This Retirement Expense Is Rising Fast — Have You Planned for It?

Worried senior couple
Photo by wavebreakmedia / Shutterstock.com

Long-term care is expensive — and it’s growing even more costly.

The annual median cost of long-term care services increased by an average of 4.5 percent from 2016 to 2017, according to Genworth Financial’s 2017 Cost of Care Survey. That rate outpaces inflation.

Long-term care offers help with everyday tasks such as eating, bathing and dressing. Among people ages 65 and older, 70 percent eventually are expected to need some type of long-term care, according to Genworth, an insurance company. Standard health insurance policies do not cover the cost of long-term care.

Genworth found that the specific long-term care services that increased most in cost over the past year are:

  1. Home health aide services — up 6.17 percent to $21.50 an hour
  2. Private room nursing home care — up 5.5 percent to $267 a day
  3. Homemaker services (such as cooking, cleaning and running errands) — up 4.75 percent to $21 an hour
  4. Semi-private room nursing home care — up 4.44 percent to $235 a day
  5. Assisted-living facilities — up 3.36 percent to $123 a day

Long-term care costs can also vary considerably by state. For that reason, it’s important that retirees ask critical questions about long-term costs before moving.

For example, the median annual cost of home health aide services is $49,192 nationally. But the median cost can be much higher within a state. This cost is highest in:

  1. North Dakota: $63,972
  2. Alaska: $63,492
  3. Minnesota and Wyoming: $61,776

The median annual cost of a private room at a nursing home is $97,455 nationally but significantly higher in some states. It’s highest in:

  1. Alaska: $292,000
  2. Connecticut: $162,060
  3. Hawaii: $158,593

You can learn more about long-term care costs in your state by using Genworth’s cost comparison tool.

Paying for long-term care

Clearly, the cost of long-term care can exceed the budgets of even middle-class Americans.

Medicaid generally covers the costs of long-term care in nursing homes and at home, according to the federal government website LongTermCare.gov. But not everyone is eligible for Medicaid. It’s a joint federal and state health insurance program for folks with low income or with disabilities.

Medicare, the federally subsidized health insurance program for seniors, generally does not cover long-term care. Under certain circumstances following a hospitalization, Medicare will help pay for a skilled nursing facility, hospice care or home health care — but only for up to 100 days.

This leaves long-term care insurance as perhaps the most affordable solution for many people. Money Talks News founder Stacy Johnson details the pros and cons of it in “Ask Stacy: Should I Buy Long-Term Care Insurance?

Just note that long-term care insurance is a purchase best made by sometime in your 50s, as we explain in “Retirement Is Coming — Make These Money Moves in Your 50s.”

How do you feel about the rising cost of long-term care? Sound off below or on our Facebook page.

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

Read Next
5 Reasons You Should Not Delay Retirement
5 Reasons You Should Not Delay Retirement

Could you be waiting too long to quit working?

10 Mistakes That Cost You Money at Warehouse Stores
10 Mistakes That Cost You Money at Warehouse Stores

Wholesale clubs might have great deals, but these mistakes will cost you.

Secret Ways to Save on Netflix
Secret Ways to Save on Netflix

These little-known savings tactics can help whittle down what you pay for your streaming video subscription — every month.

8 Things You Should Replace to Improve Your Life Today
8 Things You Should Replace to Improve Your Life Today

Being frugal isn’t smart if you put off replacing these items.

Why Half of Retirees Now Owe Taxes on Social Security
Why Half of Retirees Now Owe Taxes on Social Security

Growing numbers of seniors are paying taxes on their Social Security benefits, but you might be able to avoid this fate.

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Most Popular
7 Kirkland Signature Items to Avoid at Costco
7 Kirkland Signature Items to Avoid at Costco

Even if it seems you save a bundle buying Costco’s Kirkland Signature brand products, they may not be the bargain they appear to be.

How to Buy Gas At Costco Without a Membership
How to Buy Gas At Costco Without a Membership

The warehouse club often has some of the cheapest gas in town. Here’s how you can get it as a nonmember.

10 Things to Stop Buying If You Want a Clutter-Free Home
10 Things to Stop Buying If You Want a Clutter-Free Home

If you like to keep things simple, avoid these purchases.

If You Find This Thrift Shopping, Buy It
If You Find This Thrift Shopping, Buy It

Vacuums from this brand can last a half-century, if not longer — and they’re hot on the resale market.

A Simple Way to Silence Robocalls Today
A Simple Way to Silence Robocalls Today

A few steps can keep your phone from ringing when a spammer calls.

This Company Makes the Best Tires in America
This Company Makes the Best Tires in America

Driver satisfaction with tires is at an all-time high, but one brand stands out.

This Health Issue Can Hint at Dementia Years in Advance
This Health Issue Can Hint at Dementia Years in Advance

One type of pain is especially associated with cognitive decline.

Can I Switch to Spousal Social Security Benefits When My Ex Dies?
Can I Switch to Spousal Social Security Benefits When My Ex Dies?

Knowing when to claim can help you maximize benefits.

36 Things That Will Be Obsolete Soon
36 Things That Will Be Obsolete Soon

The writing is on the wall for dozens of things we have grown up with.

Medicare Will Not Cover These 6 Medical Costs
Medicare Will Not Cover These 6 Medical Costs

Don’t let these health care expenses catch you off guard in retirement.

8 Things You Should Always Buy on Amazon
8 Things You Should Always Buy on Amazon

The giant retailer shines when it comes to these things, from basics to hard-to-find specialty goods.

8 Federal Income Tax Breaks for Homeowners
8 Federal Income Tax Breaks for Homeowners

Some of these deductions and credits are available to a wide swath of homeowners.

5 Ways to Get Amazon Prime for Free
5 Ways to Get Amazon Prime for Free

Hesitant to drop $119 a year on an Amazon Prime membership? Here’s how to get it for free.

5 Ways to Fill Your Pantry With Free Food
5 Ways to Fill Your Pantry With Free Food

Anyone can take advantage of these resources.

3 Ways to Get Microsoft Office for Free
3 Ways to Get Microsoft Office for Free

With a little ingenuity, you can cut Office costs to zero.

10 Types of Retirement Income That Are Not Taxable
10 Types of Retirement Income That Are Not Taxable

There are lots of things Uncle Sam can’t touch — so long as you play by the rules.

6 Reasons You Should Stop Hiding Cash at Home
6 Reasons You Should Stop Hiding Cash at Home

Stashing money around the house is anything but harmless.

5 States With the Worst Health Care for Retirees
5 States With the Worst Health Care for Retirees

All of these states are located in the same region of the nation.

5 Products You Should Never Buy Generic
5 Products You Should Never Buy Generic

Sometimes the brand-name version is clearly superior.

View More Articles

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Add a Comment

Our Policy: We welcome relevant and respectful comments in order to foster healthy and informative discussions. All other comments may be removed. Comments with links are automatically held for moderation.