Should All States Permit Use of Medicaid for Assisted Living?

The plight of 108-year-old Ohio resident Carrie Rausch, facing the prospect of losing her spot in an assisted living community because she's run out of money, is generating a lot of attention in the media, including People magazine.  Some states, such as New Jersey, have expanded the options for public assistance in senior living -- beyond nursing homes -- to permit eligible individuals to use Medicaid for residential care.  Assisted living is usually much less expensive than a nursing home; but the pool of individuals who would might opt for assisted living rather than the "dreaded" nursing home is also larger.   Ohio, along with many states, hasn't gone the AL route:  

If Rausch can’t raise the money needed, she’ll have to leave what has been her home for the past three years and move into a nursing home that accepts Medicaid.

[Daughter] Hatfield worries about the toll the move would take on her mom, who is more lively and active than most people 10 or even 20 years her junior. . . . “We need a miracle,” she says.

Ms Rausch's adult daughter -- herself in her late 60s -- has turned to GoFundMe to attempt to raise the $40k needed for a year of continued residence, and as of the date of this Blog post, more than 700 donors have responded.  

At a deeper level, however, this story reveals important questions about public funding for long-term care on a state-by-state basis. This funding issue is repeating itself throughout the country for seniors much younger than the frugal and relatively healthy Carrie Rausch.  On a national basis, GoFundMe "miracles" seem an impractical solution.