What are Residential Care Homes and How Much Should They Cost?

Last Updated Apr. 21st, 2017

A Comprehensive Guide to Residential Care Homes

The vast majority of older adults want to age in place if possible — but health or other care needs may make this option impractical. Fortunately, there’s a homey alternative: residential care homes. A care home is a home-away-from-home that still looks and feel like home, rather than an institutional setting.

Across the country they are called by various names, including residential care homes, residential care facilities for the elderly (RCFE), adult family homes, board-and-care homes, and personal care homes. But they all provide a very basic and needed service: care for seniors in a home-like setting.

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In some areas, residential care homes are the last resort in terms of finding placement for residents who don’t quite meet the criteria for nursing home care, but may not have the funds for assisted living. Residential care homes also tend to be a good choice for seniors who have mild mental health issues that hinder their ability to live independently, or to be accepted into assisted living facilities.

Most care homes are located in former single-family homes that have been converted into multi-unit dwellings. These homes may only have the ability to care for three or four residents. Some are larger, hotel-like buildings that can accommodate a few dozen residents, although this is less common because it changes the focus on personal, home-style living.

In some states, there is no distinct regulatory difference between personal care homes and assisted living facilities. However, the level of care can vary significantly. Some residences are simply for those who need companionship, while others help with select activities of daily living, such as dressing and bathing. In some settings, if appropriately staffed, medication administration and limited medical care may be provided.

Cost: As with assisted living facilities, the cost of personal care homes varies by location. Typically costs are half that of nursing home care, and often less expensive than assisted living as well, depending on the services needed. Costs typically range from $2200/month for a shared bedroom to $3400/month for a private room, according to Genworth.com, and will likely be higher for dementia care, often $4500 or more.

This rate often includes three meals a day, though each care home designates its own fees. The biggest cost differentiator is whether or not a care home is a state-licensed Medicaid facility — and whether a prospective resident is Medicaid eligible.

Paying for Residential Care

In addition to personal resources and private insurance, Medicaid may be an option for low-income elders who need care beyond just room and board.

Medicaid pays nursing home expenses for individuals who meet income and resource eligibility requirements. Medicaid can pay for care that is above the level of room and board, but less intensive than skilled nursing care.

Contact your loved one’s state Medicaid agency for eligibility and program information as early as possible. Financial guidelines vary from state to state and can be somewhat restrictive. In addition, the process of determining eligibility and the start of Medicaid benefits usually takes time.

Note: If either spouse transfers resources, such as real estate or bank accounts, for less than fair market value within 30 months before a spouse enters a nursing home, this could affect the extent to which Medicaid pays for the cost of care for the spouse in the nursing home and for certain community services. Because these issues are complex, the best route is to consult with an elder law attorney who specializes in these areas.

Finally, if a senior is a veteran, a program such as the Veteran’s Aid and Attendance benefits may be available to help pay for room and board.

When considering a residential care home, ask the following questions to regarding services and costs:

  • What is the monthly fee, and what does it include?
  • Are there other services available? What is the additional cost?
  • What are the payment policies?
  • What happens if someone must leave the home for medical care? Will their room be held, and if so, for how long? If the absence becomes long-term, will the rent be refunded?
  • What happens when private funds are depleted? Are there other forms of financial assistance?
  • Will Medicaid cover some or all of room and board?

Regulations: Although most residential care homes are privately owned, there are regulatory boards that oversee residents’ well-being. Depending on state licensing, the home may be subject to inspections by various departments to ensure the facilities comply with codes, policies and procedures, and to ensure residents are receiving proper care. If the care home accepts Medicaid, the state’s Department of Public Welfare will also be involved in the inspection process. All inspection findings are public record and can be made available upon request.

Activities: Many residential care homes offer group activities to help residents stay alert, healthy, and active. From movie and game night to bingo, discussion groups and possibly an exercise or fitness class, socialization and companionship is a key component of most care homes.

Personal Assistance: Some residences are able to provide assistance in scheduling and keeping doctor’s appointments. The staff may also notice when there is a change in a senior’s health or behavior that may warrant a doctor’s visit. Often, staff can also arrange transportation.

Freedom: Most care homes allow residents to come and go as they please. They also may allow smoking on premises, which is often restricted in other senior living settings. Of utmost importance, the residential care home must provide the resident with respect and dignity, and unless they are incapable of making their own decisions due to mental incapacity, they should have the rights guaranteed to all.

As with any senior-living setting, it is important to tour each prospective care home ahead of making a move-in decision. Ideally, family members ought to visit the home at various times, even unannounced, to ensure you get a good sense of what living there is like. While touring, take note of:

  • Cleanliness: Does the facility appear clean? Does it have a noticeable odor? Do the residents appear clean and well groomed?
  • Staff Interaction: Does the staff treat residents with respect and courtesy? Do they appear to enjoy their jobs?
  • Room Accommodations: Are the rooms private, semi-private, or group rooms? Will your loved one be comfortable sharing his/her bedroom with others?
  • Bathrooms: Are there ample bathrooms for the number of residents in the home? Are there private showers?
  • Resident Interaction: Does it appear as if the residents get along and enjoy one another’s company?
  • Smoking: Does the facility allow smoking in common areas? Are there designated smoking/non-smoking areas? Will this work for your loved one, or does he/she wish to live in a completely smoke-free residence?
  • Safety: Are hallways and stairwells free of obstacles and fall hazards? Are exits well lit and easily accessible? Are there security systems in place to prevent unwanted visitors?
  • Surroundings: Does the home offer good lighting, clean furnishings, and well-kept grounds? Are there outdoor areas that can be used? By appearance alone, is this a place where you would be comfortable living?

In addition to touring, spend some time talking with the administrator or intake coordinator. Ask to see the latest state inspection survey. This will list any infractions and plan of correction. Do you notice any trends or severe infractions that could pose harm to your loved one?

Some additional questions to consider:

Staffing:

  • What are the staff’s qualifications? Are they specially trained or licensed?
  • How long has the facility been under the direction of the current administrator?
  • What is staff turnover like? What is the average length of employment?
  • Is the residence staffed 24/7?
  • Is staff continually updated on policies, trends and techniques in elder care?

Dining:

  • Do residents eat together in a dining room, or on their own? Do they have the option to do either one?
  • Are meals prepared? Are dietary preferences taken into consideration?
  • Can residents cook independently?
  • Can they cook in their room via microwave or hot plate?
  • Are there accommodations for special diets, i.e. diabetic, heart healthy, gluten-free?

Services and Activities:

  • What type of personal care assistance is available, e.g., bathing, grooming, dressing?
  • Is medical care available onsite?
  • What happens if my loved one no longer meets the criteria for self-care at the facility?
  • Are there any transportation services available?
  • Are there regularly planned activities?
  • Are there religious events?
  • Are there regular visiting hours? Do guests need to call ahead?
  • Are pets allowed? Does the home have a “house” pet?

Other Residents:

  • Do residents speak highly of the home and staff?
  • How are room changes and roommate concerns handled?
  • Is there a residents’ council that allows residents to freely voice their concerns?
  • Do any of the residents have a history of violent or aggressive behavior? How does staff handle such situations?

Making the move to a personal care home can be a huge change for an older adult, especially if someone has mental health issues or disabilities. This transition often comes after living independently, and will require an adjustment period. Other residents find themselves in a care home after an illness or injury, and they or their family feel returning to their own home is not in their best interest right now.

Whatever the circumstances, transitioning to a new living arrangement may be difficult. This guide is intended to make that transition a little easier.

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