Medicare pays part or all of the costs of a broad range of health-care expenses, including those incurred while you're in the hospital as well as outpatient and other services rendered by a physician or other health-care professional. Except in limited circumstances, though, Medicare does not cover the costs of custodial care either at home or in a facility like a nursing home or assisted living facility when that's the only care you need.
A philosophy of care that emphasizes independence and dignity, assisted living provides long-term-care support services in an environment of individual housing units that permit residents a higher degree of independence than that afforded by a nursing home. It serves people who are disabled as well as elderly people who need help with the activities of daily living, or ADLs -- people for whom independent living is not practical but who do not require the round-the-clock attention found in a nursing home.
Assisted Living Facilities
Often structured like apartment complexes, with scores of small apartments for individuals and couples as well as several common areas, assisted living facilities generally provide a range of services, including supervision of assistance with ADLs, coordination of services by outside health-care providers, nursing and rehabilitation services and emergency services, but the bulk of the services provided are more custodial in nature. If a resident is receiving physical therapy, Medicare may pay for that, but it won't cover the other assisted living costs.
Although medically necessary, custodial care does not treat any illness; instead, it provides assistance when necessary with activities of daily living. There are six basic ADLs: bathing or showering, clothing oneself, feeding oneself, toileting, personal hygiene and grooming activities and functional mobility. In many cases, the assistance is supervisory in nature: The person is generally capable of handling things herself but needs someone on a stand-by basis just in case. There are scores of instrumental ADLs, including housekeeping, managing medications, preparing meals and shopping.
Medicare and Skilled Nursing Facilities
Medicare Part A covers up to 100 days per year in a skilled nursing facility, or SNF. This is sometimes misunderstood to mean that Medicare will cover the cost of long-term care in general or the cost of staying in an assisted living facility. However, an SNF delivers a level of care much higher than that provided in an assisted living facility and is usually prescribed to facilitate recovery from treatment provided in a hospital. Indeed, to qualify for Medicare's SNF benefit, you must be an inpatient in the hospital for at least three days and -- within 30 days -- enter the SNF to receive services related to the hospital stay.
Other Potential Funding Sources for Assisted Living
Payment options for assisted living are limited. Long-term-care insurance will pay the costs, within predetermined limits, and some employment-related insurance programs, established by unions or employers, will provide some coverage of long-term-care expenses. In many cases, though, people requiring long-term care will find that they must pay the costs from their own resources, including liquidating assets. Veterans' programs are asset based, but some leeway is allowed to reallocate resources. Medicaid is the insurer of last resort for long-term care and is also asset based: Applicants must reduce their assets to a mandated level to qualify, and even then most states' Medicaid programs don't cover assisted living costs in full.