Are assisted living facilities required to accept Medicaid?

According to KFF, only a fraction of states require assisted living facilities to accept new Medicaid residents, and most facilities are not obligated to do so. Understanding this is crucial when asking, are assisted living facilities required to accept Medicaid?

Quick Summary

Assisted living facilities are generally not required to accept Medicaid, though many do under specific waiver programs, and policies differ by state. Availability is often limited, and acceptance is not guaranteed, even if a facility participates.

Key Points

• No Federal Mandate: Assisted living facilities are not federally mandated to accept Medicaid, unlike nursing homes.

• State-Specific Policies: Each state administers its own Medicaid program and waivers, leading to significant variations in policies and coverage.

• HCBS Waivers Cover Services: Medicaid typically covers care services in assisted living through HCBS waivers, not room and board.

• Limited Medicaid Beds: Facilities that do participate in Medicaid often limit the number of beds available due to lower reimbursement rates.

• Proactive Research is Key: Families must actively research state policies and contact facilities directly to confirm Medicaid acceptance and availability.

• Resources Available: Organizations like the Area Agency on Aging and legal aid groups can assist with finding facilities and navigating complex regulations.

The Core Difference: State vs. Federal Rules

The fundamental issue is that there is no federal mandate requiring assisted living facilities to accept Medicaid. Unlike nursing homes, which have stricter federal requirements for Medicaid participation, assisted living is regulated primarily at the state level. This critical distinction explains why policies and availability can vary so dramatically depending on location.

Medicaid's Role in Assisted Living

Medicaid, a joint federal and state program, helps low-income individuals pay for healthcare. For assisted living, however, the program's role is often misunderstood. Federal regulations prohibit Medicaid from covering the cost of 'room and board,' which constitutes a large portion of assisted living expenses. Instead, Medicaid may cover specific care services, such as assistance with daily living activities, through state-specific programs.

Home and Community-Based Services (HCBS) Waivers

To cover assisted living services, most states use Home and Community-Based Services (HCBS) waivers. These waivers allow states to provide long-term care services to eligible individuals in their homes or other community settings, like assisted living, to prevent or delay institutionalization in a nursing home. HCBS waivers are not an entitlement, meaning states can limit enrollment and create waiting lists. This limitation directly impacts access for Medicaid recipients, as an eligible individual may still face a long wait for a spot.

Why Some Facilities Limit Medicaid Beds

Even when an assisted living facility participates in a state's Medicaid waiver program, it may still limit the number of beds allocated for Medicaid residents. This is due to several financial factors:

• Lower Reimbursement Rates: Medicaid reimbursement rates are often significantly lower than the rates paid by private-pay residents. To maintain financial viability, facilities often cap the number of Medicaid residents.
• State Budget Constraints: Since states fund their own Medicaid waivers, budget limitations can reduce the number of available slots. This can lead to long waiting lists for eligible seniors.
• Profitability: With higher demand for private-pay spots, some facilities choose to prioritize residents who pay with their own funds, as it is more profitable.

Can a Facility Refuse a Resident Already on Medicaid?

It is illegal for a Medicaid-certified facility to discriminate against a resident who later qualifies for and begins using Medicaid to pay for their care. However, facilities that are not fully Medicaid-certified may attempt to evict a resident who has exhausted their private funds. If a resident's unit is not certified for Medicaid, the facility may legally require them to move to a certified unit or another facility. This is a complex area of law, and seeking legal counsel from an elder law attorney or contacting a long-term care ombudsman is crucial if this situation arises.

Finding a Medicaid-Accepting Facility and Navigating the Process

For families seeking assisted living for a Medicaid-eligible individual, the process requires proactive research and advocacy. Here are the steps to take:

1. Contact State Medicaid Agency: Eligibility and specific waiver programs vary significantly by state. Contact your state's Medicaid office or visit its website for accurate and up-to-date information on programs covering assisted living services.
2. Reach Out to Your Local AAA: The local Area Agency on Aging (AAA) or senior center is a valuable resource. They can provide referrals to facilities that participate in Medicaid and offer other forms of support.
3. Ask Direct Questions: When touring facilities, ask specific questions about their Medicaid policy, including:
   • Do you accept residents using the state's HCBS waiver for assisted living?
   • Do you have a cap on the number of Medicaid residents?
   • Are there any private-pay periods required before a resident can switch to Medicaid?
   • Is there a waiting list for Medicaid-funded residents?
4. Understand the Costs: Remember that even with a Medicaid waiver, the resident is responsible for the room and board portion. The amount they pay for this may be capped by the state based on their income, such as their Supplemental Security Income (SSI).

