Assisted Living Cost: Key Factors in Determining Your Bill

How much does assisted living cost? Getting to the bottom of this question can be a surprising challenge for families. That’s because much of the price depends on how much — or how little — assistance a senior needs. 

Understanding the three most common cost models in assisted living communities — all-inclusive senior living, a la carte costs based on activities of daily living (ADLs), and tiered pricing structures for different levels of care — provides insight into how costs are calculated. Learn about these pricing options, typical fees, and the top eight questions to ask when touring communities to get an idea of your senior loved one’s monthly bill.

What assisted living base fees typically cover, plus extras

The median monthly cost of assisted living in the U.S. rings in at just over $4,000, according to Genworth’s recent Cost of Care survey. In some areas, the cost is closer to $6,000 a month, while states with a lower cost of living offer rates less than $3,000 a month. However, depending on the pricing model of the providers surveyed, these figures may reflect more of a base fee that doesn’t take into account help with daily needs or other extras.

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Base fees often include these costs of assisted living:

• Rent
• Utilities
• Activities (there may be extra costs for a special outing)
• Three meals a day and snacks
• Weekly housekeeping
• Transportation to and from activities and doctor’s appointments

Base fees fluctuate depending on the size and floor plan of a resident’s apartment, the age of a building, and an area’s cost of living. Studio apartments cost less than one- or two-bedroom apartments, for example.

Typically, residents pay for additional services as well. 

Extra expenses in assisted living may include:

• Help with ADLs like toileting, medication management, and shower assistance
• Escort services for seniors struggling with mobility
• Beauty shop services or other special community services
• Internet
• One-time entrance fee, sometimes called a community or move-in fee, typically between $2,000 and $5,000
• Pet fee and/or pet services
• Laundry

The needs assessment: A key step in determining costs

One reason assisted living costs vary widely is that nearly every resident requires a different amount of care. To identify costs, care providers first assess your loved one’s care requirements. Community representatives may ask preliminary questions of a caregiver or family member. From there, a nurse or executive director will meet with your elderly parent or relative.

Once care needs are determined, a specific pricing discussion is often the next step. However, not all assisted living communities price their services in the same way.

3 assisted living pricing models

Knowing the distinction between all-inclusive, tiered, and a la carte cost structures can reduce confusion about pricing for your loved one’s care.

What to expect with all-inclusive senior living

All-inclusive senior living is just what it sounds like: Costs reflect everything from rent, care, daily assistance, and other essential expenses. This may be an effective option for families who desire a longer-term plan, as costs won’t shift if a senior develops greater needs — as long as the community is appropriately licensed and offers the needed level care.

Tiered cost structures 

Often, pricing is assigned based on progressing levels of care needs. Typically, there are three to six levels outlined. For instance, at Spectrum Retirement Communities, a senior living developer based in Colorado, residents pay for minimal “level one” care, maximum “level five” care, or something in between. This cost is split between a base fee and a services fee. The services fee increases at each level to account for greater needs and more caregivers to help with ADLs. 

Spectrum shares the price of each care level with families. “You know what price you will top out at, but you’re not paying for levels of care you don’t need,” says Spectrum director of resident experience Jeff Arduino.

Like all-inclusive senior living, this model offers slightly more predictable costs than some alternatives.

A la carte pricing for ADLs

Another prevalent pricing model for assisted living assigns costs to ADLs. For example, basic medication management may be $400 a month. Under this model, residents may also pay for help with dressing, feeding, incontinence, and other daily hurdles. Thirty-eight percent of assisted living resident receive help with three or more ADLs, according to a review of assisted living costs and services by researchers at Marshall University.

To help families regulate costs, some communities using this model may bundle ADLs. For instance, assistance with showering and getting dressed could be listed as one cost. Similarly, medication management pricing structures may include five medications as part of the base fee, with an extra charge for six or more, or for injections.

The a la carte model is complex yet customizable. Residents can add or remove services as their needs change.

8 questions to help anticipate the cost of assisted living

Being as prepared and informed as possible can help families avoid surprise costs and sticker shock. Consider the following checklist:

• Is the community all-inclusive? If not, what is included in the base cost?
• Is there a move-in fee or community fee? How much is it, and is it possible to spread out this cost over time?
• Are there any move-in specials or incentives?
• Does the price increase annually?
• How much are various floor plans?
• What’s the maximum amount of care offered?
• What happens if my senior loved one’s care needs change?
• What happens if our family can no longer pay?