Understanding the Cost of Long-Term Care

It seems everything is going up in price these days, and the cost of long-term care—whether offered in an assisted living community or provided in the home—is no different. There are many factors involved in the rising costs, and each is worth understanding as you navigate the decision process concerning your needs, or those of a loved one. But equally important is having a realistic look at what it costs to provide similar care at home.

Which is the better option in Beverly, Massachusetts? Once you look at the numbers, and consider what’s most important for you, the answer might surprise you.

Why is the cost of long-term care at home increasing?

Remaining at home might be the wish for many older adults, but it’s not necessarily a lower-cost alternative. In fact, care provided by home health aides is costlier than ever.

CNBC reports that the annual median cost for home health aides grew by 12.5% to $61,776, and homemaker services increased by 10.64% to $59,488 in 2021. There are many factors for these increases, most notably the fact that the senior population is growing at an unprecedented rate. In fact, the U.S. Department of Labor predicts the need for home health aides and caregivers will increase 35% in the next 10 years.

More demand, but fewer qualified caregivers. And not only has it become more difficult to recruit the right applicants for long-term care at home, retaining experienced personnel has also become more difficult.

Other factors behind the rise in the cost of long-term care at home are:

• Wage pressures
• Regulatory changes
• Sicker patients

But isn’t long-term at home care still less expensive?

Not necessarily. In fact, Genworth estimates that between 2019 and 2027, the total expenditure on long-term care at home in the U.S. is expected to increase by roughly 72% to $186.8 billion, outpacing the projected 52% growth in spending on nursing care and continuing care retirement communities during the same period.

And it’s not just paying for a home health aide. Taking on the responsibility of home care means either you must provide these services, or pay someone to do so (with some requiring 24-hour attention):

• Dressing/bathing/grooming assistance
• Medication management
• Help with getting food/preparing food/dining
• Housekeeping/laundry
• Transportation to physician appointments
• Keeping up with bills/paperwork
• Home maintenance
• Taking care of a pet

Home care calls for a very big commitment of time and attention, often more so than a family caregiver can give without sacrificing their own health and emotional stability. Not to mention the strain it can place on a family, as well as the guilt a loved one might feel realizing they need this level of assistance. Then there’s the possible costs of retrofitting a home to accommodate an aging resident (safety features in the bathroom, wider hallways, etc.) It’s not dollars and cents so much as it is quality of life for everyone involved.

The cost of long-term care

According to a 2021 Cost of Care survey by Genworth, a private room in a nursing home costs $297 per day, or $9,034 per month. Semi-private rooms run $260 per day or $7,098 per month. The average monthly cost of a private one-bedroom apartment in assisted living is $4,500.

Of course, there are many factors that affect these estimates: location, size of the community, amenities and services of the community, for-profit vs. non-profit, and more. What’s important to remember is that while some numbers might give you sticker shock, an assisted living community offers a lot more than just room and board.

For example:

• 24-hour staffing
• Assistance with activities of daily living
• Medication management
• Nutritious dining
• Transportation to physician appointments
• Activities and programs for healthy socializing
• Safety and security
• Maintenance and housekeeping included

Perhaps the most precious benefit of all: peace of mind.

It’s hard to put a price on the reassurance a family has knowing their loved one is surrounded by a caring staff who are available when needed, night or day, year-round. In addition, moving into an assisted living community for long-term care can include new opportunities for fitness and enhanced wellness, lifelong learning, socialization, pursuing hobbies and regaining a sense of purpose.

We welcome you to consider The Herrick House. As a non-profit assisted living community, we continuously reinvest in our staff, our activities, our dining and our building to ensure that our residents are living the highest possible quality of life. Our location on the upper campus of Beverly Hospital offers easy access to physician, outpatient and 24/7 hospital services. That’s just the beginning. We’d love to tell you more.

At The Herrick House, you’re in the company of friends, peers, and caring staff. Download our free Financial Planning for Retirement Living Guide to learn more about funding assisted living care, or contact us.