Comparison of Payment Scenarios

Feature	Private Pay	Medicaid HCBS Waiver	Key Considerations
Acceptance	Widely accepted by most facilities.	Not all facilities accept. Limited slots and waiting lists are common.	Acceptance is a major factor in facility choice and access.
Coverage	Covers both room and board, plus all services.	Covers services only; resident pays for room and board.	Budgeting for room and board is critical for Medicaid recipients.
Financials	Relies on personal funds, savings, and long-term care insurance.	Requires meeting strict state-specific income and asset limits.	Financial eligibility must be established and maintained.
Flexibility	Greater choice of facilities, services, and room types.	Choice is limited to facilities that participate in the waiver program.	Private pay offers more options but higher costs.
Transition	If funds are depleted, a transition to a Medicaid-accepting facility or program may be necessary.	Eligibility review may be annual, requiring continued compliance.	Financial planning is essential to manage long-term care costs.

Other Funding Options

If Medicaid waivers are not a viable option or if the waiting list is too long, several other programs and resources can help cover senior care costs. These include:

• Veterans' Benefits: The Department of Veterans Affairs offers benefits, such as the Aid and Attendance program, to eligible veterans and their surviving spouses.
• Long-Term Care Insurance: Policies purchased in advance can cover the costs of assisted living, though Medicare does not.
• Life Settlements and Reverse Mortgages: These options convert a life insurance policy or home equity into cash, though they involve complex financial decisions with long-term implications.
• PACE Program: The Program of All-Inclusive Care for the Elderly (PACE) is a combined Medicare and Medicaid program in some states that helps seniors stay in their homes or communities.

For more information on these and other financial options, consult the National Institute on Aging's guide on additional funding options.

Conclusion: The Path Forward

To be clear, there is no blanket requirement that assisted living facilities accept Medicaid. The landscape is a patchwork of state-specific programs, particularly HCBS waivers, which cover services but not room and board. This means families must carefully research facilities and understand local regulations. By starting the process early, working with resources like the AAA, and knowing what to ask, it is possible to find suitable care options while navigating the complexities of Medicaid funding.

Frequently Asked Questions

What part of assisted living does Medicaid cover?

Medicaid generally covers the cost of personal care services and medical support within an assisted living facility, such as help with bathing, dressing, and medication management. It does not, however, cover the room and board portion of the expenses, which the resident must pay for separately.

Can an assisted living facility evict a resident for switching to Medicaid?

A facility that is certified to accept Medicaid cannot legally evict a resident for transitioning from private pay to Medicaid. However, if the facility has no Medicaid-certified units or if the resident's specific unit is not certified, they may be required to move to a certified unit or to a different facility that accepts Medicaid.

Why don't all assisted living facilities accept Medicaid?

Many facilities choose not to accept Medicaid because the reimbursement rates offered by state programs are often significantly lower than private-pay rates. This can impact a facility's profitability and ability to offer certain services. Facilities may also have a limited number of beds allocated for Medicaid residents.

Does Medicare cover assisted living?

No, Medicare does not cover the cost of long-term custodial care in an assisted living facility. It may cover eligible short-term stays in a skilled nursing facility after a hospital stay, and it will continue to cover medical services like doctor visits and prescriptions while a person is in assisted living.

How can I find an assisted living facility that accepts Medicaid?

To find a facility that accepts Medicaid, start by contacting your state's Medicaid agency, your local Area Agency on Aging (AAA), or the long-term care ombudsman's office. These resources can provide lists of participating facilities and guidance on the application process.

What are Medicaid waiver programs?

Medicaid waiver programs, or Home and Community-Based Services (HCBS) waivers, are state-run initiatives that allow Medicaid to cover the costs of certain long-term care services provided in a community setting, like an assisted living facility, instead of a nursing home. Eligibility and availability depend on the specific state program.

What should I do if my loved one is private paying and runs out of funds?

If a resident's private funds are depleting, it is crucial to plan for a transition to Medicaid. This involves applying for Medicaid and, if necessary, moving to a different facility that accepts Medicaid. An elder law attorney or a long-term care ombudsman can offer legal guidance during this transition.