Choosing a long-term care community isn't a decision to make lightly. You or your loved one may reside in a long-term care community for years, and you want to trust that you're safe, comfortable, and happy during that time.
Yet, most people choosing a long-term care facility are doing it for the first time and don't have the knowledge or experience to know what to look for in a skilled care or assisted living community. To help, LTC NEWS has put together this quick guide to everything you need to know about choosing long-term care for yourself or for a parent or other family member.
What does Long-Term Health Care Cost?
Long-term care costs are steadily rising in the U.S. The average cost of assisted living (base cost) is $49,555, while the average nursing home cost is between $92,190 to $103,627.
Care costs also vary depending on the type of care required and where you live. The LTC NEWS Cost of Care Calculator will help you see the costs based on location. Plus, you can find state-specific information about long-term care, funding options, and more - Cost of Care Calculator - Choose Your State | LTC News
Costs are rising rapidly and vary depending on where you live.
The Types of Long-Term Care Facilities
The level of care required has a significant impact on the cost of long-term health care. Nursing homes are the most expensive because they provide 24/7 custodial care and skilled services as needed.
On the other hand, assisted living facilities are designed for seniors who need help with daily tasks but require limited medical care. Assisted living costs vary widely based on location, amenities, and a resident's needs. Expect to pay more for memory care, continuing care retirement communities, and other specialized services.
What are the Best Ways to Fund Long-Term Health Care?
There are four primary ways to pay for long-term care:
- Long-Term Care Insurance
Some adults buy insurance to plan for the high cost of long-term health care. Annual premiums average around $3,000 for a 55-year-old couple. However, costs vary based on age, health, and other factors. Plus, premiums can vary over 100% between insurance companies. Hybrid policies combine life insurance or an annuity with long-term care benefits; however, they tend to be more expensive as they combine the death benefit and long-term care. However, some people like the idea of having a guaranteed benefit whether or not a person requires long-term care.
Using your own assets is an option for some people, primarily for very high-net-worth individuals with enough advance planning.
- Using Home Equity
Most people's biggest asset is their home, and even middle-class families can self-fund when they tap home equity by using a reverse mortgage or selling their home altogether. Using your home equity is an option since selling your home could pay for several years of long-term care with still money left over in some cases. The reverse mortgage can fund in-home by using your home's equity and eliminating the mortgage payment.
Remember, those with equity in their home can use a reverse mortgage to fund either traditional Long-Term Care Insurance or a single premium hybrid policy with a death benefit. However, if you need a facility, a reverse mortgage is ordinarily unavailable since most states require you to remain in the home.
Medicaid is designed specifically for those with little or no income and assets. Medicaid-funded long-term care is usually the only option for eligible seniors. While a home is a non-countable asset for seniors applying for Medicaid, the homes of Medicaid beneficiaries are subject to liens through the Medicaid Estate Recovery program.
What to Look for in a Long-Term Care Facility
Most people prefer to stay in their home when they need help with daily living activities or light supervision due to dementia - Finding Quality In-Home Care | LTC News. However, there are times care in a facility is more appropriate or required.
Affordability is important, but the price isn't all that matters when choosing a long-term care facility. It's also essential to make sure the community you choose is committed to residents' well-being.
The family must determine the appropriate type of facility. There is everything from independent living, often attached to an assisted living facility or nursing home. Then there are a variety of assisted living facilities, memory care facilities, and nursing homes available.
The other question is who will be paying for the care. Medicare will only pay for a very limited amount of skilled care in a nursing home or rehabilitation facility. Most long-term health care is custodial - meaning help with daily living activities or supervision due to memory loss. Medicare and traditional health insurance will not pay for that type of long-term care. Medicaid will only pay if you have little or no income and assets. Otherwise, the care will be self-funded unless you or your loved one owns Long-Term Care Insurance.
- Use Medicare's search tool to compare local nursing homes and find ratings.
- Learn the most important things to look for in a long-term care facility.
- Understand long-term care fee structures and the fine print of senior living resident agreements.
- A reluctance to discuss billing is a red flag and signifies that a community may not be the right fit. Finding a Quality Nursing Home | LTC News
Professionals Who Can Help
If you are going to use your equity in your home to pay for future or current care, a reverse mortgage will help you accomplish that goal. You can find a mortgage broker who understands reverse mortgages to assist you and your family.
You could sell your home and use proceeds to fund care. Connect with a real estate agent with a deep understanding of the local housing market. Your agent will be able to help you determine the best asking price and offer insight into making certain repairs or updates.
Working with a real estate expert can make all the difference as you navigate such a challenging process.
When it comes time to move, it's always a good idea to work with professional movers. You can find dependable moving companies by searching for "local movers near me" and review the ratings. Make sure a mover does an in-home inspection before you hire them.
Pre-planning always reduces the stress and anxiety otherwise placed on your family. For many families, Long-Term Care Insurance offers guaranteed tax-free benefits that will help pay for all types of long-term health care. However, LTC Insurance is medically underwritten, so obtaining coverage in your 40s or 50s makes the most sense and is the most affordable time to plan.
Use a qualified Long-Term Care Insurance specialist to help you navigate the many available options - Work With a Specialist | LTC News
There's a lot to consider when choosing long-term care. Avoid rushed decisions by starting the long-term care conversation before institutional living is imminent. When you have time to hand-pick a community for your loved one, you can take the next step, knowing you're making the best decision for everyone.
A family meeting with your parent and siblings is an excellent place to start once a parent starts to decline and help with daily activities is necessary - Mom or Dad Need Long-Term Health Care - Start with a Family Meeting | LTC News.
About the Author
Donna Erickson is a retired public educator. She created Fit Memory with a few friends as a way to promote wellness among senior citizens with the hopes it will help inspire others to make the most of their golden years.
Contributor since December 8th, 2021