Paying for Alzheimer’s Care Overview
Alzheimer’s disease, Lewy Body dementia, Frontotemporal dementia (FTD), and other related memory disorders and dementia affect over 5.5 million aging Americans. Depending on the stage of these diseases, individuals can require 24-hour supervision or care. This means each year in the U.S., there are billions of hours spent caring for individuals with these conditions. While the vast majority of that care is provided by friends and family members, what happens when those caregivers are not available? Who pays for Alzheimer’s care? Fortunately, there are many programs that provide financial assistance, respite care, and other forms of aid to help families and caregivers.
Did You Know? The worldwide cost of dementia care is approximately 1 trillion U.S. dollars. If dementia care were a country, it would be the world’s 17th largest economy.
Types and Costs of Alzheimer’s Care
Prior to a discussion of the financial resources available to assist individuals stricken with Alzheimer’s, it is helpful to understand the different types of Alzheimer’s and dementia care, how they differ from regular home care or assisted living, and what these services typically cost. The following information is current for year 2024.
Alzheimer’s Care at Home
Most home care providers do not charge higher fees for individuals with Alzheimer’s. Rather, they have a flat rate for home care services and a slightly higher rate for home health care services. Depending on one’s state, as of 2024, this figure ranges from $15 to $44 / hour, with a national average of $30 / hour for home care services. Home health care is just slightly higher in some locations, ranging from $23 to $40 / hour and a national average of $33. See each state’s average home care costs.
Preventing WanderingThe tendency for individuals with dementia to leave the home and become lost presents a challenge for Alzheimer’s caregiving at home. In residential care, security prevents wandering. But until fairly recently, private residences did not have this option. Now there are internet / smartphone products for real-time location monitoring, which can reduce wandering and the cost of caring for loved ones at home.
Alzheimer’s Care in Senior Living / Assisted Living Residences
Approximately 75% of senior living residences are able to accommodate individuals with Alzheimer’s or dementia. Often, these facilities refer to themselves as Memory Care Residences, Dementia Care Facilities, or Alzheimer’s Care Units. Almost all senior or assisted living residences have security systems in place to prevent wandering. The security might be locking doors in a special Alzheimer’s wing, informed security guards, or electronic location monitoring.
Depending on one’s state of residence, assisted or senior living costs approximately $3,800 to $8,712 / month. The national average in 2024 is $5,350/ month. The cost of Alzheimer’s care in assisted living communities is approximately 20-30% more. See the average Alzheimer’s care cost in your state.
Alzheimer’s Care in Nursing Homes
Almost all nursing homes or skilled nursing facilities are equipped to provide services for those with Alzheimer’s or dementia. Most do not charge additionally since comparatively these individuals do not require more care than other nursing home residents.
In 2024, the national average amount paid for a shared room in a skilled nursing facility is $320 / day or $9,733 / month. State daily averages range from $220 – $1,137 a day. Sharing a residence reduces the cost to 10-20% of that for a private room. Unfortunately, sharing a room is not always an option for persons with aggressive forms of dementia. See each states’ average nursing home care costs.
Alzheimer’s Care at Adult Day Care Centers
Adult day care centers, like nursing homes, typically do not charge additional fees for individuals with Alzheimer’s or dementia. However it is important to recognize that many centers are not able to accommodate individuals in the later stages of the disease.
Adult day care is typically charged by the day or half-day instead of by the hour like home care. The national average day-rate for adult day care for 2024 is $95. Assuming 22 days of care per month, this works out to approximately $2,090 / month.
Cost of Alzheimer’s Medications
Regardless of the location in which the care is provided, many individuals with Alzheimer’s or dementia require prescription drugs. Consumer Reports finds that the average individual with Alzheimer’s pays between $200 – $400 / month for their medications.
Payment Options / Financial Assistance for Alzheimer’s Care
For most families, the expenses of caring for a loved one with Alzheimer’s or dementia are covered not by a single source, but instead by contributions from a variety of sources. Some of these resources are specifically designed for Alzheimer’s patients and others are of a more general nature.
Did You Know? Dementia Care Central is a free website that offers tips, suggestions, and videos on how to provide hands on care and gain the cooperation of persons with Alzheimer’s.
