Cost of Long-Term Care Requires Additional Financial Planning
January 19, 2012 (PLANSPONSOR.com) – High costs of home healthcare, assisted living and nursing home care underscore the critical need to address long-term care as part of financial planning security.
According to Northwestern Mutual’s “Cost of Long-Term Care Study,” while the costs vary widely based on location and type of care, the study shows that the national average daily rate for a single occupancy, private nursing home room is $246.06 per day, or almost $90,000 for one year of care. According to the U.S. Department of Health & Human Services, the average length of stay in a nursing home is 2.4 years, which equates to more than $215,000 in care alone.
Other highlights from the study include:
• The National average monthly rate for a private, single occupancy room in an assisted living facility in the U.S. is $3,372.41 per month. The national average monthly rate for a shared room in an assisted living facility is $2,592.40 per month.
• The national average hourly rate for home health aides provided by a certified home healthcare agency is $20.65 per hour. The national average hourly rate for home health aides provided by a non-certified home healthcare agency is $23.98 per hour.
• The national average for the monthly rate for a private, single occupancy room in an assisted living facility is $3,372.41 per month. Comparatively, in Washington, D.C., Virginia and Maryland the cost for this same care is just over $6,600 per month and in Milwaukee, Wisconsin, an individual would pay just $1,200 per month.
“While costs vary greatly from region to region the need for long-term care planning does not,” said Steve Sperka, Northwestern Mutual vice president of long-term care. “The data is sobering, and doesn’t even include the added expenses of medical equipment, transportation, drugs and other hidden costs. Relative to other financial commitments in retirement, long-term care costs are disproportionately high and people need to think ahead to lessen the financial and emotional impact.”
The “Cost of Long-Term Care Study” was conducted by the Long Term Care Group, Inc. from August-November 2011, on behalf of Northwestern Long Term Insurance Company of nearly 4,400 assisted living facilities, nursing homes and home healthcare providers in specific regions of the U.S.