How to Pay for Assisted Living in Michigan

After cost, the next question is always: how do we pay for this?

Most families assume they have two options, private savings or "we cannot afford it." That is not true. Michigan has several programs designed specifically to help families pay for care, and there are federal benefits that many families qualify for but never apply for, because nobody told them they existed.

I am going to walk through every major option. Some are straightforward. Some are complicated. All of them are worth understanding.

Social Security and Retirement Income

This is where most families start. As of July 2026, the average Social Security benefit for a retired worker is about $2,086 a month. For some seniors it is higher, for many it is lower, and either way it rarely covers the full cost of care on its own.

But it is the foundation. Social Security plus pension income, if there is one, is usually the first layer, and everything else builds on top of it.

One thing families do not always realize: if your loved one moves into a licensed adult foster care home and qualifies for Supplemental Security Income, Michigan adds a state supplement on top of the federal SSI payment. For personal care in 2026 the combined monthly check comes to $1,151.50.

It matters who holds that money, and families usually get this backwards. The state does not pay the care home. The check goes to the resident, or to their representative payee, and the resident is the one responsible for paying the home. Out of that $1,151.50, up to $1,107.50 goes to the provider and at least $44.00 stays with the resident as a personal allowance for incidental needs. The $44 is carved out of the check rather than added on top of it, and it can be more than $44 if the actual cost of care is lower or the resident has other unearned income.

This is nowhere near the full cost of private-pay care, and it is not what a private-pay family should expect to budget. For a household living on SSI alone, it is a starting point rather than an answer.

The MI Choice Waiver Program

This is Michigan's biggest and most underused program for paying for assisted living, and most families have never heard of it.

The MI Choice Waiver is a Medicaid program that pays for care services, not room and board, but the actual care, for people who would otherwise need nursing home care yet can live in a community setting instead. That includes licensed adult foster care homes like ours.

Here is who qualifies in 2026:

• Age 65 or older (or 18 or older with a disability)
• Medical need: you must require a nursing facility level of care, determined through an assessment
• Income: up to $2,982 per month
• Assets: up to $9,950 for a single applicant. A spouse who stays in the community keeps half the couple's countable assets, with a floor of $32,532 and a ceiling of $162,660. The floor is the number that matters for most families

The program covers more than twenty types of services, including personal care assistance, medication management, and care coordination.

Here is the catch. The MI Choice Waiver is not an entitlement. There are a limited number of slots, about 20,000 statewide, and when they are full, you go on a waitlist. Wait times vary, from months in some regions to longer in others. Priority goes to people currently in nursing homes who want to move back to the community.

For Oakland County, the agency that manages MI Choice is AgeWays (formerly the Area Agency on Aging 1-B), based in Farmington Hills. Their number is (800) 852-7795. Call them. Even if there is a wait, getting on the list is the first step.

The application process takes up to three months. You will need Social Security cards, Medicare cards, bank statements going back five years, and documentation of assets. Start gathering those now, even if you are not sure your family will need the program. Being prepared saves weeks.

VA Aid and Attendance

If your loved one is a wartime veteran, or the surviving spouse of one, this benefit alone can cover a significant portion of assisted living costs. And most eligible families never apply.

The VA Aid and Attendance benefit is an enhanced pension for veterans who need help with daily activities. In 2026, the maximum monthly amounts are:

• Single veteran: $2,424 per month
• Married veteran: $2,874 per month
• Surviving spouse: $1,558 per month

Those are real numbers. For a single veteran, that benefit can cover a meaningful portion of the monthly cost of a small adult foster care home.

To qualify, the veteran must have served at least 90 days of active duty with at least one day during a wartime period: World War II, the Korean War, Vietnam, or the Gulf War era including post-9/11. The veteran or surviving spouse must need help with daily activities like bathing, dressing, or eating.

The net worth limit is $163,699 in 2026, not counting the primary home or personal vehicle. The VA does look back three years at any large asset transfers, so plan accordingly.

