Does Medicare Pay for Assisted Living?

🔑 10 Key Takeaways

1. Medicare does not pay for assisted living — period. Medicare does not cover assisted living costs such as room, board, personal care, or custodial services. This applies to Original Medicare, Medicare Advantage, and Medigap.

2. Medicare will cover up to 100 days in a skilled nursing facility. But only after a qualifying 3-day hospital stay, and only for rehabilitation — not long-term custodial care.

3. Medicaid is the primary government payer for assisted living services. Nearly 1 in 5 assisted living residents (18%) depends on Medicaid to pay for daily care services.

4. Three states still offer no Medicaid-funded assisted living. All states but Alabama, Kentucky, and Louisiana provide Medicaid-funded assisted living services.

5. No state will pay for assisted living room and board. Even where Medicaid covers care services, the federal government prohibits using Medicaid funds for housing costs.

6. Georgia has Medicaid waivers for assisted living. Georgia’s CCSP program income limit is $2,901 per month, and it covers personal care, adult day care, and alternative living services.

7. Blue Cross Blue Shield does not cover assisted living. Private health insurance, including BCBS, treats assisted living as custodial (non-medical) care and excludes it from coverage.

8. The average assisted living stay is about 22 months. The median cost of assisted living is $5,900 per month, with the average stay lasting about 22 months, totaling approximately $129,800.

9. Costs vary wildly by state. Mississippi has the lowest assisted living cost at $4,715 per month, while Hawaii ($12,000) and Alaska ($10,819) top the chart.

10. 7 in 10 Americans turning 65 will need long-term care. The federal government estimates that 7 in 10 of those turning age 65 today will need some form of long-term care in their lifetime, and 1 in 5 will need it for more than five years.

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🏥 Medicare Pays Nothing for Assisted Living — But Here’s What It Does Cover Inside the Facility

The confusion stems from a single word: “custodial.” Medicare classifies virtually everything that happens in assisted living — bathing assistance, medication reminders, meal preparation, housekeeping — as custodial care. And custodial care is explicitly excluded from all Medicare coverage.

Medicare won’t cover custodial care, but under certain conditions, it may cover skilled nursing care — care usually provided or supervised by a certified nursing professional or doctor. If you live in an assisted living facility and a doctor orders physical therapy after a fall, Medicare Part B may pay for those therapy sessions. But your rent, meals, and personal aide? Those remain entirely your responsibility.

🏠 Service	❌ Medicare Covers?	📝 Details
Room and board	No	Never covered, regardless of plan type
Personal care (bathing, dressing)	No	Classified as custodial care
Meal preparation	No	Non-medical service
Housekeeping	No	Non-medical service
Medication reminders	No	Not considered skilled care
Doctor visits at the facility	✅ Yes	Covered under Part B as outpatient care
Physical/occupational therapy	✅ Yes	If medically necessary and doctor-prescribed
Durable medical equipment (walkers, etc.)	✅ Yes	Covered under Part B with 20% coinsurance
Hospice care	✅ Yes	Covered under Part A for terminal illness
Home health services	✅ Yes	If homebound and medically necessary

💡 The Medicare Advantage angle most people miss: Some Medicare Advantage plans sometimes help pay for services not offered by Part A and Part B, like personal or custodial care. Certain Special Needs Plans (SNPs) and plans with supplemental benefits may cover limited meal delivery, transportation, or personal care hours. Check your specific MA plan’s Summary of Benefits — the coverage varies enormously between insurers and regions.

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⏰ Medicare Pays for Nursing Homes — But Only for 100 Days (and There’s a Catch)

Families frequently confuse assisted living with skilled nursing facilities, and this confusion costs them dearly. Medicare Part A does cover short-term rehabilitation stays in a skilled nursing facility — but the rules are strict and the clock runs fast.

You must have a qualifying inpatient hospital stay of at least three consecutive days. You must be admitted to the nursing facility within 30 days of leaving the hospital. And a physician must certify that you need daily skilled nursing or therapy care.

📅 Skilled Nursing Facility Day	💲 What You Pay (2026)	💰 What Medicare Pays
Days 1–20	$0	100% of approved costs
Days 21–100	$217/day coinsurance	Everything above $217/day
Days 101+	100% of all costs — you’re on your own	Nothing
Without qualifying hospital stay	100% of all costs	Nothing

💡 The 3-day rule trap: “Observation status” in the hospital doesn’t count toward the 3-day requirement. You can spend four days in a hospital bed, receive round-the-clock care, and still not qualify for SNF coverage because you were classified as “observation” rather than “inpatient.” Always ask your hospital if you’ve been formally admitted as an inpatient.

