Do Medicare and Medicaid Pay for Assisted Living?
Medicare does not pay for assisted living. Medicaid may pay for specific assisted living care services, but federal law prohibits using Medicaid funds for room and board. Coverage varies significantly by state.
While Medicare generally does not cover assisted living costs, Medicaid might offer partial financial assistance for care.
Assisted living is expensive, often costing upward of $66,000 a year. Fortunately, there are financial aid options available to reduce personal costs.
When searching for financial assistance, however, many families question whether federal and state programs such as Medicare and Medicaid can provide assisted living coverage. The answer is both yes and no.
Does Medicare Pay for Assisted Living?
In most cases, Medicare will not pay for the cost of assisted living or any other form of long-term residential care. It is important to understand that assisted living facilities and skilled nursing facilities (SNFs) are distinct types of care — and Medicare treats them very differently.
Skilled Nursing Facilities (SNFs): Medicare will cover a stay in a skilled nursing facility for up to 100 days following a qualifying hospital stay of at least three days. This coverage applies only when skilled nursing care is required as part of physician-prescribed rehabilitation — not for long-term or custodial care. Any stay beyond 100 days must be paid out of pocket or through another means of financial assistance.
Assisted Living Facilities: Apart from the above-mentioned SNFs benefits, Original Medicare does not cover room and board, personal care assistance, and any other services provided in an assisted living setting.
Does Medicaid Pay for Assisted Living?
Medicaid provides healthcare coverage for eligible low-income adults, children, pregnant women, seniors, and people with disabilities in the United States. Jointly funded by federal and state governments, Medicaid benefits vary by state.1
In the states that offer some Medicaid assistance for assisted living residents, custodial care and housekeeping services are among the many commonly covered services. Some states also provide full coverage for transportation, case management, and medical alert systems.
Most states offer eligible seniors partial coverage for assisted living expenses under Medicaid, but don’t expect all your costs to be taken care of just because you live in the right location.
Despite state latitude, the federal government does not permit states to pay for any assisted living charges related to room and board. States still find ways to make this expense more affordable, though. Some states limit seniors’ out-of-pocket costs for assisted living room and board by imposing a legal rate maximum that communities can charge residents or offering supplemental Social Security from the general state fund to cover the charges. Some states even get creative with how costs are labeled and categorized, which allows them to pay for services such as meal preparation while not covering the cost of the food itself.
If you plan to use Medicaid to finance your stay in assisted living, keep in mind that not all assisted living communities accept Medicaid. Most states also cap the number of waivers available to seniors, and requests for receiving one can have long waits.
Savings Tip: Companion assisted living apartments — private bedrooms with shared common spaces — can save seniors as much as 50% on room and board. This cost-effective setup is ideal for extroverted older adults who are single or widowed; plus it’s known for easing the transition to care, reducing loneliness, and even improving dementia symptoms.
Medicaid Benefits for Assisted Living
Currently, 47 states and Washington, D.C. offer some Medicaid coverage for assisted living expenses. The states that do not offer this coverage are Alabama, Kentucky, and Louisiana.
States that do NOT offer Medicaid coverage for assisted living:
- Alabama
- Kentucky
- Louisiana
If you live in one of these three states, Medicaid will not cover assisted living expenses. However, your state may still offer Medicaid funding for other types of long-term care, such as in-home care or adult daycare.
Because each state has authority over its own programs, the terminology used by state Medicaid administrators may confuse older adults and their families. If you’re looking for coverage options in your state’s Medicaid benefits information, try searching the documents for phrases other states have designated for assisted living, such as residential care, supported living, alternative care facilities, adult foster care, and nonprofit personal care homes.
Assisted living residents with incomes above the maximum amount allowed for Medicaid recipients may still be able to receive Medicaid’s financial help through a variety of waivers available in each state. In many states, the allowance for increased income is as high as three times the typical maximum.
The 1915c Medicaid Home and Community Based Services and 1915b Managed Care waivers are among the most well-known and frequently used, but their availability varies greatly from state to state.
There are assisted living costs — specifically room and board — that Medicaid simply does not cover, whether you receive Medicaid through financial eligibility or a waiver. If you're lucky, you may live in a state that places a legal limit on the amount assisted living communities can charge for services government programs don’t cover.
Size Matters: Smaller assisted living communities with fewer beds typically cost less due to differences in regulatory requirements.
