How do People Pay for Assisted Living?

Most people pay for Assisted Living with current income from social security and pensions coupled with the use of savings, including the proceeds from selling a home. Long Term Care Insurance is more and more widely used to offset the cost of Assisted Living. Some consumers convert life insurance policies to a loan, and others have family members who help pay a share of the monthly cost.

Medicare and other health insurance plans

and HMOs will NOT pay for assisted living services.

There is, however, a program for veterans that will

contribute over $1,800 a month (and over $2,100 for couples)

called the Veterans’ Aid and Attendance Benefit.

Financial assistance programs, including Medi-Cal, may be

available for those with limited resources, although not every

Assisted Living community participates in these programs. In California, for example, there is the Assisted Living Waiver Program, as well as Section 8 housing.

Because the vast majority of residents pay privately and every Assisted Living community is different, you are encouraged to speak with someone at each community to learn more about the payment options the specific residence accepts.

Everything You Want To Know About Assisted Living Costs

What is typically included in the monthly fee at an Assisted Living community?


Typically, the basic monthly fee covers what is necessary for you or your loved one to live comfortably. This includes an apartment, ranging from shared accommodations to private apartments (studio, 1BR or 2BR), utilities (heat, AC, electricity), maintenance, weekly housekeeping and laundry of bed linens, organized programs for social, fitness, cultural and educational pursuits, and 24 hour staffing. Most often three meals per day are included in the basic fee. Help with personal care needs such as bathing, dressing and grooming, as well as medication management, will be available but may or may not be in the basic fee. If not, it will be available at an extra fee, either in a package or on an hourly basis. Transportation to medical appointments and recreational trips, personal laundry service, beauty salon services, and escorts and reminders for meals and activities may be available. These services may be included in the monthly fee or there may be extra charges.




What is not Inculded in the Monthly Fee?


Typically residents pay directly for Cable TV, internet and telephone service for their apartment home (although more and more communities have free WIFI throughout the building). Residents pay for their own personal toiletries, health and beauty aids, hairdressing, clothing, medical care, medications, incontinence supplies, and dry cleaning (and they typically pay an extra charge to the Assisted Living community to do their personal laundry). Very often medication management and incontinence help are not included in the basic fee. Not every resident needs these services - they are considered ancillary and charged for separately




Is the monthly fee a set rate or does it change?


Most Assisted Living communities have a year-long lease that residents sign, just like renting an apartment. The base monthly fee will be a set amount outlined in the lease, but the total monthly cost depends on the fee system used to calculate personal care where your Mom or Dad lives. Also keep in mind that most Assisted Living communities will increase their fees every year. Ask the community what their typical increase has been for the last few years. This will give you a good indication what to expect when your one-year lease is up for renewal.




Why do costs vary Between Assisted Living communities?


Costs may vary: By the amount and kind of personal care assistance included in the service package. You may be quoted a price based on your loved one needing no care, a small amount of daily care or a large amount of care. Under a tiered pricing structure in which costs are calculated based on the actual number of hours/minutes that care was provided, initial quotes may not reflect the true costs that your Mom or Dad will actually incur. If your loved one needs more care than the allotted time under the “tier” you are paying for, your cost for care will increase. By the size, location and special features of the apartment. Accommodations can range from a shared bedroom to a two-bedroom apartment. Some communities charge more for apartments that are considered “prime” for characteristics such as proximity to an elevator, great views, extra closets or oversized windows. By geography. Land, real estate taxes, insurance, construction costs and labor all vary geographically and they affect the cost of developing and running an Assisted Living community. For example, Folsom is more expensive than South Sacramento. Even within the same state Assisted Living communities in wealthier towns will cost more than in other towns and cities. By the company. Some companies charge more than others, perhaps because they need to maximize profits for stockholders or they have a large corporate headquarters with more overhead.




What is the All-inclusive Fee System?


In an All-Inclusive Fee System, there is one total monthly fee for housing, meals, activities, housekeeping, laundry and transportation AND personal care assistance with dressing, bathing and other activities of daily living. The amount of personal care per day that is included within the fee is usually outlined in the Residency Agreement - it may be 1 to 2 hours a day. Before you move into an Assisted Living community you should have an assessment done and a personal care plan developed that covers all the needs of the resident. With all-inclusive fees, charges for additional care should be rare and limited. Even with Assisted Living communities that offer all-inclusive care pricing, very often medication management and incontinence help are not included. Not every resident needs these services; including them in the basic fee would result in some residents paying for a service they don’t need. Some other services that can cost extra in a community offering all-inclusive care pricing is transportation, with or without a staff escort, to medical appointments as well as personal laundry service. Although all-inclusive is a simple fee structure, under this system a resident who is very independent but enjoys the community’s social and dining services will pay the same monthly fee as a resident who requires daily assistance with bathing, dressing and reminders and escorts to programs and activities. Most families would prefer a community that structures their care packages and fees based on the individual needs of each resident. Be prepared to ask exactly what services and amenities are actually included.




What is the A la Carte Fee System?


A basic fixed monthly fee covers housing, meals, housekeeping, some laundry and activities BUT all personal care is extra. "A la carte" charges may be tracked by the specific service such as a shower assist or by time. Time is usually measured in quarter hours. Therefore, a two-minute cue can cost one-quarter hour. As you can imagine, it takes a lot of time and effort for an Assisted Living residence to operate a complex a la carte fee system. A la carte pricing in Assisted Living doesn’t allow for predictable budgeting. Each month brings a bill that can be surprising and potentially lead to disputes between residents and their families with the Assisted Living community. What do you do when your Mom, whose memory is not great, says that she didn’t have a shower on Tuesday?




Do Assisted Living fees cover medical services or perscription costs?


That depends on your state. There are different regulations in place which vary state by state. In most of California, Assisted Living communities cannot provide any medical or skilled nursing services, but many of them have relationships with local medical professionals who can provide care conveniently onsite, such as Temporary Agency Skilled Nursing (VNAs), Podiatry, and Physical, Occupational and Speech Therapies. Payment for any of these medical services and any prescription medications will continue to be covered by your loved one’s health insurance. Moving to an Assisted Living community doesn’t change that. Also residents continue to pay for their own doctor visits, other medical appointments and hospital visits through their health insurance. If a resident takes advantage of the Medication Management Program at an Assisted Living community, the community may recommend a local pharmacy to fill the prescriptions in a convenient pill pack; the resident will pay for their medications directly to the pharmacy.





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