In 2022, the national median cost of assisted living is $4,635 per month; however, these costs will vary greatly depending on both location and the type of community.
In my experience as a caregiver, I’ve learned how assisted living works, particularly with regard to the money entailed. In this rundown, we’ll look at the assisted living costs, explore some ways to offset them, and examine all the benefits of these types of services.
There are three key components that comprise the majority of assisted living costs. First off, when initially moving into an assisted living facility, you’ll need to shell out a fixed fee that can range from $1,000 to $5,000. This can be paid upfront in full or prorated monthly.
Secondly, you’ll have to pay monthly rent, almost like an apartment. While this figure varies depending on the location of the community, the apartment size, and some additional factors, this will likely be around $4,000.
Finally, there are a number of add-on care services such as help with bathing, eating, and medication. These offerings will vary by the facility, but they’ll most often come with additional charges on top of the monthly rent.
In 2022, the average national cost of assisted living rose to over $4,500 per month. Due to a growing shortage of qualified caretakers, facilities have needed to pay more in order to secure the right people. Recent hikes in minimum wage requirements and changes in overtime payment legislation are also increasing assisted living costs.
Additionally, more adults with Alzheimer’s and dementia are entering retirement homes than ever before. Finding qualified staff to take care of their specific set of needs is proving to be quite expensive. Finally, with older adults waiting longer to sign up for long-term care, the care they end-up needing often proves more costly.
The one-time move-in fee is like a reservation deposit for holding your spot at an assisted living facility, many of which have lengthy waitlists. Some facilities will refund this charge in the event that you are unable to move into the property. Additionally, your monthly rental fee would cover the likes of apartment rent, exercise, health and wellness programs, utilities, basic housekeeping, maintenance, transportation, personal assistance, and catering.
Aside from the move-in fee and monthly rent, there is also a monthly care services fee to consider. This is charged in case older adults need help with everyday activities such as bathing, eating, or dressing. Depending on the range of activities for which you need assistance (and the number of hours entailed), the total service fee will vary.
Generally, it starts from around $150 and increases as you add on services a la carte. You may also have to pay a couple of hundred bucks extra for services such as physical or occupational therapy and medication management. It’s very easy to get lost in the complexities of tiered pricing, so be sure to map your needs to the services being offered by each facility.
On the other hand, some assisted living facilities offer an all-inclusive pricing model for a flat yearly fee. This one-size-fits-all model allows you to plan your monthly expenses a lot better. This means that you’re able to take advantage of basic services without incurring any additional charges.
Like the housing market, the cost of assisted living varies greatly depending on your geographic location. Regardless, assisted living usually costs less than both in-home care and nursing homes.
| In-Home Care | Assisted Living | Nursing Home | |
| National | $5,106 | $4,634 | $9,305 |
| Midwest (Kansas) | $4,713 | $4,580 | $7,017 |
| South (Texas) | $4,567 | $4,118 | $7,305 |
| West (California) | $6,284 | $5,408 | $12,532 |
| Northeast
(Massachusetts) |
$5,911 | $6,695 | $13,941 |
*From Genworth Cost of Care Survey 2022.
A number of assisted living facilities charge based on levels of service. The monthly cost will be a combination of a base rate that includes room and board, most utilities (cable and phone are generally extra), and group amenities like activities, transportation, and communal meals. In addition to the base cost, any additional care services needed will have to be add-ons. Services like medication management, toileting, bathing, or safety checks will all be charged as personal care in addition to the base rent.
Personal care costs can add up quickly. It’s important to understand how the assisted living facility tallies these additional costs. Some are based on a points system (time for care = cost), while others may use a tiered system.
It can be difficult to compare costs between multiple facilities. The only way to accurately predict the charges for your loved one is to request an assessment by the potential facility. This assessment is generally performed in person by a nurse or administrator and may include reviewing past and present medical records.
When planning for costs, keep in mind there may be additional costs like move-in deposits, cleaning fees, and pet fees. Also, expect to see a 3 to 6 percent cost of living increase on a yearly basis.
It’s no secret; assisted living is costly. While personal funds, such as retirement and Social Security, are the most common means of paying for assisted living, many families also manage other payment methods. For example, some families will liquidate investments, settle with a life insurance company, utilize previously purchased long-term care insurance, apply for wartime veteran benefits, or work with their banks on reverse mortgages.
Pro Tip: For those who prefer to remain in their homes, a cost-effective alternative to assisted living is a medical alert system. Check out my pick for this year’s best medical alert system.
Generally, Medicare will not cover the costs of assisted living, as it will only cover the costs of a short-term stay in a skilled nursing or rehabilitation facility. Assisted living is technically not a medical expense and therefore doesn’t qualify.
Age-related programs like Medicare will only cover senior care facility expenses related to skilled nursing; in other words, those facilities that are deemed medically necessary. Other programs, like Medicaid, might cover some of the assisted living costs. Medicaid, which offers government aid to low-income older adults and people with disabilities, often will.
Generally, health insurance does not cover the costs of assisted living; however, this varies by provider. On the other hand, a long-term care insurance policy can be used to cover these costs. Be sure to plan ahead with a long-term care policy, as many providers will deny coverage if you have preexisting conditions such as Alzheimer’s, Parkinson’s, or multiple sclerosis.
The VA will not pay for assisted living facilities for veterans. With that said, eligible persons may apply for VA Aid and Attendance benefits. For those who have vision issues or require daily assistance with normal tasks, this type of funding can certainly offset some of the costs of assisted living.
Luckily, some or all of your assisted living costs may be tax deductible, qualifying for the medical expense tax deduction. To qualify for this deduction, a person must fit the IRS’s definition of “chronically ill,” meaning that they are unable to perform two or more daily acts, including bathing, dressing, eating, and using the toilet. A licensed health care practitioner can certify this status.
Top Tip: I would strongly urge you to choose an assisted living facility close to where your loved ones are so that they can visit more frequently. At the same time, remember that facilities tend to get cheaper the further they are from major metropolitan areas.
Above all, as we enter our years of retirement, many of us just want to relax, rather than lug around groceries or maintain our home. If you don’t see the need for 24/7 medical assistance offered at a nursing facility but want help with day-to-day living, then the best way forward is choosing one of the best assisted living facilities.
While the average assisted living provider charges around $55,620 per year, a private room in a nursing home (with everything from medical care to rehabilitative care) will cost nearly double this. Despite its seemingly high costs, assisted living is the most value-based option of the lot, without compromising on the needs of otherwise independent older adults.
If assisted living is not for you, then I’d recommend reading my guide to assisted living alternatives.
While independent living (or living at home with family caregivers) costs less than living in an assisted facility, you may not be able to have easy access to daily social interactions and entertainment that are so important to one’s well-being. This is a big advantage offered by assisted living facilities. Also, choosing an assisted living facility will ease the mental and physical burden on your family caregiver.
As of 2022, Missouri, Alabama, and Utah have some of the most affordable assisted living facilities, starting as low as $3,000 per month.
Finding out the staff-to-resident ratio at designated assisted care facilities can help you understand how much personal care each resident receives. Be warned that the more staff the facility employs, the higher it will drive up the rentals.
