Long Term Care Costs
Receiving long term care can mean more than paying hefty bills. Learn the average cost of professional care and the personal costs to family members providing care.
Needing long term care looms in the future for most Americans. If you’ve been a caregiver you’ve experienced the demands on lifestyle and health and you’ve most likely have dealt with bills for outside help and facility care. The cost of care is high no matter how you measure it. It’s costly to the health and lifestyle of family caregivers and costly to lifetime savings when professional care is hired.
The Personal Cost of Caregiver Stress
Most long term care is still provided at home by a loved one 59% of care is unpaid. Family members providing long term care often pay a high personal price. Most informal caregivers are still working while providing for the safety and comfort of a family member. For many, their careers suffer affecting their income and their retirement savings. The average out-of-pocket costs for a family caregiver averaged $7,000 in 2016. The negative health effects of being an unpaid long term care giver can be costly, too. Relationships with children and spouses can suffer. And the toll on health can last a lifetime. Many caregivers suffer from chronic stress, sleep deprivation and the ailments that those conditions can cause.
By being prepared to pay for long term care, you can help protect those closest to you from the burdens of being a caregiver. Even a small long term care insurance plan can provide much needed support for your family members. Studies show that family caregivers that have adequate support and a positive perspective can feel fulfillment and satisfaction from taking care of those they love.
Average Cost of Long Term Care
According to the U.S. Government Administration for Community Living, the average national costs for long term care in 2016 were as follows.
- $253/day or $7,698/month for a private room in a nursing home
- $119/day or $3,638/month for a one-bedroom unit in assisted living
- $20.50/hour for a home health aide
Based on the national averages a year of care in 2016 would have cost over $92,000 in a private nursing home room. Assisted Living (base cost) would have cost nearly $44,000 per year. And a year of care at home (40 hours/week) would have cost about $42,000. Like everything else, the costs have been rising every year. In 2020 the national mean cost for a private room in a nursing home is around $106,000 per year, a year of assisted living is nearly $52,000 per year and 40 hours per week of home care is about $50,000 per year.
Who Pays for Long Term Care?
A common misconception is that Medicare pays for long term care. In fact, Medicare.gov explicitly states “Medicare doesn’t cover long-term care (also called custodial care)”. While most home care is provided by unpaid caregivers like spouses and adult children, 42% of paid care was provided by Medicaid 2016 statistics.
What does that mean for you?
- Medicaid provides a safety net if everything “goes south”.
- Relying on Medicaid means
- Qualifying financially – Medicaid is designed to support those who can’t provide for themselves.
- Receiving care where Medicaid assigns you. Because of the overwhelming use of this combined state and federal government resource, approved facilities and services must provide care at low cost to the government. And care must be restricted to those in direst need. In other words, if long term care costs devastate your financial resources Medicaid has your back. But you sacrifice the ability to choose where and how you receive care. And let’s be real, most of us would rather sleep in our own beds, eat home cooking and spend our days in the familiar comfort of our own homes.
Since most people over 65 will need long term care, planning ahead for long term care costs just makes sense. Although long term care insurance isn’t for everyone, it can be a powerful tool.
- Leverage your money.
- Shelter your savings.
- Ease the burden to your loved ones.
- Provide a measure of freedom on where and how you receive care.
Next Steps:
Take time to review your retirement savings plan for tips on how you can prepare for long term care costs. Book a no risk, no commitment complimentary review. You can research the cost of care in the area you plan to retire by clicking the link below.