According to CalMatters Housing, Health Net, one of the nation's largest Medi-Cal insurers, is discontinuing its assisted living benefit for approximately 3,500 low-income seniors by the end of the year. These patients, mostly elderly individuals with cognitive issues like dementia, currently rely on this coverage to help pay for board-and-care and memory care facilities. The decision has created significant uncertainty for families who fear their loved ones could become homeless or cycle through hospitals without adequate housing support. Matt Johnstone, whose 89-year-old father with dementia depends on this benefit, expressed panic about the situation, noting that the roughly 6,000 dollar monthly cost of care is unaffordable without insurance and that his family cannot safely provide the necessary around-the-clock care at home.
Health Net's assisted living benefit is part of CalAIM, California's program to improve Medi-Cal services by stabilizing high-cost users who frequently use emergency rooms. The benefit covers most 24-hour service costs at facilities, while residents pay room-and-board fees. According to the reporting, this optional benefit costs between 5,000 to 7,000 dollars monthly, compared to nursing homes which run over 10,000 dollars monthly. The state created this assisted living support to relieve pressure on a separate state-managed program that has an 18,000-person cap and a multi-year waitlist.
The termination decision has been communicated with minimal transparency. According to CalMatters, some family members learned about the changes from facility staff rather than from Health Net directly, and customer service representatives reportedly had no knowledge of the program. Jennifer Horcasitas-Glenn, whose mother-in-law with dementia and Alzheimer's is in a memory care facility, spent days calling Health Net without receiving answers and was eventually directed to send questions via email without getting responses.
Health Net told state regulators that its decision to terminate the benefit was driven by unexpected enrollment patterns and data suggesting the program did not reduce emergency room visits or hospitalizations as intended. The company also cited concerns about program sustainability under new state guidance. However, senior advocates like Hagar Dickman from Justice In Aging interpret this differently, suggesting Health Net views offering no services as more cost-effective than continuing partial coverage.
The company stated it would transition affected members to nursing homes, in-home supportive services, or other available programs based on clinical needs, and that it is working with providers and care management teams on individual plans. The Department of Health Care Services said it would communicate with Health Net to ensure member protections and continuity of care, though the department declined to provide additional comment. According to CalMatters, advocates worry that without stronger consumer protections, some residents have already been left vulnerable, with a few facilities reportedly dropping residents at emergency rooms.
What I am seeing locally is that this kind of coverage decision sends shockwaves through our entire region. When a major insurer pulls back from serving vulnerable seniors in the Bay Area and East Bay, it affects not just those individuals but the entire network of care facilities and family members trying to navigate an already complicated system. The lack of communication and transparency makes it harder for families to plan ahead, and that uncertainty is something I hear about regularly from clients dealing with multi-generational housing situations and long-term care questions.
