Decoding the Price Tag: Assisted Living Facilities Examined

The average annual U.S. salary in 2024 is $59,384. That's great news, considering the average annual salary was around $56,000 in 2022. But despite the increase, money goes fast when you account for living expenses.

For example, you and your parents have discussed assisted living communities. You've all decided it's best if they opt for more reliable senior care. As much as you'd like to, you can't be near as often.

Comparing the cost of assisted living facilities is integral to finding the right place. You want a place offering great senior living care, but affordable enough that you and your parents can afford it.

Below, we discuss how much assisted living options cost and how you can pay for them. You need to know how far you and your parents' money can stretch and what to do if it can't.

How Much Is Assisted Living?

Here's a brief overview of assisted living: a community-based center where older adults live independently. Your loved ones participate in social events and have help with daily tasks and minor to moderate medical conditions.

A nursing home is a community that caters to higher-level medical conditions. Residents can participate in social events, but the focus is on health issues. We promise all this will be relevant soon.

In 2023, the median monthly cost of assisted living communities was $5,350, according to the Genworth Cost of Care Survey. The median price of a nursing home ranged from $8,669 to $9,733.

The price differential depends on whether your loved one has a semi-private or private room, respectively. A semi-private room has a maximum occupancy of two persons and a shared bathroom.

Here is why all this matters: You should consider your loved ones' needs and housing costs. If they're a little wobbly on their feet and have lowered vision, an assisted living center is your best bet.

They don't have issues severe enough to warrant a nursing home. However, say your loved one suffered a stroke and a bathroom fall. You may want to consider a nursing home. They're better equipped to care for your parents.

Succinctly put, budgeting is fine. But sometimes, your needs outweigh the costs. Conversely, don't pay for more than you need. Transferring to a nursing home is always possible when necessary.

Medicare vs. Medicaid: What Are They?

Medicare is federal health insurance for people 65 and older and those with certain conditions and disabilities under 65. For example, someone with low vision and blindness can receive Medicare under 65.

Because Medicare is a federally-operated program, there are standardized costs and coverages. This means your home state does not determine your coverage; it's the same across the country.

Medicare-related bill payments come from two U.S. Treasury trust funds. The money within said trust funds comes from various sources like payroll taxes and Congress.

People with Medicare pay partial costs via monthly premiums. These premiums include medical and drug coverage, deductibles, and coinsurance.

Medicaid is a joint federal and state-funded program covering medical costs for those with limited income and resources. The federal government has guidelines for Medicaid, but eligibility and requirements vary across states.

Medicaid offers benefits Medicare doesn't. People with Medicaid usually don't pay for covered medical expenses, but they may pay a small copayment for some things.

Some people qualify for Medicare and Medicaid. This is called dual eligibility. If your loved ones are dual-qualified, most of their healthcare costs are taken care of.

Does Medicare or Medicaid Pay For Assisted Living?

Neither Medicare nor Medicaid pays for assisted living. Medicare comes in four parts A, B, C, and D. You can learn more here, but for now we'll focus on Parts A and B or Hospital and Medical Insurance.

Here's what Parts A and B cover:

Inpatient hospital care
Inpatient care in a skilled nursing community
Hospice care
Medically required services from doctors and healthcare providers
Home health services
Preventative services

Here are the benefits your loved one receives from Medicaid:

Doctor's visits
Hospital stays
Long-term services and support
Preventative care
Required medications

Your loved one's residency in an assisted living center doesn't impact receiving these services.

Does Medicare or Medicaid Pay For Nursing Homes?

Using Medicare or Medicaid to pay for a nursing home is tricky. We said Medicare pays for nursing home care, but it's only short-term. Medicaid does pay for nursing homes but isn't accepted by all.

There's also the matter of Medicare being the "last resort." Many people needing nursing homes will often have to exhaust other financial options.

How Can You Pay for Assisted Living?

Paying for senior living can be tricky. The average retirement social security check is $1,856.38. Despite this, many people use personal funds to cover senior living care costs.

They may have other personal savings and pension payments. Some people's children pay for their assisted living communities. Many use their private insurance policies to pay for their living arrangements.

Others opt to reverse mortgages and sell life insurance policies. A reverse mortgage is when a homeowner borrows money based on their home equity.

Selling a life insurance policy is when someone sells the policy to someone else in return for a cash payment. You can ask the assisted living community about discounts or flexible pricing.

It also helps to budget. Don't choose assisted living options your loved ones don't need and neither of you can afford.

Having Trouble Comparing the Cost of Assisted Living Facilities?

Comparing the cost of assisted living facilities can be an arduous process. You're weighing your loved one's needs vs how much you all can afford.

Firstly, you've got to be sure assisted senior living is right for your parents. If they need a nursing home, you should spring for it. When you pick the right type of senior care, you've got to know how you'll pay.

You have many options, including private funds and private insurance. Addington Place of Des Moines can help you make the choice.

You can speak with our professional and experienced staff about pricing and amenities. We also offer a military veterans' program. Reach out and let's discuss your options.