Medicare’s Benefits for Alzheimer’s & Dementia
There is not a simple answer to the question “Does Medicare pay for Alzheimer’s care?” Medicare, like most health insurance, does not differentiate Alzheimer’s and dementia care from other conditions such as heart disease. Instead, Medicare has certain policies with regard to when and how much it will pay for care. For example, Medicare will pay for 100% of the cost of nursing home care if it is medically necessary for 20 days and 80% of the cost for an extra 80 days. If an individual with Alzheimer’s requires care in a psychiatric hospital, Medicare increases the number of days they will provide assistance up to 190 days.
Medicare does not pay for personal care at home or in assisted living and its nursing home benefits are limited to 100 days.
Medicare does not pay for custodial or personal care that is provided in an assisted living residence. But it will pay for medical care provided in that location. The same applies for home care and adult day care. Personal care services, assistance with the activities of daily living and supervision that are typically necessary for Alzheimer’s patients are not covered. But medical care is covered. There is an exception to this for individuals receiving hospice care at home. Medicare will pay for homemaker services, which includes personal assistance for individuals determined to be in the final 6 months of their life.
Medigap plans, or Medicare Supplementary Insurance, does not specifically provide additional benefits for Alzheimer’s patients. But it does offer supplemental assistance. For example, these policies usually pay the 20% of the cost of nursing home care that Medicare does not pay.
New in 2019, Medicare Advantage (MA) plans are able to offer some long-term care services and supports as a supplemental health benefit, given they:
- Compensate for physical impairments
- Diminish the impact of injuries or health conditions
- Reduce avoidable emergency room utilization
Examples of potentially available benefits, which can be very instrumental for persons with Alzheimer’s, include:
- Adult day care
- Home modifications (wheelchair ramps, grab bars)
- Personal emergency response systems
- Respite care
- Personal care assistance
- Homemaker services
- Meal delivery
In 2020, MA plans are further expanded their supplemental benefits to assist chronically ill persons. These benefits offer a fairly large degree of flexibility. The requirement being that with the receipt of benefits, the care recipient has a decent chance of improvement in health or functioning, or at least maintaining the same level of health and functioning. The new benefits can be customized to the specific needs of MA plan enrollees. For instance, a senior with Alzheimer’s disease may be able to receive wandering support services.
Medicaid & HCBS Waivers and Alzheimer’s Care
Medicaid is a state and federally funded health insurance program for low-income families and the elderly. Each state administers their Medicaid programs separately. Therefore, each state offers different benefits with regards to caring for individuals with Alzheimer’s or dementia.
Medicaid Waivers are state programs that allow individuals to receive care outside of nursing homes. Instead of requiring institutionalization, Medicaid Waiver participants can receive care, paid for by Medicaid, in their homes, the homes of relatives, and sometimes in adult foster care homes and assisted or senior living residences. Almost all Medicaid Waivers have both financial eligibility requirements and requirements that the participant have functional limitations. Very few, require a specific diagnosis of Alzheimer’s or dementia. Instead, they consider one’s ability or inability to care for themselves by accessing their ability to perform their activities of daily living. From a functional perspective, mid to late stage Alzheimer’s patients typically qualify for Medicaid benefits quite easily.
For more information on Medicaid and each state’s waivers, please use the following links: General Medicaid, Home Care Waivers, Assisted Living Waivers, Adult Day Care Waivers, and Adult Foster Care Waivers.
State Non-Medicaid Assistance Programs for Alzheimer’s
There are many state-funded or state-managed assistance programs that are designed for low-income individuals that require assistance with activities of daily living. While not specifically designed for Alzheimer’s patients, given that many Alzheimer’s patient are not working, have low incomes and require daily assistance, it is fairly common for these individuals to qualify for these programs. See a complete list of state non-Medicaid assistance programs.
In addition to the more generalized assistance programs, several states have programs designed specifically for individuals with Alzheimer’s, dementia or related conditions. Unlike the programs described above, these programs usually don’t consider an individual’s financial income or assets as an eligibility factor. They simply require a diagnosis of Alzheimer’s, dementia or other related memory disorder to qualify for the program.
Alaska Adult Day Services
Alaska Senior In-Home (SIH) Services
Alaska Alzheimer’s Disease & Related Dementias Mini-Grants
Delaware Adult Day Care and Alzheimer’s Day Treatment
Florida Alzheimer’s Disease Initiative
Kentucky Adult Day Care and Alzheimer’s Respite Program
New Jersey Alzheimer’s Adult Day Care Services
North Carolina Project C.A.R.E.
