July 2005
| Paying for it Most people in assisted living pay for it out of their own (or a relative's) pocket or with proceeds from long-term-care insurance, if the policy allows. If money runs out, a resident usually has to move out to a nursing home where he or she may qualify for Medicaid or to a relative's home. A few providers pledge to keep residents even if they deplete their funds. Some nonprofits can tap charitable donations to reduce a needy resident's fees. Unlike nursing-home care, assisted living doesn't generally qualify for payment by Medicaid. However, 42 states have a Medicaid waiver program that allows some funds to pay for skilled nursing care in assisted living. The resident must generally meet certain low-income requirements: generally owning no more than $2,000 in liquid assets and with income of no more than $1,600 to $1,700 a month. Worse, states limit the number who may qualify to 300 to 400 people at any one time. Assisted-living meals, lodging, and medical care may be tax deductible as medical expenses. However, you may only deduct medical and dental expenses that exceed 7.5 percent of your adjusted gross income. "To qualify for the deduction, you should have a document signed by a doctor or nurse that says the expenses were incurred for someone who has severe cognitive impairment or needs help with at least two ADLs," say H. Clyde Farrell, an elder-law attorney in Austin Texas. |
