Over the past decade, the subject of long-term care has garnered an increased amount of interest in the news, the public, and in the insurance industry. Considering the potentially staggering costs associated with aging and healthcare, creating a strategy for meeting the financial burden is imperative.
The Stats: According to the 2012 MetLife Market Survey of Nursing Home, Assisted Living, Adult Day Services, and Home Care Costs:
- The national average daily rate for a private room in a nursing home is $248, while a semi-private room is $222, up from $239 and $214 respectively in 2011.
- The national average monthly base rate in an assisted living community rose from $3,477 in 2011 to $3,550 in 2012.
- The national average daily rate for adult day services was $70 per day in 2012.(1)
To learn more about the costs of care in your state, visit the government website dedicated to long-term care information, www.longtermcare.gov.
Points to Consider: Planning for long-term care costs is about more than buying insurance. Each individual’s plan will differ according to their circumstances, resources, and preferences. Consider the following factors when creating a plan for meeting care needs:
- Who will provide care? Are family members able and willing to help care for aging parents?
- Where will care be received? If care is to be provided in the home, the structure may need to be remodeled for mobility. If a facility is considered, is it close enough for loved ones to help manage the care received by family members and is it capable of providing the type of care needed?
- How will costs of care be met?
Who Pays for Long Term Care: In planning for the costs of long-term care, consumers must understand which public programs are available to help and which costs will be the responsibility of the care recipient. According to longtermcare.gov, “a number of public programs, including Medicare and Medicaid, may help pay for some long-term care services under certain circumstances. However, each program has specific rules about what services are covered, how long you can receive benefits, whether or not you qualify for benefits, and how much you have to pay in out-of-pocket costs.” Usually, costs are met through a variety of sources, including public programs such as Medicare and Medicaid, private out-of-pocket payment by the individuals needing care and their family, or long-term insurance programs. In addition, a large portion of care needs are met in the home by unpaid family members and friends. For detailed historical information on how costs are paid, the Scan Foundation offers a helpful report at www.thescanfoundation.org.
As with many financial topics, starting the planning process as early as possible is the key to creating a plan that helps you or your loved ones receive the care needed. All Wisdom Wealth Strategies CERTIFIED FINANCIAL PLANNER™ practitioners are licensed to provide long-term care solutions and planning. We will help you design a custom plan for yourself or for aging parents that considers your resources, your preferences, and your beliefs. We welcome your questions.