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Medicare vs. Medicaid: Which One Pays for Assisted Living?

When it comes to long-term care, many seniors may consider Medicaid and Medicare. Designed to provide financial assistance for seniors, both feature different eligibility requirements and coverage. Hence, it’s crucial to understand the ins and outs of Medicare and Medicaid—especially when it comes to assisted living. Grab some paper, put on your reading glasses, and get ready to take some notes. Here’s what you need to know.


Medicaid Assisted Living Coverage

Medicaid is a joint federal and state program that provides healthcare coverage for low-income individuals, including older adults. This program covers a wide range of healthcare services, including assisted living services. However, the Medicaid-assisted living coverage requirements vary widely from state to state. To qualify for Medicaid-assisted living coverage, you must meet specific eligibility requirements, such as having a limited income and a medical need. Once you’re approved for Medicaid-assisted living coverage, you’ll receive access to services like personal care, housekeeping, and more! Your state’s Medicaid agency can provide more information about eligibility requirements and covered services.

Medicare Assisted Living Coverage

Medicare sticky notes

Unlike Medicaid, Medicare is a federal program that provides healthcare coverage for senior adults aged 65 and older. However, it has limited coverage for assisted living services. However, Medicare provides coverage for skilled nursing care, short-term rehabilitation care, and hospice care. If you’re seeking long-term care in assisted living, Medicare may NOT be your best option.


Fortunately, Medicare Advantage plans, offered by private insurance carriers approved by the Centers for Medicare & Medicaid Services (CMS), may provide some coverage for assisted living. It’s important to research carriers and plans carefully, because coverage varies.

Questions to Consider

As you consider long-term care options, you may ponder Medicaid and Medicare benefits for assisted living services. Specifically, how do you know which one is right for you and your individual circumstances? In order to make the best possible decision, you’ll need to ask yourself some tough questions. Here are a few to consider:

  • Does Medicare cover nursing home or assisted living care?
  • Does Medicare pay for assisted living beyond short-term rehabilitation?
  • What are the eligibility requirements for Medicaid and Medicare?
  • What are the differences between Medicaid and Medicare?
  • Can I receive Medicaid and Medicare coverage simultaneously?
  • What services are covered under Medicaid and Medicare?

What if I’m not eligible for either?

question marks shrugging man

It happens! Some people may not be eligible for Medicaid or Medicare coverage of assisted living. When this happens, you may need to pay out-of-pocket or consider other funding sources. Some facilities offer payment plans or financing options to make their services more affordable. Additionally, you may be able to use a reverse mortgage, life insurance policy, or annuity to fund your long-term care expenses.

Click HERE to learn more about reverse mortgages.


It’s important to plan ahead for your long-term care needs. Luckily, various planning tools and strategies can help you protect your assets and ensure you have access to quality care when you need it. For example, long-term care insurance can help cover the cost of assisted living and other long-term care services, while also preserving your assets. Always consider consulting with a professional who specializes in senior living and care, such as a financial planner, elder law attorney, or geriatric care manager. Not only can they help you understand your options, but they can help you make an informed decision for your unique situation!

Looking for more?

While long-term care can be expensive, you still have many options for financial assistance. Still looking for more information on Medicare? Then visit our Medicare & More Blog for more great articles!

Originally published August 30, 2023

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