Medicare Coverage Requirements for Long-Term Care and Assisted Living Facilities
Medicare does NOT cover long-term care facilities or assisted living—it only covers up to 100 days in a Skilled Nursing Facility (SNF) for post-acute rehabilitation, and provides NO coverage for custodial long-term nursing home care. 1
Critical Distinction: What Medicare Does and Does NOT Cover
Medicare DOES Cover: Skilled Nursing Facilities (Short-Term Only)
To qualify for Medicare SNF coverage, patients must meet ALL of the following requirements:
- The 3-Midnight Rule: Patient must have a qualifying hospital stay of at least 3 consecutive midnights as an inpatient (not observation status) 2, 3
- Medical Necessity: Patient requires daily skilled nursing care or rehabilitation services that can only be provided in an inpatient setting 1
- Physician Certification: A physician must certify that skilled services are medically necessary 1
- Admission Timing: SNF admission must occur within 30 days of hospital discharge 2
- Coverage Duration: Medicare covers up to 100 days maximum per benefit period in a SNF 1
Medicare Does NOT Cover: Long-Term Care or Assisted Living
Medicare explicitly excludes coverage for:
- Long-term nursing home care (custodial care) 1
- Assisted living facilities 1
- Care that is primarily for assistance with activities of daily living without skilled nursing needs 1
Skilled Nursing Facility (SNF) Qualification Details
Required Skilled Services
Patients must need ONE OR MORE of the following skilled services: 1
- Daily skilled nursing care (wound care, IV medications, catheter management)
- Rehabilitation therapy (physical therapy, occupational therapy, speech therapy) at least 5 days per week
- Services to maintain function or prevent deterioration when skilled intervention is required
- Complex medical management requiring nursing expertise beyond what family/aides can provide
SNF Staffing Requirements
Medicare-certified SNFs must provide: 1
- Rehabilitation nursing on-site minimum 8 hours daily, 7 days per week
- Care following a physician's treatment plan (though daily physician visits not required)
- Physically distinct unit within a nursing home or hospital if co-located
Coverage Limitations and Payment
Important coverage restrictions: 1
- Days 1-20: Medicare pays 100% of approved costs
- Days 21-100: Patient pays daily coinsurance (substantial out-of-pocket cost)
- After day 100: Medicare coverage ends completely
- Patient must continue to require skilled services throughout the stay—if needs become custodial only, Medicare coverage terminates even before 100 days
What Happens After Medicare SNF Coverage Ends
When patients can no longer return to community living and require ongoing care: 1
- Long-term nursing home care must be paid through:
- Out-of-pocket private payment
- Long-term care insurance (if patient has policy)
- Medicaid (after spending down assets to qualify)
- Assisted living facilities are never covered by Medicare and require:
- Private payment
- Long-term care insurance
- Some state Medicaid programs (varies by state)
Common Pitfalls to Avoid
Critical errors in understanding Medicare coverage: 1, 2
- Observation status does NOT count: Hospital time spent in observation status does not count toward the 3-midnight requirement—only formal inpatient admission counts 2
- The 30-day window: If more than 30 days pass between hospital discharge and SNF admission, the benefit is lost 2
- Benefit period resets: A new 60-day period without hospitalization or SNF care is required to start a new benefit period with fresh 100-day coverage 4
- Skilled need must persist: If patient's condition stabilizes to where only custodial care is needed, Medicare coverage stops immediately, even if within the 100-day window 1
Alternative Medicare Coverage Options
Home Health Care (For Community-Dwelling Patients)
Medicare covers home health services when: 1
- Patient is certified as homebound by a physician (unable to leave home except for medical care)
- Patient requires skilled nursing or therapy services
- Coverage includes 60-day episodes, renewable if clinically justified
- Services can be provided in assisted living facilities but are not reimbursed if duplicative of facility services
Inpatient Rehabilitation Facilities (IRF)
For patients needing intensive rehabilitation (alternative to SNF): 1, 5
- Requires ability to tolerate 3 hours of therapy daily, 5 days per week
- Expectation of significant functional improvement
- Daily physician supervision required
- Typically shorter stays (median 15 days) with more intensive therapy than SNFs
- Still requires the 3-midnight qualifying hospital stay