There are a variety of Assisted Living Payment Options and ways of paying for senior housing and long-term care; some of the most frequently accessed sources are summarized here.
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Most people pay for independent living, assisted living and CCRCs out of their own pockets with private funds. There are some states which accept Medicaid for assisted living (Colorado is one of them), but there is currently no program on the federal level, and private funds still account for approximately 90 percent of assisted living payments. Cost range between $1,500.00 on a low end, to upwards of $5,000 to $6,000.00 on the high end. About one-third of long-term care at nursing facilities is paid with private funds.
What is Long-Term Care Insurance?
Long-term care insurance covers the costs of long-term care in certain types of care facilities, including most Assisted Living Facilities (AFC's), depending upon the policy. Policies may cover a stay in licensed nursing facilities and home health care. Often, those persons with a sizable asset base may wish to purchase a policy to protect these assets.
Where can Long-Term Care Insurance by purchased?
Long-term care policies are sold by private insurance companies (not all insurance firms offer this type), through agents, mail and various organizations. Another source is employers who offer this coverage as a benefit to employees and their parents. An insurance company must be licensed in your state to sell long-term care insurance.
How Much do Policies Cost?
Premiums for Long-Term Care Insurance are based on the age of the person at the time of purchase, the benefit amount, the benefit time period, elimination or deducible, and special options (i.e. inflation adjustment, non-forfeiture benefits and spousal discounts).
What is Medicaid?
As defined in Title XIX of the Social Security Act, Medicaid is a joint Federal-State program which pays for medical services to eligible needy and vulnerable families and individuals. The state must offer basic services in order to receive Federal matching funds and the Medicaid program varies from state to state.
Qualifications for Medicaid in Colorado
Qualifying for Home and Community Based Services
Home and Community Based Services (HCBS) is a Medicaid program that pays for help in the home, adult day care, and assisted living. It serves elderly and blind or disabled individuals who require Long-term care services. The intent is to serve this population in a home or appropriate community setting that is more cost effective than a nursing home. The individual must have the same medical level of need as one who requires nursing home care. Services are arranged by the Single Entry Point (SEP) agency that assigns a case manager to coordinate and monitor services. HCBS does not provide 24-hour help. The cost of all combined services must be less than Medicaid's payment for nursing home care. There is a yearly cap on the amount the state spends on an individual, usually a third of comparable nursing homes costs.
Services Available Under HCBS
Once accepted for HCBS, the following services are paid for by Medicaid to the extent they are part of the individual's care plan:
Assisted Living in an Alternate Care Facility (ACF). This means it is a licensed Medicaid facility.
NOTE: Assisted living costs are only covered by Medicaid if the individual is in a Medicaid licensed Alternate Care Facility (ACF). This may be a small home or a larger assisted living facility. Individuals who live in a non-Medicaid assisted living facility, are not eligible for HCBS benefits. The individual must move to a Medicaid assisted living facility in order to have Medicaid pay for this benefit.
Three requirements must be met for an individual to be eligible for Home and Community Based Services. The individual must be eligible in all three categories:
An individual applying for HCBS must be a citizen of the United States either by birth or naturalization or a legal alien living in the United States prior to August 22, 1996. Entry after that date requires a 5-year continuous period of residence in the United States. An applicant must be a resident of Colorado. There is no length of state residency requirement. The individual can apply for Medicaid the first day in Colorado, provided there is the intent to remain in Colorado. The application process cannot begin before the individual arrives in Colorado, except for obtaining medical information for the ULTC-100.
As for nursing home Medicaid, a physician and a discharge planner, social worker, or nurse must evaluate the individual’s need for HCBS by using the ULTC-100 assessment form that requires approval by the Peer Review Organization (PRO). The PRO consists of a group of physicians and health care professionals contracted by the state government to review Medicare and Medicaid systems.
The ULTC-100 XE "ULTC-100: for HCBS" assessment form is used to determine that the individual qualifies for nursing home care, which also entitles him/her to HCBS services. The assessment may be done in the hospital, nursing home, or in the individual’s own home. This assessment is completed by a social worker or case manager, with one part completed by the individual’s physician. A second assessment, the MINS (Most in Need of Service) screen is completed for HCBS eligibility, which further measures mobility, confusion, bladder and bowel incontinence. This is usually done at the same time as the ULTC-100 assessment.
Starting July 1, 2003 Part I and Part II of the application must be completed and sent in to the county Department of Human Services before the ULTC-100 or a home assessment can be done by the Single Entry Point agency.
The gross income of the applicant must be below $1,656 a month (2003). If the income is over this amount, an Income Trust must be set up. The rules for an Income Trust for an individual on HCBS are different than those for an individual on nursing home Medicaid. This is discussed in Chapter Six.
The non-exempt resources of the applicant must be below $2,000. After July 1, 1999 a couple is allowed the same Community Spouse Resource Allowance (CSRA) as that for nursing home applicants. See section on Qualifying for Nursing Home Benefits for resource information.
WHERE TO APPLY
All applications for Home and Community Based Services are made through the Single Entry Point If the individual is at home an application for Home and Community Based Services is made through the Single Entry Point (SEP) agency in the county where the home is located.
If the individual is in the hospital an application for Home and Community Based Services is made through the Single Entry Point agency in the county where the individual normally resides, although the hospital may be in a different county. Hospitalization does not cause an individual to lose his/her county of residence.
The application for Home and Community Based Services begins with the Single Entry Point Agency (SEP). The referral can be made to the SEP by a family member, social worker, hospital discharge planner, or anyone involved in the care of the applicant. Once the referral is made, the SEP will see that Part I and Part II of the application is sent to the applicant or the family.
Once Part II is completed with documentation and is sent to the county department, a case manager will come to the individual’s home or to the hospital. The ULTC-100 and MINS assessments X are done at this time, using information obtained from the applicant, family members, or hospital personnel. A family member should be present at this appointment to supplement any information about the applicant’s condition. A physician must fill out a page of the ULTC-100. Once these assessments are completed they are sent to the Peer Review Organization (PRO) for approval. Once approved by the PRO, Part II of the Medicaid application will be processed by the county Department of Human Services. An appointment may be set up with an eligibility technician at the county department for financial eligibility. The application process can take two to three months before approval. Services cannot begin until the application is approved.
There is no “Medicaid Pending” for Home and Community Based Services. Medicaid begins on the date the application is approved. There is no back dating for HCBS services. This is especially important for those persons who are applying for Medicaid in assisted living facilities.
They will have to pay the full private pay amount to the facility prior to Medicaid approval of their application. There is no reimbursement for costs paid during the waiting period. When applying for assisted living, the applicant may want to pay the assisted living facility for at least two months in advance while the application is in process, spending down funds to the acceptable amount, and insuring payment coverage until Medicaid is approved.
What is Medicare?
As defined in Title XVIII of the Social Security Act, Medicare ("Health Insurance for the Aged and Disabled") is a Federal health insurance program for aged (65+) and certain disabilities (e.g. persons with end-stage renal disease (ESRD) who require dialysis or a kidney transplant), regardless of income.
We do not discuss Medicare here because it does not cover any type of Assisted Living Programs. Click here to learn more about what Medicare does cover.