You can apply through the VA directly, through a Veterans Service Organization like the VFW or American Legion, or through an accredited claims agent. The application form is VA Form 21-2680.

I bring this up because we have had families in our homes who were paying entirely out of pocket for months before someone mentioned the VA benefit to them. They had no idea it existed. If your parent or spouse served during wartime, look into this immediately.

Medicaid

Medicaid in Michigan does not pay for assisted living the way most people think. It pays the full cost of nursing home care, but for assisted living and adult foster care, the coverage is more limited.

What Medicaid does provide for adult foster care residents:

• A personal care supplement of $250.92 per month, paid to licensed adult foster care homes that are enrolled to receive it. Not every licensed home is enrolled, so it is a fair question to ask directly
• Healthcare coverage through ABD Medicaid (Aged, Blind, and Disabled) for those who qualify
• Access to the MI Choice Waiver program described above

The income limit for ABD Medicaid, which Michigan's own policy calls AD-Care, is $1,325 per month for a single person, and the asset limit is $9,950. That income figure is 100 percent of the federal poverty level plus a $20 disregard on Social Security income, which is why it does not match the poverty level divided by twelve. It also moves on a different clock from most Medicaid numbers: this one changes on April 1, not January 1.

For families whose loved one has very limited income and assets, the combination of SSI, Medicaid supplements, and the MI Choice Waiver can make adult foster care affordable. It is not simple to navigate, but it is possible. A Medicaid planning attorney or the team at AgeWays can help you understand what your family qualifies for.

Long-Term Care Insurance

If your loved one bought a long-term care insurance policy years ago, now is when it pays off. These policies typically cover a daily or monthly benefit toward the cost of assisted living, including adult foster care.

The reality is that only about 7 to 10 percent of Americans have long-term care insurance. If your family has a policy, check the terms carefully. Look at the daily benefit amount, the elimination period (usually 30 to 90 days before benefits begin), and the maximum benefit period. Older policies may define a covered care setting differently than newer ones.

If your family does not have a policy, it is too late to buy one affordably for someone who already needs care. But for adult children reading this and thinking about their own future, long-term care insurance is worth considering while you are still healthy enough to qualify.

Other Options Worth Knowing About

Home equity. If your loved one owns a home, that equity is a potential funding source. A reverse mortgage (HECM) lets homeowners age 62 and older convert equity into cash. One caution: if the homeowner moves out for more than twelve consecutive months, the loan becomes due. This works better for funding a spouse's care while one person remains in the home.

Life insurance conversion. Some life insurance policies include an accelerated death benefit rider that allows early access to the death benefit if the policyholder is chronically or terminally ill. There are also life settlements and viatical settlements, which involve selling the policy to a third party, though these come with trade-offs and should be discussed with a financial advisor.

PACE Southeast Michigan. The Program of All-Inclusive Care for the Elderly covers medical care, medications, and care services for people age 55 and older who meet nursing facility level of care criteria. It is a lesser-known option that some families find very helpful. One caution before you get your hopes up: it serves parts of Oakland County rather than all of it, by named city, and Troy is not among them. Their line is (855) 445-4554, option 2, and they will tell you in a minute whether your parent's address is covered.

Putting It Together

Most families do not pay for assisted living with a single source. They combine two or three: Social Security plus VA benefits, pension income plus long-term care insurance, or Medicaid programs plus family contributions.

The key is to start exploring options before you need them. Applying for the MI Choice Waiver when your parent is already in crisis means waiting months while paying full cost out of pocket. Discovering the VA benefit after a year of private pay means twelve months of benefits you could have had.

I know this is overwhelming. There is a lot of information here, and none of it is simple. But you do not have to figure it out alone. We have helped families work through these options many times, and we are happy to point you in the right direction even if Golden Pines is not where your loved one ends up.

Call us at (248) 266-2738 or email [email protected]. We have been through this process with enough families to know where the shortcuts are and where the landmines are. We are glad to help.