Make the best senior care decision
If you’re caring for a loved one with Alzheimer’s disease or another type of dementia, you may be considering memory care. Whether you’re looking for in-home or assisted living community-based help, memory care is designed to keep seniors experiencing cognitive decline healthy, safe, and engaged.
Our free tool provides options, advice, and next steps based on your unique situation.
However, when considering how to pay for assisted living or memory care, the price tag can feel overwhelming. In fact, the median cost of memory care in 2021 was $5,430, according to A Place for Mom’s most recent community survey.
Fortunately, a number of memory care financial assistance options are available. From federal and state-funded programs to veterans benefits, nonprofit organizations, loans, and tax credits, we’ll cover several funding sources that can offset the cost of memory care help.
In this article:
Medicare is a federal health insurance program available to all U.S. adults over the age of 65. The total number of those enrolled in the program sat just shy of 64 million Americans in October 2021, according to the Centers for Medicare and Medicaid Services (CMS).
Medicare does offer some memory care financial assistance, but there are limitations on when it will pay for care and how much of the cost it will cover. Benefits are strictly for medical needs. The tasks required to provide personal care for an individual with Alzheimer’s or dementia — including supervision and assistance with activities of daily living (ADLs) — are classified as nonmedical, and thus are not eligible for financial coverage.
Some memory care services that are considered medical needs and are covered by Medicare include:
Medicare Advantage plans are offered through private, Medicare-approved companies. They include the same benefits listed above, as well as potential benefits that can be exceptionally advantageous for individuals with Alzheimer’s or other types of dementia.
These potential benefits may cover or provide:
Additionally, Medicare Advantage plans include special needs plans (SNPs). These can provide benefits for specific medical concerns or chronic conditions. Individuals considering long-term nursing care — whether in their home or an assisted living facility — may qualify for an SNP.
Other persons who may qualify for an SNP include those receiving Medicare benefits and Medicaid services, or those with any of the following chronic conditions:
Medicaid is funded partially by the state and federal government, and it is a health insurance program for those with limited income or financial resources. Individuals diagnosed with Alzheimer’s or another type of dementia may qualify for Medicaid benefits if they are unable or have a limited ability to work.
Medicaid has broader benefits than Medicare for individuals with Alzheimer’s or another type of dementia. While Medicaid, like Medicare, doesn’t cover the cost of personal care, plans may pay for:
Medicaid assistance varies on a state-by-state basis, and, in order to utilize these benefits, assisted living and memory care providers must participate in the program, and their participation is not guaranteed. Only about 50% of assisted living communities are Medicaid approved. When it comes to Medicaid benefits for dementia and Alzheimer’s care, it’s important to recognize the different Medicaid programs available.
Institutional long-term care is a Medicaid program for individuals who need nursing or long-term care in a residential facility. These facilities are required to be licensed and certified by the state, and they should primarily provide long-term care, skilled nursing, and rehabilitation.
This program covers a range of inpatient and comprehensive services as institutional benefits. These services include:
Home and community-based services (HCBS) are person-centered care provided in an individual’s home or community. HCBS programs are designed to help individuals stay in their homes, rather than moving into an institutional setting or nursing home.
These programs can offer a variety of medical and human services, which may include:
Our free tool provides options, advice, and next steps based on your unique situation.
The Department of Veterans Affairs (VA) offers a variety of benefits that can help senior veterans cover the cost of care. VA health care programs offer medical benefits that may include services beneficial for people experiencing dementia or cognitive decline. The VA may provide ongoing assistance for eligible veterans from the time of a dementia diagnosis through the disease’s terminal stage.
The VA offers a number of different programs that can help cover memory care costs, including those listed below.
