My family has been fortunate to not have had a family member spend a considerable time in the nursing home. For families that have not been as fortunate, the whole experience can be a devastating one; emotionally and financially. For those that were fortunate enough to have taken out a long term care policy are not burdened with the mounting costs for nursing home care. But long term care policies can be complex and many choose to postpone them. In this post, I want to talk about the cost of long term care in general and then have a series of posts that address other long term care issues.
Why even consider long-term care insurance?
Research has recently indicated that 69 percent of those turning 65 in 2006 can expect to use long-term care. The average stay is about 2 ½ years, or about 30 months. You think that sounds bad, it gets worse. In a study done by Genworth Financial, nursing home care in IL has gone up by 26 percent over the past 5 years. This compares to 17 percent increase nationally.
Cost of Long Term Care
The numbers get even more staggering. The study also found that one year in a private nursing home in Chicago costs $72,567 and $52,362 throughout the rest of the state. Considering that the average annual household income is only around $48,000, the nursing home costs is about 1 ½ times that. Those figures aren’t expected to slow down any time soon, with nursing home costs rising faster than the rate of inflation.
2008 Cost of Care Survery:
Assisted Living: A private one-bedroom unit in an assisted living facility in the U.S. has an average annual cost of $36,090. In Chicago, the average cost is $54,089 per year. In other parts of the state, the average cost is $35,472 per year.
Home Care: Nationally, the average hourly rate for a non-Medicare certified, state licensed home health aide is $19.18, a cost that translates to $43,884 per year for 44 hours per week of care. In Chicago, the average hourly rate is $20.42, or $46,721 per year for 44 hours per week of care. Elsewhere in Illinois, the average hourly rate is $18.65, or $42,671 per year for 44 hours per week of care.
Adult Day Health Care: First year research findings indicate the average annual cost for five days a week in an adult day health care facility is $15,236 nationally. The comparable cost in Chicago is $13,156, and $15,959 throughout the rest of the state.
What other bloggers are saying:
Moolanomy: Should My Parents Buy Long-Term Care Insurance?
Cash Money Life: Don’t Get Stuck in the Sandwich Generation
Securities offered through LPL Financial, Member FINRA/SIPC.
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Thanks for the blog post and presenting the rather scary, but real, stats on the costs of long term care. Besides the growing costs of long term health care, the age of those needing long term care is somewhat of an eye opener to many. 39% of those in need are between the ages of 18-64! So the notion that only those who are older need it, is not really the case. For anyone looking to know more about long term care insurance, and whether it’s even necessary, there is great free guide here – http://www.ltcconnects.com/resources/?page=consumer
Ian’s last blog post..New Long Term Care Insurance Bill?