Paying for Senior Living with No Money

Ways to Pay for Senior Living if You Have No Money

Average Cost of Assisted Living

Assisted living facilities are for seniors who need help with activities of daily living (ADLs) but don’t need the extensive medical services and 24/7 supervision you’d find at a nursing home. Living full-time in an assisted living facility has an estimated median cost of $10,024 per month in 2024. Seniors can save a little by opting for a semiprivate room, which has an estimated median cost of $8,929 per month. Just like assisted living, nursing home costs will vary significantly by state and the chosen home.

How to Pay for Assisted Living With No Money

If you do not have the monthly income to pay for an assisted living community, you can draw from other sources. However, Medicare is not one of them. Medicare does not provide any coverage for assisted living. We’ll explore your other options below.

Medicaid Coverage

Since Medicaid is jointly funded by the federal government and the state, coverage varies from state to state. Most states do provide some level of Medicaid coverage for assisted living services. You’ll need to check with your state’s plan to see what financial assistance is available to you.

Even if your state doesn’t offer financial assistance through Medicaid, it might have another program to assist you. For example, Rhode Island has an SSI Enhanced Assisted Living program to help cover assisted living costs.3

Long-Term Care Insurance

Do you have a long-term care insurance (LTCI) policy? The good news is that LTCI will pay for assisted living. The bad news is that you may need to jump through some hoops first. Many long-term care insurance companies automatically deny initial requests for payment. To get the insurance company to pay, you may need a doctor’s note describing your physical limitations that require help in at least two ADLs. Ask a representative from the assisted living home to act as an advocate on your behalf to speed up the process.

Veterans Benefits

VA health benefits don’t cover rent (which typically includes basic services) at an assisted living facility. You’re not entirely out of luck, though. The VA might cover extra services, such as nurse visits within an assisted living facility. Plus, veterans who qualify for and successfully apply for Aid and Attendance benefits can receive up to $2,200 per month to pay for long-term care.

To receive Aid and Attendance, you or your spouse must have served for at least 90 days during a period of conflict. You also need to demonstrate medical and financial needs. You will need to apply through the VA and show military discharge papers and medical documents.

Life Insurance

Older adults with a life insurance policy might be able to use it to cover the costs of assisted living. Consider the following:

• Set up a living benefit program with your current policy. You’d receive 50 percent of your death benefit while keeping the remainder for your family after your death. Keep in mind that this means leaving less money to your beneficiaries.
• Cash out your policy completely. This is also called “surrendering” your life insurance policy to the provider. Not every policy permits cashing out before death, and you may owe income taxes on the full amount.
• Take a loan from the policy’s cash value. If you only borrow some of your cash accumulation, your policy won’t lapse. However, you’ll need to pay yourself back with interest.
• Sell the policy to a third-party company. You’ll likely only receive 50 to 75 percent of the original policy’s value.
• Do a life insurance conversion. Also called a 1035 exchange, this process lets you convert the cash value of your life insurance plan into a life insurance policy with long-term care insurance. The main downside is that the value of your policy value will be significantly reduced.

Reverse Mortgage

If you own your home and don’t want to sell it, consider a reverse mortgage. This allows you to draw cash in a large lump sum or over time. A reverse mortgage is not for everyone, and there are a number of fees for the service, so be sure you understand the fine print before proceeding. Renting out your home is another option that will supply you with monthly income.

Want to learn more about paying for senior living with no money? Watch the video below with Editor-in-Chief Jeff Hoyt.

Average Cost of Nursing Homes

Nursing home costs are the most highest among senior living options because they provide seniors with round-the-clock care and medical supervision. A private room at a nursing home has an estimated median cost of $9,872 per month in 2024. Seniors can save a little by opting for a semiprivate room, which has an estimated median cost of 8,641 per month. Just like assisted living, nursing home costs will vary significantly by state and the chosen home.

How to Pay for a Nursing Home With No Money

Seniors can pay for a nursing home using the same methods listed above to pay for assisted living. The most notable difference is that Veterans benefits, Medicaid, and Medicare typically offer more coverage for nursing home stays.

Medicare Coverage for Nursing Home Costs

Medicare doesn’t pay for long-term nursing home care. However, you may qualify for coverage during shorter, temporary stays, such as if you require specialized care after a hospitalization.

Medicare helps seniors pay for short-term nursing home stays after they:

• Were admitted to a hospital for at least three days
• Have been admitted to a Medicare-certified facility within 30 days following the hospital stay
• Require skilled care, including physical therapy, speech therapy, or other rehab services

If you qualify for Medicare nursing home coverage, the benefits look like this:

• Medicare covers 100 percent of up to 20 days of nursing home care.
• Patients pay a copay of up to $200 per day for days 21 to 100.
• Medicare stops coverage after 100 days; patients must then cover the full cost.

