Half Of Amer­i­cans Are Likely To Spend A Night In A Nurs­ing Home

ForbesWeekly - - NEWS - BY BRUCE JAPSEN, FORBES CON­TRIB­U­TOR FOL­LOW BRUCE JAPSEN AT www.forbes.com/sites/bruce­japsen

More than half of Amer­i­cans ages 57 to 61 will “stay in a nurs­ing home at least one night dur­ing their life­time,” which is much ear­lier in life than per­vi­ous es­ti­mates, ac­cord­ing to new re­search from RAND Corp.

The new study is in con­trast to ear­lier es­ti­mates from the U.S. De­part­ment of Health and Hu­man Ser­vices that say only 35% of older Amer­i­cans are likely to use a nurs­ing home later in their life­times.

“We found that 56% of per­sons aged 57–61 will stay at least one night in a nurs­ing home dur­ing their life­times , but only 32% of the co­hort will pay any­thing out of pocket,” said the study, led by RAND re­searchers and pub­lished on­line in the Pro­ceed­ings of the Na­tional Acad­emy of Sciences.

The in­crease may be due to the in­crease in the num­ber of shorter stays in nurs­ing homes. Ag­ing baby boomers are known to need nurs­ing home care for myr­iad con­di­tions in later life, from knee and hip re­place­ments to heart surg­eries, and in­creas­ingly, re­cov­ery is out­side the hos­pi­tal and in a nurs­ing home fa­cil­ity thanks to re­forms of Med­i­caid and Medi­care in­sur­ance.

In part be­cause the stays are shorter, only about one-third of these Amer­i­cans will pay any­thing out of pocket for their care. “Av­er­aged over all per­sons, to­tal out-of-pocket ex­pen­di­tures look­ing for­ward from age 57 were ap­prox­i­mately $7,300, dis­counted at 3% per year,” RAND re­search shows. “How­ever, the 95th per­centile of spend­ing was al­most $47,000.”

Re­searchers said the study is im­por­tant for Amer­i­cans as they plan for their health-care needs and re­lated costs as they be­come older. “This in­for­ma­tion could help peo­ple make bet­ter de­ci­sions about how they or their loved ones will pay for the care they are likely to need,” Michael Hurd, lead au­thor of the study and a se­nior prin­ci­pal re­searcher at RAND, said in a state­ment ac­com­pa­ny­ing the re­port.

Just one in 10 among those age 60 and older buy long-term-care in­sur­ance given the avail­abil­ity of Med­i­caid cov­er­age, which has ex­panded to mil­lions of Amer­i­cans un­der the Af­ford­able Care Act. “One im­por­tant rea­son for this low take-up (of long-term care cov­er­age) is that Med­i­caid pro­vides in­sur­ance of last re­sort,” RAND re­search shows.

The study was based on “18 years of data” drawn from the Health and Re­tire­ment Study, which is a project of the Na­tional In­sti­tute on Ag­ing and the So­cial Se­cu­rity Ad­min­is­tra­tion. The in­sti­tute on ag­ing funded the re­search, RAND said.

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