People approaching age 65 might want to think about more than just a retirement fund. Especially if they don’t make much money.

Developers in Louisville are banking on an explosion of the elderly population living on inheritances by building more out-of-pocket assisted and independent living facilities.

But, assisted living facilities — for seniors who receive some health care but do not require a nursing home — can start at around $6,000 a month. Independent living facilities, which don’t come with health care benefits, can run half that.

Masonic Homes of Kentucky, a senior living provider, is breaking ground Wednesday on The Meadow, a 122-apartment community in Louisville.  Apartments — designed for seniors age 62 and older — will start at $218,000 and include a cleaning service, meals, maintenance and social/recreational services. The $44 million facility, though not yet built,  is already at 84 percent capacity.

masonic homes of kentuckyCourtesy Masonic Homes of Kentucky

Rendering of The Meadow, a new $44 million independent living community

Charlaine Reynolds is owner of Aging Transitions, which helps connect seniors with the right resources – home health care, a Medicaid nursing home or an out-of-pocket independent living facility. Reynolds said the opening of the new independent living community is part of a larger trend in Louisville.

She said developers are betting on baby boomers – those between the ages of 52 and 70 – to inherit money from their parents.

“Developers are counting on the transfer of wealth to happen so that the baby boomers will be able to fund their retirement,” Reynolds said.

Medicare, which people qualify for at age 65, doesn’t pay for long-term care. It does does cover short-term care –like a rehab facility — after a major ailment like a hip fracture, for example. Medicaid does pay for long-term housing, but seniors would have to spend down all their assets to qualify, and there are long waiting lists for Medicaid facilities.

“For a for-profit nursing facility, there’s not a lot of money to be made in taking on a Medicaid patient,” said Reynolds. “Even for-profits still have to pay the bills, and it’s very expensive to take care of people.”

Baby boomers – who make up one-third of current Louisville residents — are getting older.   And not all those people will be able to afford a retirement home.

“It is a daunting task to provide [housing and health care] to so many more people, number wise, in the community we live in right now,” said Anna Faul, executive director at the Institute of Sustainable Health and Optimal Aging at the University of Louisville.

Faul said people who make a lot of money will mostly be all right because they’ll be able to pay for out-of-pocket facilities. And the people making below the poverty limit will have access to Medicaid long-term care. She said for others, long-term care insurance can pay for health care bills and assisted living facilities and fill a gap for the middle class.

“It’s the people in the middle that can’t afford out of pocket and don’t qualify for public support – that’s the people the long-term care policies are for,” Faul said.

She recommends buying sooner rather than later because premiums go up the older and sicker you are.

For those seniors who purchase dwellings at the Masonic Living independent apartments, there’s an added benefit – if a resident gets sick and needs a higher level of care, they get automatic admission. And the price won’t increase whether a nursing home is needed in five or 30 years.

“They have predictable monthly expenses,” said Nicole Candler, senior vice president of communications of Masonic Homes. “Knowing down the road, that this is what you’re going to pay for memory care, it allows you to better pay for that, as opposed to paying the market rate whenever you need those services.”

And if the senior can no longer be in independent living, Masonic Homes will sell their home, with a 90 percent return on the initial price back to the senior.