Paying for senior care almost never comes from one place. Most families stitch together several payers: Medicaid, Medicare, VA benefits, and private money. Each one covers different care, for different people, under different rules. This guide explains who pays for what, who qualifies, and how the pieces fit together.

Start with the five payers below. Then read the deeper section on whichever one fits your family.

What Senior Care Costs

Before you figure out who pays, know the bill. These are national medians for 2026. Your state and metro area can run well above or below them.

Care Type Median Monthly Cost Median Annual Cost
Adult day health care about $2,000 about $24,000 - $26,000
Assisted living about $5,900 about $70,800
Home health aide about $6,483 about $77,792
Nursing home (semi-private room) about $9,277 about $111,325
Nursing home (private room) about $10,646 about $127,750

These figures come from the Genworth/CareScout 2024 Cost of Care Survey, the most recent national data. Costs have been climbing faster than general inflation, commonly 1% to 12% a year by category. At about $9,277 a month, two years in a semi-private nursing home room runs past $220,000. That math is why almost every middle-class family ends up combining payers.

Who Pays for What

Here's the quick comparison. Each payer is broken out in detail below.

Payer What It Covers Who Qualifies
Medicaid Long-term nursing home care, in-home and assisted living services Low income and assets; meets a medical need standard
Medicare Up to 100 days of skilled nursing after a hospital stay; home health visits Anyone 65+ or on disability; not for custodial care
VA benefits Cash toward any care setting Wartime veterans and surviving spouses who need daily help
Long-term care insurance Home care, assisted living, nursing home up to a policy limit People who bought a policy and meet its benefit triggers
Private pay Anything Anyone with savings, home equity, or convertible assets

Medicaid

Medicaid is the biggest payer for long-term senior care in the country. It covers nursing home care, in-home services, and care services in assisted living for people who qualify financially and medically. It's the payer most families land on once savings run low.

Because Medicaid is means-tested, eligibility turns on income and assets. A single applicant for long-term care Medicaid generally needs countable assets under about $2,000 and monthly income at or below roughly $2,982 (300% of the federal Supplemental Security Income (SSI) benefit rate). A few rules matter most:

  • Spousal protections. When one spouse needs care and the other stays home, the at-home spouse can keep a share of the couple's assets. For 2026 that Community Spouse Resource Allowance runs from a $32,532 minimum to a $162,660 maximum, depending on the state, plus a monthly income allowance of up to $4,066.50.
  • The home equity cap. The primary home is usually exempt, but only up to an equity limit. For 2026 that cap ranges from $752,000 to $1,130,000, set by each state.
  • The 5-year look-back. Medicaid reviews 60 months of financial records before the application date. Gifts or below-market transfers in that window trigger a penalty period when Medicaid won't pay.

These rules are where families make expensive mistakes, and where legal planning can protect assets. The mechanics get detailed, so we cover them separately rather than repeating them here. See our guides to Medicaid planning strategies and estate recovery.

Medicare

This is where families get surprised. Medicare does not pay for long-term care.

What Medicare covers is short-term skilled care. After a qualifying inpatient hospital stay of at least three days, Medicare Part A covers up to 100 days in a skilled nursing facility per benefit period: days 1 through 20 in full, days 21 through 100 with a daily copay, and nothing after day 100. It also covers home health visits for skilled nursing and therapy when a doctor orders them.

What it doesn't cover is custodial care: ongoing help with bathing, dressing, eating, and other daily activities when that's the only care needed. Assisted living, long-term nursing home stays, and non-medical home care all fall outside Medicare. For those, families rely on Medicaid, VA benefits, insurance, or private pay.

VA Benefits and Aid and Attendance

If your loved one is a wartime veteran or the surviving spouse of one, the VA can add real money each month. The benefit is called VA Aid and Attendance, a pension add-on for those who need help with daily living.

