Does Medicaid Cover Assisted Living?

Medicaid covers assisted living for qualified individuals in most states. As of 2021, the median monthly cost of assisted living is $4,500, so if you qualify for Medicaid, it can significantly reduce your financial burden when it comes to getting the care you need. However, the services that are covered can vary widely depending on the state you’re in. Additionally, the program has income-based requirements you’ll need to meet before you can qualify.

In some states, Medicaid covers services within assisted living facilities, while others may only pay for nursing home costs. Many states offer Home and Community-Based Services Medicaid waiver programs that cover in-home care for seniors who are at risk of placement in a nursing facility.

Typically, Medicaid pays for case management, personal care, transportation to medical appointments, emergency response systems, meal preparation and light housekeeping. Medicaid may also cover medication management, home health care and on-site therapy services, such as physical, speech and occupational therapy. Additionally, it covers co-pays for skilled nursing care that aren’t covered by Medicare. Medicaid doesn’t cover the price of room and board in any state, so recipients must find other means to pay for these costs.

Seniors must meet strict income and asset limit requirements for Medicaid to pay for assisted living. In 2023, individual income is limited to $2,742 per month and countable asset value can’t exceed $2,000. Many seniors must spend down their assets and pay for assisted living out of pocket until they become eligible for Medicaid. It also has a look-back period of about 5 years to ensure that assets weren’t given away or sold for less than market value to enable a person to qualify for the program. Actions such as transferring a home to a family member or donating items to charity may violate the look-back period. If an individual is found in violation, they may be disqualified from receiving Medicaid benefits.

To receive Medicaid for assisted living, seniors must demonstrate a functional need for care. This means they require a nursing home level of care and are at risk of institutionalization without Medicaid benefits. Generally, seniors must also need help with at least two activities of daily living, including feeding themselves, transitioning into and out of bed, using the toilet and getting dressed. Exact functional need requirements vary by state.