North Carolina Special Assistance Adult Care Home Special Care Unit Program
Oregon Project Independence
Vermont Dementia Care Respite
West Virginia Family Alzheimer’s In-Home Respite
Wisconsin Alzheimer’s Family & Caregiver Support
Respite Care for Alzheimer’s Caregivers
Respite care is temporary assistance provided to the primary caregiver to allow them a break from caring for an individual with Alzheimer’s or dementia. It can be provided in the home, in an adult day care center, or sometimes in an assisted living residence or other residential setting. Respite care is sometimes provided free of charge or other times at a greatly reduced hourly rate. There are many different organizations and programs offering respite care services. It is worth noting that often times these are home care companies selling home care and marketing it as respite care even though they are charging the full hourly rate.
There are also federally funded programs that provide reduced rate or free respite care, such as the Lifespan Respite Care, the National Family Caregiver Support Program, as well as programs specific to individual states including Florida’s Project R.E.L.I.E.F., New Jersey’s Statewide Respite Care, and Connecticut Statewide Respite Care Program.
Non-Profits and Foundation Assistance for Alzheimer’s
Three national organizations offer various levels of support and respite care programs for Alzheimer’s patients and their families and caregivers. The Alzheimer’s Foundation of America offers “Family Respite Care Grants” by funding local, non-profit, member organizations. These member organizations work directly with the families to administer the grants. It is worth noting that local organizations sometimes combine funds with other sources. Therefore the name “Family Respite Care Grants” may not always be used. The Alzheimer’s Association has a respite care program as well. One can read more about both organizations on our non-profit Alzheimer’s care page. Hilarity for Charity is a newer organization that offers respite care grants as well.
Assistance for Veterans with Alzheimer’s
While the VA does not have programs specifically for individuals with dementia or Alzheimer’s, there are benefits available through other VA programs that are available and relevant to veterans with these conditions. A pension benefit known as Aid and Attendance can provide the greatest amount of financial assistance. Up to approximately $3,649 / month in some cases. There is also VA Respite Care and other assistance available through Veterans’ Directed Home and Community Based Services.
Using Reverse Mortgages for Alzheimer’s Care
The decision on whether or not to use one’s home, through a reverse mortgage, to help pay for care is not an easy one. In many cases, it does not make good economic sense, but in other situations it does.
The two most important factors when considering a reverse mortgage to pay for Alzheimer’s care are one’s marital status and their expected duration of need.
Reverse mortgages come due one year after the homeowner moves from their home. Given that most individuals with Alzheimer’s will eventually require residential care, it becomes a question of how many years until that point. Should one be at the early stage of the condition and won’t require residential care for 5 years, a reverse mortgage might make good sense as a funding resource for occasional assistance around the home. However, if one might need to move within 2 years, a reverse mortgage would be considered an expensive source of funds. The exception to this rule is when the individual with Alzheimer’s has a healthy spouse who will continue to live in the home when the spouse with Alzheimer’s moves into a care facility. In this situation, a reverse mortgage could be a sound decision.
Life Insurance Conversions
Life insurance policies can be exchanged for Alzheimer’s care services. This allows the policyholder to receive money for care and maintain the option for Medicaid eligibility.
Holders of life insurance policies have several ways they can use their policy to help pay for Alzheimer’s care while the individual is still living. Their first option, for when the policyholder has a limited life expectancy, is to go to the company that issued the policy and request accelerated death benefits or a death benefit loan. The second option is to sell the policy. The buyers will pay a lump sum, take over the monthly payments and collect the death benefit when the individual passes away. A third option, which offers the highest value for life insurance policies, is to exchange the policy for care services. For example, an intermediary organization will determine the policy’s value and convert that into a specific number of months or years at a residential care facility. There are several other benefits to this approach. Learn more here.
Alzheimer’s Care Loans
For persons with a short-term need for senior care financing, these loans are a good option. They are most appropriately used when a family is waiting on additional financing. As an example, a family might be receiving veterans’ benefits for Alzheimer’s care, but has to wait 9 months to get through the veterans claims backlog. Or perhaps they can afford care, but will be paying for it with the proceeds of a home sale. For more information on the fees and the other pros and cons for these loans, click here.
Assistance for Medications
Most pharmaceutical companies offer prescription assistance programs, sometimes called PAPs, for individuals that require a prescription, but cannot afford the cost of the drug. Medications are provided free of charge. Or, if an individual has insurance, the pharmaceutical company may waive the co-payment costs. To find financial assistance for Alzheimer’s medications, individuals should write down the name of all their Alzheimer’s medications and search the database of assistance programs at this website. One can also learn more about Prescription Assistance Programs.