Medicaid Coverage for Nursing Home Costs

Medicaid is one of the most common ways to pay for a nursing home when you have no money available. In fact, 62 percent of nursing home residents use Medicaid coverage.4 Medicaid coverage does vary from state to state, but low-income seniors who qualify typically have 100 percent of their costs covered. Some may owe a copay. Seniors who want extra amenities outside of their state’s Medicaid coverage will need to pay for those.5 Examples include extra social events, a landline, or a private room when it’s not medically needed.

Even if you have too much money to qualify for Medicaid, don’t count this benefit out. The income limits for Medicaid nursing home care are typically higher. And some states let you lower your income total through the Medically Needy pathway. The amount of money you spend on medical expenses won’t count as income, making it easier to qualify.

Visit your state’s Medicaid website or give your insurer a call to find out what options are available in your state.

Veterans Benefits for Nursing Home Costs

VA benefits help pay for nursing home care if you meet the qualifying criteria. Qualifying veterans can receive nursing home care in Community Living Centers (VA nursing centers), Community Nursing Homes (non-VA nursing homes), and State Veterans Homes. Whether you qualify for coverage depends on the level of your service-connected disability and your income.

Speak to your VA case manager to learn more about the coverage you qualify for. Check out our guide to Veterans benefits for senior care to learn more.

What Happens When You Run Out of Money in a Nursing Home or Assisted Living Facility?

If you run out of money to pay for senior living, your options will depend on your state and whether you’re residing in an assisted living facility or nursing home.

Nursing Home Residents

Federal law entitles you to the right to file a hardship waiver with your state’s Department of Health and Human Services. A hardship waiver must document how the move would endanger your health or your access to shelter and food.

You can also recheck your eligibility for VA benefits and Medicaid. If your financial situation has changed, it’s possible that you now meet the eligibility criteria.

Assisted Living Residents

Federal hardship waivers don’t apply to assisted living facilities, but there are other places that you can turn to for help.

• Area Agency on Aging: This government program helps seniors access the local financial assistance services available to them.
• Long-term care ombudsman: Every state is required to have one under the federal Older Americans Act. They might be able to negotiate with your assisted living facility, secure financial aid to pay for your care, or find you a new home.
• Legal Aid: A lawyer through your local Legal Aid agency may take your case at no cost to you.

Can I Be Kicked Out of My Assisted Living Community or Nursing Home If I Can’t Pay?

In most cases, yes, a care home can evict a resident who can no longer afford to pay. That’s why it’s so important to choose an assisted living facility or nursing home that you can afford now — and also in the future if your resources (savings, family contributions, etc.) run out. Always ask to see the company’s policy in writing so that you know what will happen if your money runs out.

The requirements to kick a resident out for failure to pay vary from state to state. Generally, assisted living and nursing homes must notify you and your family at least 30 days before discharge. They must also create a report summarizing your current mental and physical health status and your post-discharge plan of care.

Alternatives to Senior Living If You Can’t Afford It

If you’re unable to afford a nursing home or assisted living facility, you aren’t out of senior care options. Some seniors get by with a mix of family caregivers, in-home care, and adult day health care.

What Is Adult Day Care and How Much Does It Cost?

Adult day health care gives seniors a safe, secure place to spend time during the day. Staff and volunteers attend to the needs of a group of seniors, providing enriching activities, therapeutic services, health services, meals, and socialization opportunities. Some families utilize adult day care to keep their loved one who has dementia safe while the family caregivers work. Others use adult day care as a form of respite care, giving full-time caregivers time to run errands and relax.

According to Genworth, the estimated median cost of adult day health care is $2,120 per month. Per day, this breaks down to $98. Keep in mind that costs vary, depending on the provider, location, and the number of hours of care.

Read our guide to adult day care costs to learn about ways to pay for care.

What Is In-Home Care and How Much Does It Cost?

Seniors who prefer to — or, based on finances, need to — remain in their own homes might consider in-home care. Professional caregivers come into your home, helping you with ADLs, transportation, light house cleaning, meal preparation, and more. Home health aides are licensed medical professionals who can provide medical services, such as vital sign monitoring, IV treatments, wound care, and mobility.

Full-time homemaker or home health aide services typically cost more than assisted living. However, not everyone requires full-time care. Your in-home care needs might be temporary or equate to only a few hours per week. The estimated median cost of homemaker services is $30.90 per hour, and the median cost of home health aide services is $33.99 per hour. Daily, that amounts to $195 and $213, respectively.

Read our guide to senior in-home care costs to learn more about your payment options, even if you have no money.