Report: Long-term care costs spike again
Nursing home care may top $100k per year; labor costs, sicker patients blamed for surge
Long-term care costs are surging again and the most expensive option — a private nursing home room — may soon top $100,000 per year.
Growing labor expenses and sicker patients helped push the median cost of care that includes adult day care and assisted living communities up an average of 4.5 percent this year, according to a survey released Tuesday by Genworth Financial. That’s the second-highest increase since Genworth started its survey in 2004.
The cost of home health aide services climbed the most, rising 6 percent, to $21.50 an hour. Private nursing home care now costs more than $97,000 annually.
Many Americans don’t plan for expenses like these or understand them until they face them, said Joe Caldwell of the National Council on Aging, which is not tied to Genworth’s study.
“People don’t like to think about it and talk about it ahead of time, so they kind of put off planning and saving for it financially because they don’t think it’s going to happen to them,” he said.
Long-term care costs can impose a crushing financial burden on individuals or families in part because private health insurance and Medicare, the federal program for people over age 65, offer only limited help. That can force people who don’t have private coverage to spend down their assets until they qualify for the government’s health insurance program for the poor, Medicaid.
Genworth Financial Inc. sells long-term care coverage and didn’t address that cost in its national study, which was based on information from 15,000 long-term care providers.
Coverage costs are rising as well. Initial premiums for long-term care coverage can cost well over $2,000 annually, depending on the customer’s age, according to the Bipartisan Policy Center, which researches health care issues.
For 2017, long-term care prices climbed in part because the cost of labor rose, according to Genworth.
Genworth researchers say costs also are rising because care providers are working with patients that have more complex medical needs and live longer than they did a decade ago. Plus Medicaid offers reimbursement that can fall below the cost of care, which forces long-term care providers to make that up in their prices.