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💰 How Most Families Actually Pay for Assisted Living (It’s Not What You’d Expect)

The financial reality is sobering. Most assisted living care is paid through a patchwork of personal resources, not government programs. Understanding the typical funding mix helps families plan realistically instead of hoping for coverage that doesn’t exist.

💳 Payment Source	📊 How Commonly Used	📝 Key Details
🟢 Personal savings and retirement funds	Most common	401(k), IRA withdrawals, pension income, Social Security
🟢 Sale of primary residence	Very common	Home equity often represents the largest asset for retirees
🔵 Long-term care insurance	Used by ~7–8% of adults	Must be purchased years before care is needed; premiums rising
🔵 Medicaid HCBS waivers	~18% of residents	Covers care services only, not room and board; waitlists common
🟡 VA Aid and Attendance benefits	Veterans and surviving spouses	Up to ~$2,431/month for qualifying veterans with care needs
🟡 Life insurance conversion	Growing option	Viatical settlements or accelerated death benefits; sell policy for cash
🟡 Reverse mortgage	Homeowners 62+	Converts home equity to cash; loan repaid when home is sold
🔴 Medicare	Almost never	Only covers specific medical services inside the facility
🔴 Private health insurance (BCBS, etc.)	Almost never	Excludes custodial care; same limitation as Medicare

💡 The life insurance trick nobody talks about: Many seniors hold life insurance policies worth $50,000–$250,000 that they no longer need. A life settlement or accelerated death benefit can convert that policy into immediate cash for assisted living costs — often at 20–60% of the death benefit. This single strategy has funded years of care for families who assumed they had no options.

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🗺️ State-by-State: Where Medicaid Covers Assisted Living Services (and Where It Doesn’t)

While no state pays for room and board in assisted living, 47 states plus D.C. now provide some form of Medicaid-funded assisted living care services through Home and Community-Based Services (HCBS) waivers or state plan options. These waivers cover personal care, case management, and sometimes adult day health services — as an alternative to nursing home placement.

The income limit for HCBS waivers is generally 300% of the Federal Benefit Rate, meaning an applicant can have monthly income up to $2,982 in 2026. Asset limits are typically $2,000 for individuals, though some states have higher thresholds.

States with no Medicaid-funded assisted living:

⛔ State	📌 Status	💡 Alternative
Alabama	No assisted living waiver	Nursing Home Medicaid or home-based care only
Kentucky	No assisted living waiver	HCBS waiver for home care only, not assisted living settings
Louisiana	No assisted living waiver	Home-based personal care services available

States with robust Medicaid assisted living programs (selected examples):

✅ State	🏛️ Waiver Program Name	💲 Income Limit (2026)	📌 Notable Feature
Georgia	CCSP / SOURCE (Elderly & Disabled Waiver)	$2,982/month (CCSP)	Covers personal care in licensed personal care homes
California	Assisted Living Waiver (ALW)	Medi-Cal eligible	Extensive program but long waitlist; limited counties
Florida	Statewide Medicaid Managed Care – LTC	300% FBR	Managed care model covering assisted living services
New York	Managed Long-Term Care (MLTC)	Varies by program	No asset limit for MSPs; generous eligibility
Texas	STAR+PLUS HCBS	300% FBR	Covers assisted living in participating facilities
Oregon	State Plan personal care	300% FBR	No asset limit for MSPs; strong community-based system
Arizona	ALTCS (AZ Long Term Care System)	300% FBR	Integrated managed care model
Colorado	EBD (Elderly, Blind, and Disabled) Waiver	300% FBR	Covers assisted living services

💡 The waiting list reality: A limited number of spots are available in HCBS waiver programs, and people can spend several years on a waiting list before they receive care. California’s Assisted Living Waiver, for example, has maintained a substantial waitlist for years. Apply early — even before care is urgently needed.

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🍑 Does Medicare Pay for Assisted Living in Georgia? No — But Here’s What Georgia Medicaid Actually Covers

Georgia families searching for assisted living help have two primary Medicaid waiver programs, both operating under the state’s Elderly and Disabled Waiver Program (EDWP).

The CCSP and SOURCE Programs serve frail elderly and disabled Georgians otherwise eligible under a nursing facility level of care through the provision of case management, adult daycare, alternative living services, personal care, home-delivered meals, and respite care for family caregivers.

