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Frequently Asked Questions About Paying For Senior Living

Answers For You And Your Family

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Learn About Your Options

You may be overwhelmed by trying to determine the best senior living option for yourself or a family member – specifically trying to find the best way to pay for it. We’re here to help with answers to some of the most common questions about how to finance senior living. If you’re looking for more resources when making a financial plan for your own future or for your loved one’s senior care, you can always contact us.

How much does senior living really cost?

There are several variables that can drive the cost of senior living – for instance location, type of care, and level of services and amenities. According to a survey by the National Center for Assisted Living, the national median costs of care for assisted living services were $4,500 monthly and $54,000 annually in 2021. Senior living apartments without care services generally cost less than assisted living, memory care or skilled nursing.

Is there financial assistance available?

You can get started by researching different resources available to you or a loved one – the team at Highpoint can help you with determining whether financial assistance is available. U.S. wartime veterans often can qualify for the Aid & Attendance benefit for veterans and their surviving spouses, which is a monthly benefit in addition to a veteran’s regular pension used to help cover the costs of assisted living or nursing care. As a “pension benefit,” it is not dependent upon service-related injuries for compensation. Most veterans in need of assistance qualify; however, we recommend that you allow plenty of time for the application process.

Is senior living covered by Medicare or Medicaid?

Medicare does not cover long-term care – a fact which seniors and their families are often unaware of. After a standard yearly deductible, Medicare Part A only covers hospital stays, short stays in a nursing home for certain kinds of illnesses and hospice care in the last six months of life. Medicaid coverage is not accepted at our community; however, you can look into some of the additional options we’ve shared in order to find assistance.

Is senior living covered by long-term care (LTC) insurance?

The specifics may vary according to the type of policy, but long-term care insurance benefits can be applied to the cost of nursing homes and/or assisted living. The first step is finding out how to make use of your policy. These policies are most helpful if you’ve been planning ahead – prices increase in cost with age and poor health, so experts recommend individuals begin planning between the ages of 52-64. If you are looking into long-term care insurance for the future, you’ll find increasingly flexible policies available that can meet needs ranging from adult daycare to assisted living to skilled nursing, with certain options even paying a family caregiver for in-home care. You also might realize tax benefits, making this option even more appealing.

What are other ways to pay?

In most cases, Americans’ most valuable asset is their home – so families often first try to pay for senior living costs with the profits made from the sale of a house. Or they also might decide to look into other options, like renting the house or using the house to qualify for specialized loans. One type of loan is a bridge loan, designed for individuals who need access to funds right away but are waiting for a home to sell. As an interest-only loan, it uses the equity of a house to pay senior living expenses until the house is sold. The borrower then pays off the loan with money from the sale of the house when it becomes available.

You can also look into funding through certain life insurance policies. In order to cash out a policy before death occurs, individuals would research “accelerated” or “living” benefits. Commonly, the company that originally issued the policy buys it back for 50 to 75 percent of its face value, although different rules apply depending on the company and type of policy. You could also consider a “life assurance” benefit or life insurance conversion program, which converts the benefit of a life insurance policy directly into long-term care payments.

More questions?

If you have additional questions about senior living and how to pay, reach out to us at Highpoint at Cape Coral so we can provide you with the information you need to make the best choice for you or your loved one.

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