Does ALTCS Pay for Assisted Living in Arizona?

Yes. And this is one of the things that makes Arizona's Medicaid long-term care program genuinely different from most states.

In a typical state, Medicaid automatically covers nursing home care but puts assisted living and home care on a separate Home and Community Based Services (HCBS) waiver with its own waitlist — sometimes months or years long. Arizona eliminated that split. ALTCS operates as a single managed-care system where approved members receive funding for whatever care setting matches their needs, including assisted living communities, small residential group homes, memory care facilities, and in-home services.

What ALTCS Covers Beyond Nursing Homes

Once approved, an ALTCS member's assigned managed-care contractor (Mercy Care or Banner University Family Care) authorizes services across a wide range of settings:

Assisted living facilities — Licensed communities providing personal care (bathing, dressing, medication management) and supervisory care (meals, laundry, safety oversight). Arizona's Department of Health Services licenses these at three tiers: Supervisory, Personal, and Directed Care.

Memory care — Specialized locked units for residents with Alzheimer's or advanced dementia. Since Arizona enacted House Bill 2764, any facility advertising memory care must hold a specific ADHS license subclass and meet mandatory staff training requirements: 8 hours of initial dementia training, 4 hours of annual continuing education, and background checks against the Adult Protective Services Registry.

Home and community based services — Care delivered in the member's own home. This includes home-care aide visits (bathing, meals, medication reminders), adult day health programs, respite care for family caregivers, medical equipment (wheelchairs, hospital beds), emergency alert systems, and home modifications like grab bars and ramps.

Nursing facilities — Traditional skilled nursing when the member needs 24-hour medical supervision.

The Catch: Not Every Facility Accepts ALTCS

Just because ALTCS covers assisted living doesn't mean every assisted living community will accept an ALTCS member. Facilities must be contracted with the member's specific managed-care plan (Mercy Care or Banner). Many higher-end communities either don't contract with ALTCS at all or require a minimum period of private-pay residency — sometimes 12 to 24 months — before they'll accept a Medicaid transition.

Before choosing a facility, ask three questions:

1. Are you contracted with my parent's ALTCS managed-care plan?
2. Do you require a private-pay period before accepting Medicaid?
3. What is your current ADHS license level — Supervisory, Personal, or Directed Care?

If the facility doesn't hold a Directed Care or Memory Care license but your parent needs that level of supervision, the placement won't work regardless of payment source.

How the Monthly Cost Works for Members

ALTCS doesn't cover care for free. Approved members pay a monthly "share of cost" (also called patient liability) calculated from their income. The formula:

Gross monthly income minus the Personal Needs Allowance ($149.10) minus approved Medicare premiums minus any Community Spouse income diversion = share of cost paid to the facility or home-care agency.

For a member with $1,800 in Social Security and no spouse at home, the share of cost would be roughly $1,650 per month — dramatically less than the $6,300+ monthly private-pay rate for assisted living in Arizona.

Home Care vs. Facility: The Member Chooses

A common misconception is that ALTCS pushes people into nursing homes. The program actually has a structural incentive toward home and community based services because they cost less. If your parent's PAS assessment shows they can safely receive care at home with aide visits and equipment, the managed-care contractor will build a home-care plan.

Home-care services through ALTCS typically include:

• Personal care aide visits (2-8 hours daily depending on needs)
• Adult day health attendance (structured programs, transportation included)
• Respite care (temporary relief for family caregivers)
• Home-delivered meals
• Medical alert pendant systems
• Home safety modifications

The decision between home care and facility placement is made collaboratively between the member, family, and care coordinator — not dictated by the program.

Getting Approved

ALTCS eligibility requires passing both a medical screening (PAS score of 60+) and a financial means test ($2,982 monthly income cap, $2,000 asset limit). The application takes 60 to 90 days to process.

The Arizona Medicaid Long-Term Care & Asset Protection Guide covers the full eligibility process, including how to maximize your parent's PAS score, set up a Miller Trust if income exceeds the cap, and navigate spend-down strategies to meet the asset threshold.

See more Arizona guides →