thumb accounts for approximately half the cost of assisted living.
Eligibility Requirements for Medicaid Assisted Living
Persons must be a resident in the state in which they are applying for Medicaid. They must be residing (or be willing to reside) in an assisted living facility that is licensed by the state and accepts Medicaid. These residences are often called “Medicaid certified”. Persons must also meet financial (income and assets) and functional requirements for the Medicaid program for which they are applying. The criteria below are specific to seniors who are aged 65 and over.
Income and asset limits for eligibility purposes generally vary based on if a person is applying for State Plan Medicaid versus a HCBS Medicaid Waiver. In most states, the income limit is more restrictive for Medicaid State Plan services than for HCBS Medicaid Waivers. In 2024, Medicaid State Plans generally limit one’s income to 100% of the Federal Poverty Level ($1,255 / month) or 100% of the Federal Benefit Rate ($943 / month). For HCBS Waiver programs, an applicant generally must have income no greater than 300% of the Federal Benefit Rate (FBR). In 2024, this is $2,829 / month. Assets are usually limited to $2,000 for both State Plan Medicaid and HCBS Medicaid Waivers. See state-specific eligibility criteria.
Being over the income and/or asset limit(s) is not automatic cause for Medicaid disqualification. Professional Medicaid Planners are available to assist persons in restructuring finances to meet financial eligibility requirements without jeopardizing Medicaid eligibility. Improperly restructuring finances, such as gifting assets to family members, is a violation of Medicaid’s Look-Back Period and results in a Penalty Period of Medicaid ineligibility. It is recommended persons seek the counsel of a Medicaid Planner, as they are very familiar with planning techniques for Medicaid eligibility. Find a professional Medicaid Planner.
Applicants must have a functional need for Medicaid assisted living. This often means one must require a Nursing Home Level of Care and/or be at risk of institutionalization if not for the program’s benefits. The definition of what constitutes a level of care consistent to that which is provided in a nursing home varies by state. For some states, this might mean that persons require personal assistance with two Activities of Daily Living, such as removing and putting on their clothes, cutting up food and getting it in their mouths, using the toilet and cleaning up after themselves, and transitioning from their bed to a chair. Some programs require a physician statement indicating that personal care services are required. While one might think a diagnosis of Alzheimer’s disease automatically qualifies one functionally for long-term care Medicaid, this is not always the case.
*For the state plan option, 1915(i) Home and Community Based Services, applicants must not require a Nursing Home Level of Care. Instead, the functional need of applicants must be less than that which is provided in a nursing home.
See Medicaid eligibility requirements by state.
Which States Cover Assisted Living
Some states cover care services, such as personal care assistance, through their Medicaid State Plan, others via HCBS Waivers, while others utilize both the State Plan and Waivers. Not all assisted living residences in all states accept Medicaid for payment of care services. In some states, assisted living residences may not accept Medicaid at all. For example, Alabama, Kentucky, and Louisiana do not offer Medicaid-funded services in assisted living. Additionally, Illinois Medicaid will not make payments towards the cost of benefits in assisted living residences, but will pay for care services in supported living facilities.
State Medicaid Plan / Community First Choice / 1915(i) HCBS
The following states offer personal care assistance through their Medicaid State Plans. This does not automatically mean the state will cover personal care assistance in assisted living facilities. Nor does it mean the assisted living residence in which one resides will automatically allow outside assistance to enter the residence and provide care.
• District of Columbia
• Louisiana (does not offer assisted living services)
• New Hampshire
• New Jersey
• New Mexico
• New York
• North Carolina
• North Dakota
• Rhode Island
• South Dakota
• West Virginia
HCBS Medicaid Waivers / 1115 Demonstration Waivers
The states named below offer care services and benefits in assisted living residences via HCBS Medicaid Waivers or 1115 Demonstration Waivers. Remember, waitlists may exist.
• District of Columbia
• Illinois (not for assisted living, but for supportive living facilities)
• New Hampshire
• New Jersey
• New Mexico
• New York
• North Dakota
• Rhode Island
• South Carolina
• South Dakota
Which Assisted Living Residences Accept Medicaid?
Not all assisted living residences accept Medicaid. When considering a residence, ask if it is “Medicaid certified”. Furthermore, assisted living residences that accept Medicaid limit the number of beds for Medicaid-funded residents. This means only a certain number of beds in the residence are available for persons on Medicaid.
In some cases, even if the residence does not accept Medicaid, or does not have a Medicaid bed available, the facility may allow third party caregivers to come in and provide assistance for their residents. Medicaid would pay the third party caregiver who does not work for the assisted living residence. Therefore, in this case, it isn’t important if Medicaid is accepted by the facility. If considering this option, ask the assisted living residence if they accept outside caregivers.
Unfortunately, there is no nationwide searchable database for Medicaid certified assisted living residences. To find an assisted living residence in your area that accepts Medicaid and has an available bed, contact your local Area Agency on Aging (AAA) office. Most AAA’s keep a list of facilities in their area that accept Medicaid, and if they don’t, they often can direct you to a searchable state database.
- Take a Medicaid Pre-Screen Test to determine if the candidate might be automatically eligible for Medicaid.
- Discuss the feasibility of using Medicaid as a payment source with a Medicaid Planning Professional. While many Medicaid beneficiaries do receive help in assisted living, many others encounter obstacles that prevent them from doing so.
- Contact current or potential assisted living residences and inquire if they 1) accept Medicaid and have Medicaid “beds” available or 2) allow outside (third party) caregivers to come in and provide assistance.