Medicaid in an Assisted Living Facility? Think again!
You’ve been looking at assisted living facilities for Mom, who simply can’t be left home
alone anymore and who cannot afford round the clock in-home care.
Someone may have asked. “Are you going to be applying for Medicaid?” Technically, it
is also the wrong question to ask.
The name of the program is State/County Special Assistance for Adults. Call it “Special
Assistance.” Now burn this into a plaque somewhere: “Special Assistance is NOT
Medicaid.” The rules can be very different in a few critical areas.
First, a bit of background.
Levels of Care
Do not confuse an assisted living facility or adult care home with a skilled nursing
facility. They are two different facilities with different rules and different programs.
A skilled nursing facility (what most of us call a “nursing home”) is a place for folks who
are (usually) nonambulatory and with some chronic medical condition that requires
skilled care on a daily basis. Think of it as a “step down” from a hospital meant for
longer term stays. In the industry we call these “SNFs” (skilled nursing facilities).
Do not confuse these facilities with assisted living facilities. An assisted living facility is a
facility for frail individuals who need assistance with a number of what we call activities
of daily living (ADLs). Think assistance with bathing and toileting, mobility, personal
hygiene, feeding. In the industry we call these ALFs (assisted living facilities).
To add to the confusion, some ALFs have special units usually called “Memory Care” or
some similar variation (the bureaucratic term is “special care unit” or “SCU”). A special
care unit is a separate area of an ALF with locked doors and a higher level of
supervision for residents with various forms of dementia. Care in a SCU is NOT skilled
nursing. It is still part of an ALF.
Paying for It
Generally, SNFs are charging around $10,000 a month. As we’ll discuss in a moment,
Medicaid will pay for most care in most SNFs for eligible individuals. At 10 grand a
month, most folks are keenly interested in whether Mom will qualify for Medicaid. But
Mom is in an assisted living facility, so forget about it.
ALFs run around $3,500 to $4,000 a month for the general areas and perhaps $6,000 to
$8,000 for a SCU or Memory Care Unit (those locks and extra supervision get
expensive). Medicaid does NOT pay for ALF room and board and most incidental
services. They simply aren’t considered “medical.” That’s where Special Assistance
If Mom is in an assisted living facility and IF she qualifies for SA, there will be a cap on
how much they can charge for room and board (basically her income plus whatever the
state pays them). Also, if Mom qualifies for SA, she MIGHT qualify to receive some
additional personal care services paid for by Medicaid.
Did I just say MEDICAID!? Yes, but it is not the same as nursing home Medicaid. In this
case it won’t be very much – perhaps a few hundred or a thousand bucks. Plus, unlike
the SNF which has to be happy with the Medicaid payment as complete payment, the
ALF might ask for a little bit extra from the family. But at least they aren’t paying “full
Special Assistance Background
Did I already write that Special Assistance is NOT Medicaid? Special Assistance
actually borrows most of the rules that apply to the federal Social Security Supplemental
Security Income (SSI) program. There are some significant differences from Medicaid.
Special Assistance Transfer Rules
SA has transfer rules, as does Medicaid. But Medicaid looks at any transfer made within
5 years of applying, divides the value of the transfer by $6,810, and uses that number to
establish a penalty period in months that Medicaid will not pay for the SNF – beginning
when the person is finally in the SNF and otherwise eligible for Medicaid.
SA looks at any transfer made within 3 years. The value of the transfer is divided by
$2,000, and the result is used to calculate a number of months the individual is ineligible
for SA. Unlike Medicaid, the transfer penalty begins the first day of the month following
Special Assistance Asset Rules
These are very similar to Medicaid. A $2,000 countable asset cap. Some differences in
real property rules.
A huge difference from Medicaid: SA does not count assets in the name of a spouse! If
Mom qualifies for SA, Dad could be a millionaire.
Special Assistance Income Rules
This is VERY different from Medicaid and causes, perhaps, the most confusion. Under
Medicaid, if income is less than the SNF’s private pay rate, there is no problem. Most of
my clients do not have income exceeding seven or eight thou a month.
Under SA, when qualifying for the general area of an ALF (not the SCU) the gross
income cap is just $1,247.50 a month. That’s GROSS income. Count Social Security
BEFORE deductions for Medicare or other insurance. Count all other income from any
source (well, except VA benefits . . . but that’s another story). If income is a penny over
$1,247.50, then forget about general SA.
However, if Mom has dementia and needs to be in the Memory Care unit, the cap is
$1,580.50. That helps some, I guess.
Here is how crazy the rules are. Remember Mom with millionaire Dad? She is drawing
just $500 a month Social Security. All assets are transferred to Dad. SA only looks at
Mom. She is qualified for SA.
Now think of Mom, who is widowed. She has just a few thousand dollars in countable
assets. Her gross income is $1,248. Too bad. She doesn’t qualify. After years of
working around this issue, I still have trouble accepting it.
SA has none! Estate recovery is a Medicaid issue. Did I already write that Special
Assistance is NOT Medicaid?
Now, be careful, if Mom was on SA and managed to receive a few personal care
services paid by Medicaid there might be estate recovery when she dies – but we’re
talking perhaps a few hundred dollars a month.
I hope this helps clear up some confusion. Now you can amaze people when they ask,
“Are you going to apply for Medicaid.” You can give them a puzzled look, then a
knowing grin, and say, “No, I’m not. But I will be applying for Special Assistance.”
Bob Mason, owner of Mason Law, PC, is a board certified elder law and special needs law attorney with offices in Charlotte and Asheboro. www.masonlawpc.com