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Ways to Pay for Assisted Living
Various Options are Available to Pay for Assisted Living

How to Pay for ALF
How to Pay for ALF

For older adults, paying for assisted living is a juggling act because the average income of a resident is $27,260 while the costs run close to $3,022 a month. (Data from American Living Facilities Association, ASHA, AAHSA, NCAL & NIC 2009 Overview of Assisted Living)

Residents must tap additional resources to cover the cost, and the funds often come from the sale of their biggest asset: their homes. According to the same data, the average total assets for residents, including the home, is $431,020.

How Do People Pay for Assisted Living?

Most people don't have a lot of family members willing to help, so older adults are left scrambling and dependent upon the government for help. That's where Medicaid comes in. Others, who have served their country, rely on Veteran Attendant and Aid for assistance. Some continue living at home as long as they can while many move to another country where long-term care is good and less expensive. Read below what a frequent international traveler says about living elsewhere.

Browse the AssistedLivingFacilities.org, Paying for Assisted Living Section

Here consumers find the latest information on ways to pay for senior living. The topics covered:

Private Funds

Life Insurance

Reverse Mortgage

Lines of Credit

Social Security Benefits

Annuity

Private Funds & Personal Assets

Part-time Work

Trusts

Long Term Care Insurance

Medicare

Supplemental Insurance

Veterans Benefits

Disability Benefits

Section 8 Housing

Additional Options for Paying for Senior Living Care

Living at Home

The role of family members in providing informal care to aging relatives and others living in the community is widespread, but less attention is on their role in financing formal services. At one time, most countries, even the U.S., assumed that families would have the primary responsibility for paying for long-term care, with public assistance targeted at people with no available family support. In the US with means-tested social assistance programs, income and resources of spouses are commonly considered in determining eligibility.

Medicaid pays for assisted living at home in the Home and Community Based Services (HCBS Medicaid Waivers). The number of states offering these Medicaid Waivers has increased, and assistance is available nationwide, very soon.

Medicaid and Assisted Living

From Medicaid's point of view, assisted living is less expensive than skilled nursing homes. State legislation moves toward paying for assisted living.

States understand that offering financial assistance to frail, elderly individuals for assisted living is less costly to the state than having them go into a Medicaid-funded home. At this time, not every state has a Medicaid Waiver to pay for assisted living.

Learn your state-state based financial assistance programs. Data covers the cost of assisted living and more care. Some programs provide aid not designed for assisted living.

Other Pay Sources for Assisted Living

Over 1.5 million low-income elderly people receive federal rental assistance, amenities, care services, transportation or housekeeping. That source is the U.S. Department of HUD. There is a federal tax credit for developers of low-income housing; some of these developments also offer supportive services.

Long-Term Care Insurance Partnership

The Long-Term Care Partnership Program, initiated in the late 1980s and funded by the Robert Wood Johnson Foundation. Four states (California, Connecticut, Indiana and New York) were the original four states selected to participate.

The Long Term Care Partnership Program is not uniform across all states.

Experts point of that there is more uniformity across the Deficit Reduction Act authorized states to offer Partnership states. However, that the new DRA states face a series of decisions in designing their Partnership programs.

What States Have Approved Long-Term Care Partnership Insurance For Sale

Access the table showing the latest status based on information provided to the Association. (Last updated March 2014)

Living Abroad

"I travel a lot internationally, if either I or my spouse needs long-term care my plan is for one or both of us to move to Costa Rica. They are known for excellent medical care there. Also an advantage of a country like Costa Rica is that a job is more valuable to their citizens than it is in the US. The workers make a lot less but they are more highly motivated. Especially for those with lower incomes this could really help you. Your Social Security checks may cover all of your long-term costs and you will be better cared for. Just something to think about. If you prefer something along the assisted living options those are also available and at fraction of US prices. You can have a full-time maid and cook for around $350 a month there. And housing prices are also pretty reasonable."

Before hitting the road and moving to another country, check into what happens to a retiree's federal benefits while out of the country? The short answer: Social Security benefits are available to retirees in other countries, Medicare generally is not. Read ElderLawAnswers.com on Medicare.

Find information about citizenship, visas, education, marriage and divorce, travel warnings, and more, visit Americans Abroad.

Americans Living and Traveling Abroad

Living Abroad, Linking Expats

Americans Living Abroad

If living outside the U.S. is not an option, there are ways to find financial resources that help pay for assisted living.

Assessing Tradeoffs and Reforms in Long-Term Care

Policymakers considering reforms in long-term care financing seek a balance among a variety of competing goals and priorities. Some analyses of long-term care systems contend that there are really only a few basic models; once choices made on one or two aspects of program design, decisions on other details are more or less automatic.

A universal entitlement program that targets both the poor and non-poor promotes equity and garner broad public support; but if cost control and targeting are priorities, these goals are better achieved through a means-tested program operating on a fixed budget. (Source: NASI.org)

Carol Marak
Carol Marak

After seven years of helping her aging parents, Carol Marak has become a dedicated senior care writer. Since 2007, she has been doing the research to find answers to common concerns: housing, aging and health, staying safe and independent, and planning long-term.