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.
The admissions people at the assisted living facility have asked. “Are you going to be applying for Medicaid?” They’re curious. They want to be paid. 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.
Clients are constantly confused by this (as are many workers in assisted living facilities who should know better). You need to know the differences if someone you care for is in an assisted living facility.
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. If you want to read about Medicaid in a skilled nursing home, read North Carolina Medicaid Nursing Home Rules: The English Translation.
Generally, 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 comes in.
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 freight.”
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 the transfer.
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.
Estate Recovery
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 them at the assisted living facility 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.”
Questions? Just ask in the box below.
Good work Bob. I knew the income rules were harsh when it comes to SA but you have reinforced this.
Do not know any top notch paralegals that desire to commute to the Queen City.
Best regards,
Monroe Pannell
HI Bob, Another great explanation of your part! I would also recommend that when considering different Assisted Living Communities (with expectations that SA might be required if Mom / Dads resources ($$$$) are limited), ask if they will accept SA / Medicaid. Many will acknowledge they will accept SA / Medicaid after resident has Private Paid for a certain number of months. It is important to get this in writing!
If person receives $550 SS, $550 retirement and VA disability person, how is the qualification figured? What happens if assets exceed over $2000 and there are no family members to transfer assets to?
If assets are over $2,000 the person won’t qualify until they have less than $2,000 assets.
As far as income, how much VA disability does he or she receive?
My husband receives approximately $1,650 per month (gross) in SSDI due to Primary Progressive Aphasia & Frontotemporal Dementia. So you are saying there is absolutely no way to reduce that gross amount to qualify for SA?
Also, do all ALFs and/or SCUs accept SA or are there designated facilities?
If your husband’s gross income is $1,650 per month he is not eligible for SA. Sorry.
Many/most ALFs accept SA; some don’t.
If his gross income is over $1,580.50 he won’t qualify. Sorry.
Explain about VA benefits??????
Thank you for this explanation! This has been very helpful to me! I’ve tried to search to find out about this before we apply and just to be prepared. And I couldn’t find it ANYWHERE!
Thank you!
What services need to be offered to be considered SCU certified? My dad is in a new Assisted Living Facility and they knew up front that he would eventually be Medicaid. He is now within the $2,000 limit and we need to shop fast.
First, keep in mind that at the assisted living facility it is not Medicaid, but Special Assistance. If the facility is licensed to provide special care unit services they should simply tell you they are so licensed and that they have a special care unit.
My uncle has a chronic disease and he needs help all the time to take his medication. I like how you explain that a nursing home can assist seniors with these types of diseases. I will talk to my dad to see if it would be a good idea to take my uncle to one of those facilities.
Thank you for the informatve articles. We applied for a VA widow’s pension for my mother in June 2018. In September 2019 we still had not received an answer from the VA and my mother needed to move into an assisted living facility. We applied for and received special assistance for her. In April 2020 she was moved to the SCU in the AL facility. Also in April 2020 the VA widow’s pension was approved and we received a lump sum of $25,000 +1250/month. After being so frugal for so long, we now find ouselves in a bind to spend down the money by November 16, 2020. Plus we will have trouble in the future keeping her income below the $2000 limit. What is the monthly income cap for SCU special assistance for someone with a VA pension? Thanks for your assistance. Also what large ticket items could we purchase with the VA money to spend it down?
I am a bit confused. If she received the $25,000 lump sum it should have been considered an asset by SA on the first of the following month (May 1, 2020). I’m not sure how November 16 plays in.
You are confusing the SA income limit (which for your mother is $1,58.50 gross) with the asset limit ($2,000). DSS may try to say that the VA pension puts her over the SA income limit, but it DOES NOT. VA monthly pension payments are not countable — that is a battle I have won!
Anyone in the family on disability and under 65?
Thank you for the reply. We know now that my mother was over the limit May 1, but we didn’t understand how that worked, especially with retroactive VA funds. We truly had no idea we would ever see any money from the VA. My mother was 95 when we applied. My sister navigated the dhss and VA systems the best that she could.
October 2020 was time for the SA annual review and that’s when we received a notice from the county social services that we were over the limit and had to show how we would spend down the funds. We replied to the notice they sent that we needed more time. They gave us until November 16 to show how we would spend the money.
My sister was permanently disabled when she was 55. She is now 69.
If your sister was on SS disability (they switched her over to retirement when she hit normal retirement age) and you can prove it, then transfer the funds to her.
SA-3205 E provides: Transfers to the A/R’s Blind/Disabled Child
Any resource transferred to a/r’s blind/disabled child of any age, in addition to the homesite,
is allowable. The blind/disabled child must be determined blind/disabled by SSA.
What about the situation where my client has no income, would otherwise qualify for SSI only, she has not worked enough for SSRI or SSD, but her husband is disabled and receives too much which makes their income over for SSA purposes. Because his income is too high she di6es not receive her SSI money part but does receive Medicaid. They live off his SSD of $1387.00.
Issue I’m having is that she is approved for SA for memory care, but the facility is saying they can’t take her because she has no income of her own and they would not receive their full amount from her if placed?
Does she become separated from her spouse at placement and once in a facility we could apply for her SSI income to get them money?
Ever run across this issue? If so, what to do?
Unfortunately, the facility MAY require additional funds even though she qualifies for SA. Not all facilities do this, and it might be worth shopping around. Yes, she becomes separated from spouse at placement. Deeming applies only if they are living together in the same household. You mentioned “client” so I assume you’re some sort of professional; if so, here’s a citation: 42 CFR § 416.1160(a)(1) (which says: “If you live in the same household with your ineligible spouse, we look at your spouse’s income to decide whether we must deem some of it to you. We do this because we expect your spouse to use some of his or her income to take care of some of your needs.”)
My 74 year old Aunt has “nonspecified dementia and bipolar” diagnosis. Her Gross income is $1404. She has spent down her retirement savings to pay for assisted living facility over 4 years. Now, Medicaid says her income is still too much to qualify. We cannot afford to pay the $3100/mo to keep her in her current facility without assistance. Do you have suggestions? Would SA apply in this case?
AS the article explains, Medicaid has nothing to do with the assisted living facility. So her income is not too much for Medicaid. It IS too much for SA in the general assisted living facility population, but if she moved to memory care (because of her dementia) she’d be OK because her gross income is less that $1,580.50.