Under Social Security Act §1915(c) an assisted living waiver (ALW) allows states to use Medicaid dollars to pay for home-based community services. It allows low-income, Medicaid eligible seniors and persons with disabilities to avert nursing home placement and receive care at home or in a community care setting i.e., RCFEs and ARFs.
California’s ALW, implemented in 2006, allows Medi-Cal to pay for assisted living or public subsidized housing. Several websites claim the program is “experimental,” despite the passage of 20 years, and the current state budget does not cover a state-wide expansion to more counties and is limited to just 15 counties. The program came under serious scrutiny when it ran out of money in September 2025, resulting in a suspension of new placements. The number of persons awaiting placement—the waitlist—swelled, but the actual number on the state’s waitlist is now suspicious.
Justice in Aging recently wrote that the ALW had 18,847 persons currently enrolled in the program, but just as many on a waitlist.
ALW qualifies low-income persons on the SSI or Supplemental Security Income grant of $1444.07 (2026) and eligible for nursing home care but they prefer community-based care. The SSI grant is in addition to a daily, ALW rate for care and services, up to $264 a day, or $9367 per month if the person’s care needs are at “Tier 5,” the highest level of care.
DHCS has nearly 1300 care facilities that can admit ALW-dependent persons. The where a resident goes is “brokered” by one of the state’s 41 designated Care Coordination Agencies (CCA), and placement is determined by registered nurses employed by CCAs. Paying those nurses strains the ALW budget and some facilities are paying “kickbacks” to the CCAs.
In California, there are about 14 million persons on welfare, 35% of the state’s population! Over 50% of Medi-Cal recipients are between 21 and 64 years old, and over 50% are Hispanic. Many recipients are illegally in the country because California allows illegals to get federally-paid placements and housing, a violation of federal law, and that has not gone unnoticed. The federal government has withdrawn nearly $1 billion in state payments.
Illegals do not pay social security taxes because they cannot be legally employed. Yet, California allows illegals to collect US taxpayer-paid social security benefits. The state’s philosophy is:
The administration of the ALW program is complicated because state law allows CCAs to subcontract some of its programs’ activities:
How this ends is unknown, but under current California governance, the program will end because of fiscal mismanagement.