The Cost of Long-Term Care
Whether provided in a nursing home, assisted living facility, or inside the home, long-term care (LTC) services offer daily assistance for people with chronic illness or disabilities. They help patients with various essential tasks, from eating, bathing, and dressing to housekeeping, grocery shopping, and even money management.
Most employer-sponsored private insurance plans don’t cover long-term care services, nor does Medicare. The reality is that around 7 out of every 10 seniors will need long-term care at some point during their lifetime. But if you start planning early, you can avoid mountains of medical bills and associated debt.
- Long-term care refers to services received from nursing homes, assisted living facilities, in-home care providers, and adult day care centers. These services help with eating, bathing, mobility, and other custodial tasks that patients can’t complete independently.
- Annual LTC costs in 2020 range from $93,075 to $105,850 for care in a nursing home, $53,768 for homemaker services, $54,912 for a home health aide, $51,600 for an assisted living facility, and $19,240 for adult day health care.
- Most medical and disability insurance policies, including Medicare, don’t cover long-term care, which is why you need a separate plan.
Long-term care services offer both medical and non-medical assistance.
The medical side can include:
- Using the toilet
- Transferring (moving short-range from one position to another, like from a bed to a chair)
- Eating and drinking
The non-medical side can include:
- Taking medications
- Money management
- Grocery shopping
- Pet care
The cost of care varies widely and may depend on the type of care you need, how long you need it for, and where you live. Costs may also depend on the time of the service provider’s shift; home health care services are often more expensive on evenings, weekends, and holidays.
According to data from the insurance firm Genworth Financial, the national average costs for long-term care in 2020 are as follows:
- Nursing homes: $255 per day or $7,756 per month for a semi-private room; $293 per day or $8,821 per month for a private room
- One-bedroom unit in an assisted living facility: $141 per day or $4,300 per month
- Home health aide: $150 per day ($24 hourly) or $4,576 per month
- Homemaker services: $147 per day ($23.50 hourly) or $4,481 per month
- Adult day health care centers: $74 per day or $1,603 per month
Standard health insurance plans do not offer long-term care coverage. This includes both employer-sponsored health insurance policies, as well as federal health care programs such as Medicare. While Original Medicare does not cover long-term care insurance, it may pay for 100 days of skilled nursing services or rehabilitative stay in a nursing home. Beyond that, Medicare beneficiaries must pay 100% of the cost of LTC services.
Medicaid, on the other hand, does cover some long-term care coverage for people who fit the low-income criteria necessary to qualify for the program. Medicaid is the largest public payer of LTC services nationwide. Federal programs through the Department of Veterans Affairs may pay for long-term care services under some circumstances.
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