SURE I LIKE COMPANY, BUT I LIKE BEING ALONE BETTER

Medicaid is a government program that will help pay the cost of long-term care. Assisted living residences (“ALR”) are part of the long-term care continuum, and Medicaid will help pay the cost of an ALR.

I say that Medicaid will help pay for an ALR, not that it will pay for an ALR, because a Medicaid recipient must pay for the cost of his room and board at the ALR. On this issue, the Medicaid program that relates to ALRs is different from the Medicaid program that relates to nursing homes.

When an individual qualifies for Medicaid in a nursing home, all of their income goes to the nursing home – except for $35 that he can retain as a “personal needs allowance” – and Medicaid pays the remainder of the care costs, no matter how high those cost may be. When Medicaid pays for a nursing home, the program is paying for the care the person is receiving (i.e., nursing care) and for the room and board that is an incident to the care that is being provided.

But the room and board associated with an ALR is not, according to Medicaid, a necessary incident to the assistance that the individual is receiving. Stated otherwise, the person could receive the same assistance at home that he receives at the ALR – for example, by hiring a home health aide to come to his house for two hours a day – so Medicaid won’t pay for the room and board.

What this means to the person in an ALR who is receiving Medicaid benefits is, he must pay for his room and board. Medicaid sets a rate for the room and board, called a “cost share,” that the person must pay each month. Currently, the cost share is approximately $640 a month. This is the amount of money that a Medicaid recipient in an ALR must pay for his room and board. That payment gets him a semi-private room.

Now, most people don’t like roommates who aren’t related to them. (Most people don’t like roommates who are related to them, but I’m trying to be kind.) So the question is, can the person’s room and board charge be increased so he can live in a private room? The answer is, yes and no.

The Medicaid recipient cannot pay the cost differential between a semi-private and private room, because any income that he has above the cost share – i.e., above $640 per month – must also be paid to the ALR to reduce the amount that Medicaid reimburses to the residence for the medical care component of his residency. Stated otherwise, even if the Medicaid recipient has more than $640 per month in income, all of his income must be paid to the residence (except for $81 a month that he can retain as a personal needs allowance), so he doesn’t have an excess income.

Medicaid will, however, allow the family to supplement the resident’s room and board charge. In other words, the family can pay the facility the differential and allow the Medicaid recipient to stay in a private room when he begins receiving Medicaid benefits.

This permitted supplementation is another reason why families should try and protect some of their parent’s money through Medicaid planning, so the money transferred to the family can then be used to supplement mom’s or dad’s stay at the ALR.

Medicaid can help cover some assisted‑living‑related care, but it doesn’t always pay for room and board the way people assume. Knowing exactly what’s covered and how eligibility works can help you plan smarter for your loved one’s care and avoid surprises later.