Comparing Costs

Most people pay for Assisted Living with current income from social security and pensions coupled with the use of savings, including the proceeds from selling a home. Long Term Care Insurance is more and more widely used to offset the cost of Assisted Living. Some consumers convert life insurance policies to a loan, and others have family members who help pay a share of the monthly cost.

Medicare and other health insurance plans and HMOs will NOT pay for assisted living services. There is, however, a program for veterans that will contribute over $1,900 a month (and over $2,200 for couples) called the Veterans’ Aid and Attendance Benefit.

Most Assisted Living communities have a year-long lease that residents sign, just like renting an apartment. The base monthly fee will be a set amount outlined in the lease, but the total monthly cost depends on the fee system used to calculate personal care where your Mom or Dad lives.

Also, keep in mind that most Assisted Living communities will increase their fees every year. Ask the community what their typical increase has been for the last few years. This will give you a good indication of what to expect when your one-year lease is up for renewal.

Costs may vary:

• By the amount and kind of personal care assistance included in the service package. You may be quoted a price based on your loved one needing no care, a small amount of daily care or a large amount of care. Under a tiered pricing structure in which costs are calculated based on the actual number of hours/minutes that care was provided, initial quotes may not reflect the true costs that your Mom or Dad will actually incur. If your loved one needs more care than the allotted time under the “tier” you are paying for, your cost for care will increase.
• By the size, location, and special features of the apartment. Accommodations can range from a shared bedroom to a two-bedroom apartment. Some communities charge more for apartments that are considered “prime” for characteristics such as proximity to an elevator, great views, extra closets or oversized windows.
• By geography, land, real estate taxes, insurance, construction costs, and labor all vary geographically, and they affect the cost of developing and running an Assisted Living community. For example, New England is more expensive than Florida. Even within the same state, Assisted Living communities in wealthier towns will cost more than in other towns and cities.
• By the company. Some companies charge more than others, perhaps because they need to maximize profits for stockholders or they have a large corporate headquarters with more overhead.