Finding assisted living on a limited income can be challenging — but for many seniors, the definition of “low income” is itself perplexing. What determines whether someone qualifies?
Defining income levels
According to the U.S. Department of Housing and Urban Development (HUD), as of 2015 the low-income limit is “80 percent of the median income for the county in which the person resides.” The median number refers to the midpoint in a series. So, if income levels for a senior’s county of residence range from, say, $15,000/year to $60,000/year, with $30,000 as the middle (not average) of this range, a senior who receives $24,000/year (80% of $30,000) would be considered “low income”.
While this definition of low income may still seem quite adequate to someone living at or below the poverty level, HUD makes two additional distinctions. “Very low income” is no more than 50 percent of the median income (which would be $15,000 in our example), and “extremely low income” is just 30 percent or less of the median income (e.g., $9000 or under, per our example).
Keep in mind that the government isn’t just looking at a senior’s Social Security check. HUD counts income from pensions, retirement accounts, IRAs, insurance annuities, and assets such as real estate, cars, etc., when assessing eligibility.
Here are five public and private resources seniors and their families can explore to help low income elders afford assisted living:
Low-income seniors 62+ may qualify for subsidized rental assistance via HUD’s Section 202 program, which covers both independent and assisted living environments. Established in 1959, Section 202 is the only HUD program that provides housing exclusively for seniors. The rent-assisted housing is designed specifically to enable seniors and the disabled to live as independently as possible.
Although the federal government funds the program, applications are accepted and funding is distributed at the state and county levels. Section 202 vouchers help pay for rent and other housing expenses, and a senior must contribute to the overall cost.
Assisted Living Conversion Program (ALCP)
ALCP may be the best of both worlds: aging in place with assistance. Since 2012, HUD has channeled $26 million in grant funding to owners of multi-family housing developments in Arizona, California, Colorado, Connecticut, Massachusetts, Minnesota, New York, Ohio and Texas. The monies have been used to convert existing units into affordable apartments for seniors who need the types of support services assisted living provides, but still want to live independently.
Eligible projects must also qualify as Section 202 or similar subsidized HUD housing. This article explains ALCP in detail.
Veterans and spouses of veterans may qualify for aid from the U.S. Department of Veterans Affairs. Although the VA does not pay a veteran’s rent, it may cover some of the services provided by an assisted living facility. Known as Aid and Attendance (A&A), this benefit is a monthly, needs-based payment above and beyond the VA pension that can help cover the costs of long-term care. It is important to note that a veteran or surviving spouse may only receive Aid and Attendance or Housebound benefits (if they are unable to leave their home), not both at once.
To be financially eligible for A&A:
- A single veteran must have countable income under $12,907 a year
- A veteran with a dependent or spouse must have countable income under $16,902 a year (as of 2016).
This article explains veterans’ benefits in detail.
Long-term Care Insurance
Long-term care insurance, or LTCI, can be tricky. While it appears to be a natural hedge against a future possibility of becoming ill or disabled, long-term care insurance is not a catchall solution. Here’s why:
LTCI premiums can be as steep as the cost of care itself; what is covered varies by policy. For example, a “facility-only” policy covers care in a licensed assisted living facility or in a skilled nursing facility, but not in an unlicensed facility or in your own home. And, there is usually a “waiting” or “elimination” period before someone is able to access funds. The shorter the elimination period you select, the more expensive the premiums. Learn more here.
Residential Care Homes
Another possibility is a residential care home, also known as RCFE (residential care facility for the elderly), adult day home, board-and-care home, or personal care home. These small group settings provide basic services (usually meals and light assistance) at a much lower cost than typical assisted living communities or nursing homes. Medicaid may also pay some of the cost for residents who meet eligibility requirements.
Finding Appropriate Housing in Your Area
HUD has compiled an exhaustive multifamily inventory of housing units for the elderly and persons with disabilities. Though not all housing units qualify as assisted living, they are all subsidized HUD housing for seniors and persons with disabilities. You can click the link for your state, and begin to make inquiries at locations that sound promising.