Does Insurance Cover Assisted Living?
Choosing the right assisted living facility is crucial in making your golden years everything they could be. But the best senior residencies can sometimes come with a hefty price tag.
If you’ve been scrolling through assisted living sites for hours, looking at their rates and crunching the numbers to see if they fit within your budget, you may be wondering:
Does insurance cover assisted living costs?
We’ll help you find the answer to that question and many more. We’ll also provide some helpful tips and tricks for navigating the financial world of assisted living.
Table of Contents
- Does Insurance Pay for Assisted Living?
- Does Assisted Living Insurance Exist?
- Long-Term Care Insurance and Assisted Living
- Can I Use My Life Insurance Policy to Cover Assisted Living? can-i
- How Insurance May Help With Assisted Living
- Other Financial Assistance Options Available for Assisted Living Costs Not Covered by Insurance
- Senior Services of America Assisted Living Facilities: Where Seniors Enjoy Positive Experiences Every Day
Does Insurance Pay for Assisted Living?
So, does insurance cover assisted living?
The short answer is no. Most insurance policies do not pay for assisted living.
But that doesn’t mean that you are stuck without a way to afford the care you need. Your regular health insurance plan might not cover assisted living, but there are insurance policies designed specifically for this type of care with various pay-out options.
You also may have other avenues available to cover the costs of assisted living, which we will explore later in this piece.
Does Assisted Living Insurance Exist?
If you search for “assisted living insurance,” you probably won’t see any companies directly offering it.
You will, however, find long-term care insurance.
Let’s dive into exactly how this works.
Long-Term Care Insurance and Assisted Living
Long-term care insurance helps to cover the cost of nursing homes, in-home assistance, and assisted living. It is designed specifically to help you pay for what you need without breaking the bank.
Does long-term care insurance cover assisted living facilities?
Yes and no.
Most long-term care insurance policies cover at least some parts of assisted living. The best way to find out your coverage is to contact your agent and have them walk you through what you’re paying for.
H4: When Should You Purchase Long-Term Care Insurance?
The best time to buy long-term care insurance is before you need it and when premiums are lower. Most long-term care insurance customers are typically between 50-65 years old.
If you’re over 70, it may be challenging to procure long-term care coverage because of:
- Pre-existing conditions
- Your general health
- High premiums
- Individual insurance company policies
If you’re planning ahead and looking into this option, there’s still time to buy. If you’re an older adult who may not qualify, we’d advise you to still contact a variety of insurance companies and see what’s available to you — especially if you’re in excellent health.
When Does Long-Term Care Insurance Coverage Begin?
The start date of your coverage is determined by the terms and conditions of your policy. To qualify for benefits, you typically need to meet certain criteria, known as benefit triggers. These are often based on cognitive impairments or the level of assistance you require with daily activities. After the insurer evaluates your needs and approves your care, they will provide details about the specific benefits you’re eligible for.
Most policies include a waiting period, also referred to as the elimination period, before benefits begin. During this time, you’ll be responsible for paying for services out of pocket, which usually lasts between 30 to 90 days. Once the waiting period ends, the insurer will start reimbursing you for the services you receive.
Other Tips About Long-Term Care Insurance for Assisted Living
If you’re thinking about buying long-term care insurance for yourself or a loved one, here are some important things to keep in mind while shopping around.
- There are many factors that can affect how much you’ll pay. These may include your age, sex, and current health conditions or health history.
- You may want to invest in a hybrid life insurance plan with an LTC rider. A hybrid policy is essentially life insurance and long-term care insurance bundled into one plan. This eliminates the typical “use it or lose it” insurance trap many policies come with, allowing the money you invest in your future to come back to you.
- Check to see if your state offers partnership plans. Some states offer Medicaid incentives to help residents get long-term care insurance, allowing you to keep assets you’d usually have to spend to get under the qualifying limit.
Can I Use My Life Insurance Policy to Cover Assisted Living?
Using your life insurance policy to cover the costs of assisted living could be a great option for you to consider. But before you make the call to your agency, there are a couple of things you might want to think about.
Using your life insurance policy to cover assisted living is a great option if you have a higher face-value policy. Typically, only policies worth $50,000, or more, are eligible.
The payout amount usually falls somewhere between 20% and 50%, with the average being 35%.
So, from that $50,000, you could expect to receive anywhere from $10,000 to $25,000. This money is paid in monthly installments that are sent directly to your care facility of choice.
There are some major pros and cons to using your life insurance policy to pay for assisted living.
Some of the pros are:
- You get money fast.
- You no longer have to worry about paying that pesky premium.
- You no longer have to manage your life insurance policy.
- Since the money goes to the facility and not to you directly, you can still qualify for Medicaid if your funds are used up.
Despite those great pros, there are some drawbacks:
- It may not be the most economically logical solution.
- You won’t be getting the whole face value of your policy.
- This closes out your life insurance policy, meaning that in the event of your passing, your family will not receive any money from it.
Converting your life insurance policy to pay for assisted living care is an option worth considering, but you need to examine the details closely to see if it’s the right one for you. Before making a huge financial decision like this, especially when it comes to insurance, you should always speak with the professionals — and in this case, your insurance agent.
How Insurance May Help with Assisted Living
As a rule, insurance (unless it is long-term care insurance) does not usually cover assisted living directly. However, it may still cover some related costs.
These may include:
- Medications
- Hospital needs
- Doctor visits
- Doctor-prescribed needs
Depending on the policy, insurance may even cover transportation costs for seniors who find it difficult to drive safely. However, many assisted living communities offer transportation services, so this may not even be an issue.
Just because your health insurance doesn’t cover assisted living doesn’t mean that it won’t still cover many of the other associated medical expenses you might have.
Other Financial Assistance Options Available for Assisted Living Costs Not Covered by Insurance
The cost of assisted living can be high. But you’re not alone as you search for the best financial solutions.
Beyond insurance, you have other options for the financial side of your assisted living stay. There are multiple programs and benefits that you could be eligible for.
VA Aid and Attendance Care
If you are a veteran, the VA Aid and Attendance Care Benefit could be your golden ticket.
This is a benefit that provides monthly payments, in addition to your pension, that go toward covering your housing and care. If you could use an extra pair of hands to assist you with daily living activities, this might be a great resource for you.
Tribal Long-Term Care Services
If you are a part of the Indigenous community, you may qualify for tribal long-term services and support (LTSS).
In addition to helping to cover the costs of assisted living to help ensure independence, healthy living, and quality of life, this program works to keep you connected to your tribal community.
State-Specific Assistance
It is also possible that your state offers specific programs designed to assist you with financial support for your assisted living stay.
State assistance is different from Medicaid and Medicare and can be an incredibly helpful resource. Check your state’s government website to look for programs you might qualify for.
Senior Services of America Assisted Living Facilities: Where Seniors Enjoy Positive Experiences Every Day
Senior Services of America’s assisted living facilities are built to be the community you didn’t know you were missing and the home you’ve always wanted. We exist to provide seniors with positive experiences every day.
No two people are the same, and no two care plans should be either. That is why you will find that we customize your care plan to ensure that you have all the independence you want and all the assistance you need.
In our communities you can find:
- Beautiful floor plans designed to suit your unique needs
- Breathtaking gardens
- Restaurant-style dining with a variety of healthy and delicious meals
- Assistance with your personal needs such as bathing, dressing, and personal care
- Crafting and other activities
- Housekeeping services
- And so much more
Our communities are truly one-of-a-kind, and we would love to help you find a senior living community near you to take your place in one of them.