🍑 Georgia Program	👤 Who Qualifies	💲 2026 Income Limit (Single)	💰 Asset Limit	🏠 Where Care Is Provided
CCSP	Elderly (65+) or physically disabled; nursing home level of care needed	$2,982/month	$2,000	Home, personal care home (assisted living), adult day care
SOURCE	SSI/Medicaid recipients; elderly or disabled	$994/month	$2,000	Home, personal care home (assisted living)

Residents pay the personal care home $768 per month — a rate established by the Georgia Department of Human Services, Division of Aging, as of January 1, 2026 — out of their monthly SSI check.

💡 How to apply in Georgia: Contact your local Area Agency on Aging through the Georgia Aging and Disability Resource Connection (ADRC). You can also call Georgia Cares at 866-552-4464. It typically takes 2–4 months from start to finish for a client to be enrolled in CCSP, and clients can move into a personal care home while their application processes.

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🩺 Does Blue Cross Blue Shield Cover Assisted Living? (And Other Private Insurance Realities)

The answer is no. Blue Cross Blue Shield — along with Aetna, UnitedHealthcare, Cigna, Humana, and virtually every other private health insurer — does not cover assisted living costs. Private health insurance follows the same logic as Medicare: assisted living is custodial care, not medical care, and falls outside coverage boundaries.

🏢 Insurance Type	🏠 Covers Assisted Living?	📋 What It Might Cover
Blue Cross Blue Shield	❌ No	Doctor visits, prescriptions, and medical procedures regardless of where you live
Medicare Original (A + B)	❌ No	Skilled nursing (100 days), home health, hospice, medical services only
Medicare Advantage (Part C)	❌ Generally no	Some plans offer limited supplemental benefits (meals, transportation)
Medigap	❌ No	Helps with Medicare cost-sharing only; no custodial care coverage
Long-term care insurance	✅ Yes	Specifically designed for assisted living; must be purchased in advance
Medicaid HCBS waivers	✅ Partial	Care services only; room and board excluded

💡 The only insurance that truly covers assisted living is long-term care insurance — a product you must buy years before you need it (ideally in your 50s). Premiums have risen sharply, and many insurers have exited the market. But for those who hold policies, benefits typically range from $150–$300/day, covering both assisted living and nursing home care.

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📊 Assisted Living Costs by State: The Full 2026 Price Map

Location is arguably the single biggest factor driving assisted living costs. The difference between the cheapest and most expensive states can exceed $7,000 per month — nearly $90,000 per year.

🏷️ Cost Range	📍 States	💲 Approximate Monthly Cost
💚 Most affordable	Mississippi, Alabama, Georgia, Missouri, Arkansas, Oklahoma, Utah	$3,500–$4,800
🟢 Below average	Texas, Tennessee, North Carolina, South Carolina, Ohio, Indiana, Kansas	$4,000–$5,200
🟡 Near national median	Florida, Virginia, Illinois, Michigan, Pennsylvania, Colorado, Arizona	$5,000–$6,500
🟠 Above average	California, Washington, Oregon, Minnesota, Maryland, New Jersey	$6,000–$8,000
🔴 Most expensive	Massachusetts, Connecticut, New York, New Hampshire, D.C., Alaska, Hawaii	$7,500–$12,000+

The average cost of assisted living in 2026 is approximately $5,900 per month, or $70,800 annually.

💡 The “move to save” strategy: Some families relocate aging parents to lower-cost states specifically because of assisted living affordability. A senior paying $8,500/month in Massachusetts could receive comparable or better care in Georgia or North Carolina for under $4,500/month — saving over $48,000 annually. Just remember that Medicaid eligibility transfers require establishing residency in the new state.

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🆘 How to Pay for Assisted Living With No Money: Real Options That Actually Work

When savings are depleted and income is limited, the situation feels desperate — but options still exist. The key is knowing which programs to apply for and in what order.

