Dealing With the Cost of Retirement Homes
- Are you ready to deal with the price of assisted living? Find out about the average cost of retirement homes, and learn how you can pay for senior living.
What Is the Average Cost of Retirement Homes in the United States?
According to Genworth Financial’s 2020 Cost of Care Survey, the average cost of retirement homes in the United States is $4,300 a month. This is the accumulated average for room and board in assisted living facilities across major urban areas in all 50 states. Monthly rates at specific retirement communities vary widely, from well under the national average in some states to far higher than average in some cities.
In California, for example, seniors pay an average of $5,000 a month for assisted living, while the price for similar care in San Francisco averages $6,100. These rates apply only to licensed assisted living facilities, and they may not reflect the local cost of other types of retirement homes.
What Is a Retirement Home?
The term retirement home generally describes any non-medical accommodation that provides room and board to seniors. Aside from independent living in a senior apartment complex, which is much like having an apartment anywhere, there are basically two types of retirement homes: assisted living facilities and residential group homes.
Assisted living communities are typically residential facilities that offer non-medical caregiver support to seniors with limited ability to live on their own. Some assisted living facilities are relatively small, with just a handful of staff members and residents, while resort-style communities can number in the hundreds or even thousands of residents. These facilities generally need to hold a license from the state government and employ certified senior caregivers to help residents with activities of daily living (ADLs).
Senior group homes are similar to assisted living facilities in the level of care they offer, but they are almost always smaller and less institutional in design. A typical group home houses less than a dozen residents, and it may have only one staff member on duty at any time. While assisted living communities tend to be located in purpose-built facilities, group living can be done in a family-style house in a residential neighborhood. The purpose of this is to build an environment for seniors that is as close to a family home as possible.
How Are Retirement Homes Different From Nursing Homes?
Retirement homes of all kinds exist mainly to give seniors a comfortable and safe place to live, usually with a community of other seniors around them. Both residential care homes and assisted living facilities are primarily residential in nature, with limited or no medical support for residents. Both types of retirement homes are principally set up for seniors whose medical condition allows them to live largely independently or with limited help from a caregiver.
Nursing homes are primarily medical facilities and provide skilled nursing care to residents who have individual care plans. Nursing home stays are typically short, with most lasting only weeks or a few months, and are oriented toward physical recovery. Nursing homes usually have a doctor, either on staff or on call, and a team of nurses on-site who can dispense medication and perform a limited number of medical procedures for residents. Time spent in a nursing care facility might be paid for under either Medicare Part A or a private insurance plan, provided you have a medical need for the care they provide.
Does Medicare Pay for the Cost of Retirement Homes?
Medicare is the federally funded health insurance program for eligible U.S. seniors. It generally does not pay for the direct cost of retirement homes, whether group homes or assisted living, because these are not primarily medical services. Medicare does generally pay for inpatient care in a nursing home or hospice, both of which are included under Part A.
Medicare Part B can also pay for many of the outpatient care services many seniors need before entering a retirement home, such as pre-admission medical exams and Alzheimer’s screenings. Room and board at a retirement home, however, is typically not a covered benefit.
Does Medicaid Pay for the Cost of Retirement Homes?
Medicaid is a joint federal-state insurance program for the healthcare costs of medically needy and low-income citizens. Rules for eligibility and coverage vary from state to state, though retirement homes and assisted living costs are nearly always excluded from Medicaid reimbursement. Some exceptions do exist, such as when a beneficiary has a medical need for placement in a group home that offers memory care. Speak with a plan representative about covered benefits before moving into a retirement home.
Can Private Insurance Pay?
Aside from Medicare and Medicaid, many seniors carry some kind of private insurance as a supplement to the benefits they get through the Social Security Administration. These plans vary in their coverage and limits, and so it isn’t possible to generalize about their retirement benefits. Some strictly medical plans, including typical Medicare supplements, are likely to pay only for medical costs, just as Medicare and Medicaid do. Other types of insurance, such as those provided by a labor union, may include a component that pays for the cost of a retirement home. Check with your plan representative to find out what your policy covers.
What Are Some Alternatives to a Retirement Home?
Group homes and assisted living aren’t the only options for seniors who want to make arrangements for retirement living. Many seniors choose to stay in their own homes for as long as they can, which helps keep them in familiar surroundings. Many seniors who stay at home have help from caregivers, who can visit every day or two to help out with routine activities of daily living, such as cooking, cleaning and personal care. If you qualify for Medicaid, your state might have a Home and Community-based Services (HCBS) waiver that can help pay for this service.
Do retirement homes have doctors?
Retirement communities that do not provide medical services generally do not keep doctors on staff the way nursing homes often do. If you live in a retirement home and need a doctor, the staff can call for emergency help or assist you with making an appointment to see your own doctor.
Can a retirement home administer medication?
As a rule, the certified medication aides who work in retirement homes may dispense approved prescription medication, and they may be able to assist with preparing a dose, within the scope set by state law. Staff at assisted living and group homes may not be qualified to administer medication, however, which is more likely to be done in a nursing care setting.
Can residents in retirement homes keep their belongings?
Many assisted living communities make space for new residents to move in their personal effects, including some pieces of furniture. Space may be limited, however, so check with the facility before making a decision. Smaller group homes often try to accommodate residents’ personal effects, though space can be even more limited in these communities.