Qualifying for Medicaid Assisted Living Benefits
Long-term-care Medicaid is a joint federal and state program that helps low-income older adults and individuals with disabilities get the care they need. Income and asset limits for membership vary depending on factors such as the kind of care required, medical diagnosis, location, and marital status. A doctor must also certify that an older adult’s care in an assisted living facility is medically necessary.
If you fit all financial and functional eligibility requirements, then you'll still need to find a facility that accepts Medicaid and secure a space. Use your local Area Agency on Aging to identify assisted living communities that accept Medicaid.
You may want to give yourself a long timeframe to find a new place since Medicaid-certified assisted living facilities are few and far between due to very low reimbursement rates. Fortunately, there are still options if you can’t find a Medicaid-certified community. Some assisted living facilities accept Medicaid on a limited basis, but that means only a handful of beds are available at any given time for older adults using Medicaid.
If you live in a state where Medicaid doesn't cover any assisted living costs, then it may cover other types of long-term care. These states may choose to use Medicaid funding to support in-home care or adult daycare. If you aren't interested in moving and establishing residency elsewhere, you may want to look into alternatives to assisted living for which your state will grant you Medicaid coverage.
Paying for Room and Board in Assisted Living
Assisted living costs are undoubtedly high. According to CareScout (formerly Genworth)’s most recent Cost of Care Survey2, the national median cost of assisted living is $6,200 per month — and that figure can climb significantly depending on the level of care needed, geographic location, and community amenities. No matter how you slice it, it's a meaningful expense.
Your best bet is to plan for retirement and potential long-term needs early. If, however, time has crept up on you and you need to finance assisted living sooner rather than later, then see whether you qualify for Medicaid or can receive a waiver. Even if you receive Medicaid coverage, you will still be responsible for room and board. Since those fees can average roughly $3,000 per month or more, depending on your state, that means you'll owe approximately $36,000 a year even after Medicaid assistance. Personal and retirement savings, life insurance, a reverse mortgage, the proceeds from a home sale, and veterans' benefits are just a few ways to pay down your cost. Long-term care insurance can also come into play.
As you consider how you'll pay for assisted living — including the room and board portion Medicaid won't cover — remember to plan for expenses that often go overlooked, such as move-in deposits, moving expenses, and increased costs over time because of elevated care needs. Be sure to account for a 3 to 6 percent rise in prices each year as senior care costs have traditionally trended upward. By planning even just a few years ahead, you can identify ways to save yourself money and ensure you're never surprised when the bills come in.
To learn more about care options, check out our helpful guides.
Frequently Asked Questions
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How does Medicaid pay for assisted living?
It depends. Medicaid coverage of assisted living varies by state. Most states have a variety of waivers, including Home and Community Based Service waivers, that can go toward the cost of assisted living.
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What qualifies you for assisted living?
It depends. To qualify for assisted living, you must be a reasonably independent older adult who needs help with fewer than three daily living activities (dressing, bathing, toileting, etc.) and capable of moving around on your own with the aid of a walker, cane, or wheelchair. You must also not require round-the-clock supervision and be able to manage any chronic conditions with frequent medical intervention.
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Does assisted living work with Medicare?
Medicare will not pay for assisted living, but you’ll still retain the same Part A (hospital) and B (medical) benefits if you choose to move into a facility. Assisted living residents often continue seeing doctors they’ve gone to for years.
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Does assisted living take all your money?
Depending on your situation, it doesn’t have to. There’s no doubt assisted living is expensive. Fortunately, there are a variety of financial assistance opportunities that can help limit your out-of-pocket costs. There are also legal means to qualify for low-income financial assistance when you otherwise cannot. Many states, for example, allow you to place money beyond what qualifies as low income into a trust.
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How do you qualify for Medicaid long-term care?
It depends on your age, income and functional status. To qualify for long-term care financial aid under Medicaid, you must be a U.S. citizen aged 65 or older. You must also meet the income requirements for traditional Medicaid recipients or apply for and receive a waiver from your state that allows you to maintain a higher income. For long-term care coverage, you must also meet functional care criteria, which is defined by the state but typically includes the assessment of functional, cognitive, and medical abilities by a medical specialist.
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Does Medicaid pay for room and board in assisted living?
No. States are federally prohibited from using Medicaid funds to pay for the cost of room and board for residents of an assisted living community.