The Veteran-Directed Care (VDC) program provides a monthly budget to veterans or their caregivers. The budget covers the costs of:
Unlike traditional VA services, the VDC puts veterans at the center of their long-term care service. Under the VDC, veterans can:
Aid and Attendance benefits give financial assistance to low-income veterans or surviving spouses. The veteran or surviving spouse must meet at least one of the following conditions to qualify:
The Aid and Attendance benefit is an additional monetary amount that can be added to a VA pension. The benefit helps cover the cost of:
The VA Dependent Parent Benefit is a needs-based cash benefit, and it is available for veterans caring for a parent with Alzheimer’s or another type of dementia. The parent must be financially dependent on the veteran for care. This benefit:
State Veterans Homes are long-term care facilities that are certified by and receive funding from the VA, but they are run by individual states. The types of care provided in these homes can include:
A home is often a senior’s largest asset or investment and can be used as a source of funds for dementia care. Here are a few ways you can use you or your loved one’s home to pay for memory care:
Life insurance plans may be able to cover memory care costs. A policy holder may be able to sell their policy to a third party and use the proceeds to fund assisted living. Or, a life insurance policy may be “surrendered” to the insurance company for its cash value. However, using life insurance to fund memory care involves relinquishing policy ownership and not receiving benefits upon death.
Most families cover the cost of memory care with personal assets. A senior may have saved for retirement throughout their career, or they may have a pension. Adult children also frequently contribute to a parent’s cost of care. Some assets typically used to fund the cost of memory care include:
Some states have funds available to provide financial assistance to individuals with Alzheimer’s or another type of dementia. Some of these programs can require a formal dementia diagnosis, while others can be for a variety of age-related care needs.
It’s worth noting that, as state programs, these operate with a limited availability of funds and are available to a limited number of people. State-based programs typically assist caregivers by paying for adult day care or in-home respite care.
Our advisors help 300,000 families each year find the right senior care for their loved ones.
If the previous examples given do not apply to your unique situation, there are additional resources available to provide memory care help and financial assistance. Although Medicare, Medicaid, and VA programs can be excellent options for memory care financial assistance, there are other options that can help with the costs of long-term care.
Some of these other options include:
As the cost of memory care services increases, understanding the options available to you and your loved one can be instrumental in determining how much you pay. Our free, local Senior Living Advisors can help you with any questions you have about memory care or finding financial resources to cover the associated costs.
Sources
Alzheimer’s Association.Alzheimer’s and dementia facts and figures.
Centers for Medicare & Medicaid Services. (2021, December 21). CMS releases latest enrollment figures for Medicare, Medicaid, and Children’s Health Insurance Program (CHIP).
Dementia Care Central. (2019, November 4). Getting financial help for dementia and Alzheimer’s care.
Dementia Care Central. (2020, August 20). Respite care for Alzheimer’s and dementia caregivers.
Dementia Care Central. (2022, January 21). Medicaid benefits for dementia and Alzheimer’s care: at home, in memory care and nursing homes.
Geller, H. (2019, December 16). How to pay for assisted living or memory care. ElderCare Alliance.
IRS. (2021). Publication 524 (2021), credit for the elderly or the disabled.
Medicaid.gov. Nursing facilities.
Paying for Senior Care. (2020, August 14). Medicaid and assisted living: state by state benefits and eligibility.
White, D. (2021, June 14). How much does memory care cost?. Consumer Affairs.
Veteran Aid.org. Alzheimer’s and dementia care for veterans.
The information contained in this article is for informational purposes only and is not intended to constitute medical, legal or financial advice or create a professional relationship between A Place for Mom and the reader. Always seek the advice of your health care provider, attorney or financial advisor with respect to any particular matter and do not act or refrain from acting on the basis of anything you have read on this site. Links to third-party websites are only for the convenience of the reader; A Place for Mom does recommend or endorse the contents of the third-party sites.
The information contained in this article is for informational purposes only and is not intended to constitute medical, legal or financial advice or create a professional relationship between A Place for Mom and the reader. Always seek the advice of your health care provider, attorney or financial advisor with respect to any particular matter and do not act or refrain from acting on the basis of anything you have read on this site. Links to third-party websites are only for the convenience of the reader; A Place for Mom does not recommend or endorse the contents of the third-party sites.