🔧 Strategy	💡 How It Works	⚠️ What to Watch Out For
Apply for Medicaid HCBS waiver	Covers care services in assisted living; apply through your state’s Medicaid agency	Waitlists can be long; room and board still your responsibility
VA Aid and Attendance	Monthly pension benefit for qualifying veterans and surviving spouses	Requires wartime service; asset limits apply; can take months to process
State-funded assistance programs	Many states have additional programs beyond Medicaid for low-income seniors	Varies enormously; contact your Area Agency on Aging
Medicaid spend-down	Spend excess assets on allowable items (home repairs, prepaid funeral, medical equipment) to qualify	Must follow strict rules; 60-month lookback in most states
Shared living / roommate options	Some facilities offer semi-private rooms at reduced rates	Limited availability; privacy trade-off
Nonprofit and faith-based facilities	Often offer lower rates or sliding-scale fees	May have religious requirements or limited openings
Bridge loans against home equity	Short-term loan to cover care while home sells	Interest accrues; timing risk if home takes long to sell

💡 The Medicaid planning professional: Families who are over-income or over-asset for Medicaid but cannot afford assisted living should consult a Certified Medicaid Planner or elder law attorney. Legal strategies — like Medicaid-compliant annuities, spousal protections, and qualified income trusts — can help people become eligible without impoverishing a surviving spouse.

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❓ Frequently Asked Questions

How is most assisted living care usually paid for?

The majority of assisted living is funded through personal resources — retirement savings, Social Security income, pension payments, and proceeds from selling a home. About 18% of residents rely on Medicaid waiver programs for care services. Long-term care insurance covers a small percentage, and VA benefits assist qualifying veterans. Medicare pays nothing toward the actual cost of living in the facility.

How long does Medicare pay for nursing home care?

Medicare Part A covers up to 100 days in a skilled nursing facility — not a nursing home for long-term custodial care. The first 20 days are fully covered with $0 coinsurance. Days 21 through 100 require a $217/day coinsurance payment in 2026. After day 100, Medicare coverage ends completely. You must have had a qualifying 3-day inpatient hospital stay and need skilled nursing or rehabilitation services to qualify.

Does Medicare pay for assisted living in Georgia?

No. Medicare does not cover assisted living in any state, including Georgia. However, Georgia Medicaid offers the CCSP and SOURCE programs through its Elderly and Disabled Waiver Program. CCSP provides support for seniors in their home, in assisted living (personal care home), and adult day care, with an income limit of $2,982/month. Georgia residents should contact their local Area Agency on Aging to begin the application process.

Does Blue Cross cover assisted living?

No. Blue Cross Blue Shield and other private health insurers do not cover assisted living because it’s classified as custodial rather than medical care. Your BCBS plan will continue to pay for doctor visits, prescriptions, and medical procedures you receive while living in an assisted living facility — but the facility costs themselves are excluded.

How much does assisted living cost on average?

Assisted living community costs increased by 10% to a national median of $70,800 per year according to the most recent Genworth/CareScout data. Monthly costs range from roughly $3,500 in the most affordable southern states to over $12,000 in Hawaii and Alaska. The national median sits around $5,900–$6,300 per month depending on the data source and methodology.

Can I use my spouse’s income to pay for my assisted living?

Yes, and Medicaid has specific protections for this. If one spouse needs Medicaid-funded assisted living, the Community Spouse Resource Allowance (CSRA) allows the healthy spouse to keep a significant portion of the couple’s assets — up to $162,660 in many states for 2026. A Monthly Maintenance Needs Allowance also protects some of the institutionalized spouse’s income for the community spouse’s living expenses.

What if my state doesn’t offer Medicaid-funded assisted living?

If you live in Alabama, Kentucky, or Louisiana — the three states without Medicaid-funded assisted living services — your primary options are Nursing Home Medicaid (which is an entitlement in all states), home-based HCBS waiver services, VA benefits if eligible, or private payment. Some families in these states choose to establish residency in a neighboring state with better waiver coverage, though this requires careful planning and timing.

What is the difference between assisted living and a nursing home?

Assisted living is for people who can live semi-independently but need help with daily activities like bathing, dressing, and medication management. Nursing homes provide 24/7 skilled medical care, including IV therapy, wound care, and rehabilitation. The median cost of nursing home care for a semi-private room is approximately $9,000–$10,000/month — significantly more than assisted living — reflecting the higher level of medical staffing and services.

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The bottom line: Medicare’s refusal to cover assisted living is one of the most consequential gaps in American healthcare. With 10,000 baby boomers turning 65 every day and 70% of them eventually needing long-term care, the financial burden falls almost entirely on families. Start planning early, apply for every program you might qualify for, and don’t assume that any single source — whether Medicare, Medicaid, or private insurance — will cover the full cost. The families who fare best are the ones who build a funding strategy combining multiple sources, consult elder law professionals before assets run out, and apply for Medicaid waivers months or years before care becomes urgent.