Understanding the Important Differences Between Medicaid and Assisted Living Facilities

By Tim Stallings
When an elderly person needs additional help and is looking for a facility, or a catastrophic incident occurs and a loved one can no longer stay at home, most people begin to research long- term care facilities. Many people do not realize there is a difference between that Medicaid views assisted living facilities quite differently from and nursing homes in the eyes of Medicaid. Unfortunately, many people find out about this difference after it is too late. The difference becomes apparent when the elderly person attempts to apply for Medicaid and is either forbidden from applying, or gets denied for benefits.
Many people are familiar with nursing homes. Fewer people are aware that Medicaid pays about forty percent of all long-term care costs in our country (Source: The Henry J. Kaiser Foundation). The cost of long-term care has increased in recent years and it is forecasted to climb in the future. The state of Ohio has recently raised the average monthly private pay rate for a nursing home to $6,114 (Source: The Ohio Department of Job and Family Services). With their expenses for long-term care rising, the state looked for a way to delay people from entering an expensive nursing home by creating the Assisted Living Waiver. This Assisted Living Waiver program allows recipients to stay in a less expensive assisted living facility for a longer period of time, thus saving the state money. Many families experience confusion when navigating the complicated rules for Assisted Living Waiver, which are considerably very different from Nursing Home Medicaid.The first major difference is the start date of coverage. When you apply for Nursing Home Medicaid, the start date is the first day of the month you applied, even if the application is approved two months later. It is retroactive. For the Assisted Living Waiver, however, the start date does not begin until it is approved. For people with very little money, which is a requirement for Medicaid, this could be problematic. Family members may be forced to cover the bill for the months their loved one is awaiting approval.Another major difference is the lack of Medicaid-approved beds. In most nursing homes, every bed is a Medicaid-approved bed, while at assisted living facilities it is common to have as little as three Medicaid beds, if there are any at all. Also, many assisted living facilities have a waiting list several months or even years long for a Medicaid bed. Furthermore, assisted living facilities often require a patient to privately pay for a period of time (generally 24-36 months) before allowing them to occupy a Medicaid-approved bed. When considering different long-term care facilities, it is important to not only ask if they accept Medicaid, but what the parameters are for being in a Medicaid approved-bed.The final major difference is the application process. Medicaid assumes if you are in a nursing home that you need assistance. However, with assisted living facilities, you must prove you need assistance by passing an evaluation by the local Area Agency on Aging. While the assessment generally results in approval for a needy patient, the problem arises because of the significant delay that often occurs between application and assessment, which could be many months. Remember, with the Assisted Living Waiver, the benefits do not start until both the Department of Job and Family Services and the Area Agency on Aging approve the case. The result of the delay is often many months that family members may have to cover the cost of the facility.As you are dealing with the prospect of long-term care, it is imperative to understand these major differences between Nursing Home Medicaid and Assisted Living Medicaid. There is a difference. Ask the right questions. When looking at assisted living facilities, it is not merely enough to ask if they accept Medicaid. Be sure to ask the number of Medicaid beds, the length of the wait list, and the length of private pay required before a resident can apply for Medicaid. By asking these questions and seeking the advice of an attorney who practices elder law, it is possible to avoid some of the unpleasant surprises that can arise by choosing the wrong long-term care facility.”A Lifetime Accumulating Wealth, An Afternoon Preserving It”