1. Check out Medicaid or veterans benefits options
Medicaid: You may live in a state that covers all or part of the costs of assisted living through Medicaid. Call your state Medicaid program and see what they'll cover and eligibility requirements. One odd item is that not every assisted living community will accept Medicaid. So make sure to ask the question of each assisted living community as you do your research.
Veteran’s Benefits: If either one of your parents is a veteran of the armed forces, they may be eligible for assisted living benefits from the Veterans Administration, through its Special Compensation program. In fact you may be eligible for any number of VA long term care benefits in a number of different settings including home care, nursing home, assisted living, adult day centers, etc... Learn more and call the number on their site here.
2. Check insurance options to reduce assisted living costs
Long-Term Care Insurance: While notoriously expensive, a long-term care insurance policy may cover assisted living costs - how much will depend on the policy. There are different plans, some which cover the cost of the facility only, while others may also cover some of the a la cart supplemental caregiving costs like assistance with bathing, toileting, or dressing.
Life Insurance: Another strategy is to use the equity a parent has built up in their life insurance policy to pay for their assisted living expenses. Ask your parent's insurance company, agent or broker if their policy offers living benefits that allow them to cash out their benefits at a percentage of its equity value. You or your parents may also be able to borrow against it or sell it to a 3rd party.
If you decide to go down this route, explore all 3 options (early cash-out, loan, sell to a 3rd party) and see which gives you the best bang for your buck.
3. Explore different available living arrangements
Regardless of whether you get financial support or find some liquidity, there are still things you can do to stretch your dollar and help it go further.
• Get the right amount of space. Many communities will offer studio, one-bedroom and two-bedroom options. Don't compare the size of a studio to your parents current home or apartment. Remember, your parents will be socializing in the common areas and eating in the dining room. You can save a LOT of money by opting for the smallest, most liveable space.
• Go small. Smaller communities tend to be LESS expensive than the larger communities. Explore all options in your area. Don't just rely on internet sites, as many require payment from assisted living communities to be listed or featured. Call your local senior centers, area agency on aging and your personal network.
• Look nearby. Sometimes the cost of assisted living communities are driven by the cost of real estate. Check surrounding cities to see if costs vary. You may have equivalent facilities, with equivalent services and quality but different prices, just because of a change in location. Remember, chances are your parents won't need the proximity to services like the bank, pharmacy, hair dresser and grocery store. So other than being close to you, you may have more flexibility to look around.
• Get only what you need. Many assisted living communities will offer an all inclusive services package. Instead, review the a la cart offerings and only select those services your parents really need. Don't pay more than you have to.
4. Negotiate
Assisted living communities are not different than any other business. They have rooms to fill, budgets to meet and goals to attain. Just like a car dealership has to get rid of their older models before the end of the year, some assisted living communities may have an extra incentive to rent out a room before the end of the month. What's their occupancy rate? Try to negotiate a free month, waiver of a move-in rate, etc...
Do your research
As you can see there are several ways you can either get financial assistance to help you subsidize the cost of assisted living, get liquidity from assets currently tying up cash or simply ways to reduce the cost of assisted living, allowing you to stretch your dollar further.
Explore all your options at the local level. Visit several assisted living communities close by and in nearby areas, after qualifying them over the phone. Review your parents situation with a financial advisor to see what they can responsibly afford. Call the VA, Medicaid and your local area agency on aging, to see what resources might be available to your parents.
For example, perhaps you can put your parents in an assisted living community, but Medicaid will pay for someone to shower your parents several times a week. Unfortunately, you'll have to do some digging. But there's no better advocate for your parents than you!
