Cost of Care Survey: Nursing Homes, Assisted Living Facilities & Home Care Providers

Consumer Perception of Long Term Care Costs
Americans generally know long term care is expensive and costs are rising. In fact, 63% expect the cost of long term care to rise faster than inflation. Thirty-four percent (34%) of consumers believe nursing home care costs more than $75,000 a year, when the actual cost is around $70,000. Typically, those needing long term care would like to remain in their own homes, however, most people underestimate the cost of in-home health care. More than half (56%) of older adults believe home health care costs less than $20 an hour, when the estimated national cost this year is $25.32 per hour.

The Reality of Long Term Care
Half of people over 40 have a parent or other relative who needs or has needed home health care or long term care in a nursing home or assisted living facility. Two-thirds of Americans (65%) over age 40 say they have supported or are now providing financial, emotional or physical support to a parent or other relative.

Long Term Care Preparedness
Although survey respondents express concern over rising costs, only one-third (35%) have made any advance preparation for long-term care. Lower-income and minority respondents are even less likely to prepare for long-term care needs.

How Consumers Plan to Pay for Long Term Care
Of those stating they have made plans for long term care, one in four plan to use savings to pay for any needs that arise. However, census data shows that by the time the average senior citizen spends 18 months in a nursing home, they would wipe out their entire life savings, including their home. Average net worth of Americans over 65 years old is $108,000, including home (2000 Census data) Less than ten percent of people nationwide have purchased long term care insurance, but 18% of survey respondents report having coverage. Long term care insurance is commonly confused with standard health insurance or long term disability insurance. More than one in four older Americans is under the incorrect impression that Medicare covers long-term care. Generally, the Federal Medicare program does not cover long term care.

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