Generally, it’s estimated that dementia care costs an extra 20-30% compared to assisted living. Considering the average cost of assisted living in the United States is $4,051 per month, one can expect to pay approximately $5,000 per month for memory care. Costs may be much higher or lower depending on your location and the specific facility’s offerings, so be sure to always ask communities for their pricing directly.

While paying out-of-pocket is always an option, the high cost of memory care leads many families to seek some form of financial assistance. Some of the most commonly used forms of financial assistance for memory care are:

• Medicare: Residential memory care is not covered by Medicare. However, it does cover some services those with dementia or Alzheimer’s may need, such as 35 hours of in-home care per week and stays in nursing homes, though there are limitations to these benefits. Some seniors may also consider a Medicare Supplement Insurance, or Medigap, plan. These plans “supplement” original Medicare to expand the benefits, and some Medigap plans may cover memory care services.
• Medicaid: Medicaid does not directly cover memory care, but many states have waiver programs designed to expand coverage for services such as long-term care. Home and Community Based Services (HCBS) waivers, also referred to as 1915(c) Medicaid waivers, offer expanded Medicaid coverage for some assisted living and memory care services to prevent unnecessary moves to skilled nursing homes. The availability of HCBS waivers differs from state-to-state, but many cover personal care services that one would receive in a memory care community, making the overall cost more affordable (Medicaid does not cover room and board in long-term care facilities).  
• Reverse Mortgages: Reverse mortgages like the Home Equity Conversion Mortgage (HECM) are loans that adults over the age of 62 can take out against the value of the home that they own. This allows seniors to access some liquid value from their homes without needing to sell it immediately. Borrowers are required to pay back their reverse mortgage loan, with interest, once the homeowner moves out of the home or passes away.
• Life Insurance Settlements: Some individuals with life insurance policies may be able to “cash-out” or receive a settlement rather than using the policy for its intended purpose. For some seniors, it makes sense to use one’s life insurance benefit to finance memory care, while for others it’s wiser to maintain the original death benefit. The options one has for accessing their benefit early will depend on the type of policy they have and the insurance company they used. ‍
• Aid and Attendance Benefit: The Aid & Attendance (A&A) benefit is a monthly payment intended to help veterans and their spouses pay for long-term care services, including memory care. A&A is a tax-free sum that eligible veterans receive in addition to their monthly VA pension. You can learn more about eligibility and the benefit amount on the VA website.