The 2026 monthly maximums are:

  • Veteran with no dependents: up to $2,424
  • Veteran with one dependent: up to $2,874
  • Surviving spouse: up to $1,558

To qualify, the veteran must have served during a wartime period, need help with daily activities, and fall under a net worth limit of $163,699 (the home, vehicles, and basic household goods don't count). The VA applies a 3-year look-back on asset transfers, separate from the Medicaid look-back. This money can go toward any care setting: home care, assisted living, or a nursing home.

Private Pay

When government programs and insurance don't cover everything, families pay the rest themselves. Here are the four most common sources.

Out-of-Pocket and Savings

Most families start here. Retirement accounts, pensions, and Social Security income are the usual sources. The risk is duration: long-term care can last years, and at the costs above, savings drain fast. Plan for how long the money lasts, not just whether it covers the first month.

Long-Term Care Insurance

If your loved one bought a long-term care policy years ago, this is when it pays off. These policies cover home care, assisted living, and nursing home care up to a daily or monthly benefit. Dig out the policy now and read the benefit triggers, daily maximum, and elimination period before you need it. New policies are expensive and hard to qualify for after 65, so this is mostly a tool for people who planned ahead. The federal consumer resource at longtermcare.acl.gov explains how these policies work.

Reverse Mortgages

For homeowners 62 and older, a reverse mortgage converts home equity into cash with no monthly mortgage payment. The federally insured version is the Home Equity Conversion Mortgage (HECM). It can fund home care or assisted living while the borrower stays in the house. Watch the interaction with Medicaid: money you pull out but don't spend in the month received counts as an asset the next month, which can push you over the limit.

Life Insurance

An existing life insurance policy can sometimes fund care. Some policies offer an accelerated death benefit that pays out early if the policyholder is terminally ill or needs long-term care. Others can be sold through a life settlement for a lump sum, or borrowed against if they carry cash value. Check the policy terms before assuming any of these apply.

Frequently Asked Questions

No. Medicare covers up to 100 days of skilled nursing care after a qualifying hospital stay, plus home health visits. It does not pay for assisted living, long-term nursing home stays, or non-medical custodial care. For those, you need Medicaid, VA benefits, long-term care insurance, or private pay.

Being over the income limit doesn't automatically disqualify someone. Many states allow a Qualified Income Trust (also called a Miller Trust) that redirects income above the limit so the applicant can still qualify. The asset rules and spousal protections also leave more room than families expect. An elder law attorney can tell you what applies in your state.

Yes, and most do. A veteran on Medicaid can also receive VA Aid and Attendance. Someone private-paying for assisted living today may move to Medicaid later as savings run down. Medicare covers a rehab stay while the family lines up longer-term funding. The payers are designed to stack.

Legally, through planning done well before the 5-year look-back window closes. Spousal protections, exempt assets, and certain trusts can preserve a surprising amount. The mistake to avoid is gifting money or transferring the house on your own inside the look-back, which can create a penalty period. Talk to an elder law attorney before moving any large sum.

Possibly, through Medicaid estate recovery, which lets states recoup long-term care costs from the estate. There are exceptions and protections, especially for a surviving spouse. Our estate recovery guide walks through how it works and what's protected.

Next Steps

Work it in this order:

  • Price the care. Figure out what level of care your loved one needs now and what it costs in your area.
  • Check Medicaid. Look at income, assets, and spousal protections. This is the payer most families end up using.
  • Check VA eligibility. If your loved one is a wartime veteran or surviving spouse, Aid and Attendance may add hundreds a month.
  • Inventory private resources. Savings, an old long-term care policy, home equity, life insurance.
  • Get help mapping it. An elder law attorney or a care advisor can tell you how the pieces fit for your family.

Your state changes the details: limits, waitlists, and which programs exist. Read your state's guide for the specifics.

Learn More

Find personalized help figuring out how to pay for senior care at brevy.com.

The information on Brevy.com is for educational purposes only and is not a substitute for professional legal, financial, or medical advice. Rules vary by state and program and change frequently. Always verify with the relevant agency or a qualified professional. Brevy is not a law firm, financial advisor, or healthcare provider.

BC

Brevy Care Team

Expert eldercare guidance from Brevy's team of healthcare professionals and researchers.