Nursing Homes May Bankrupt You. In-Home Care is Not Cheap. Better Have a Plan

Most long-term health care is delivered in-home. Like nursing homes, memory care facilities, and assisted living, the costs are expensive. Planning with an LTC policy is the easy solution.

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Nursing Homes May Bankrupt You. In-Home Care is  Not Cheap. Better Have a Plan
6 Min Read June 27th, 2015 Updated:March 8th, 2021
James Kelly

LTC News author focusing on long-term care and aging.

Longevity has become a big concern for retirement planning. The costs of long-term care services and supports will often drain savings and have a negative impact on income. For couples, this will have a dramatic effect on a couple's lifestyle, even if they have substantial savings. 

Not only are nursing homes expensive, but as a result of what we learned from the virus crisis, avoiding a nursing home is probably a good idea. Good nursing homes, assisted living facilities, and memory care facilities are very costly.  The cost of home health is also not cheap. Quality care providers offer outstanding care, but unless you have the resources or an advance plan, the costs will also drain assets and adversely impact income and lifestyle.

The cost of this care does vary depending on where you live. According to the LTC NEWS Cost of Care calculator, the national average of skilled care in a nursing home is around $103,000 a year. 

Most Extended Care Starts at Home

However, most long-term care is delivered in your own home or other facilities like adult day care centers, assisted living facilities, memory care centers, and traditional nursing homes. Since the chance of needing some type of care service in your lifetime is so high, addressing the financial costs and burdens of aging is essential.

But remember, long-term care is both a cash flow issue and a family issue. Many people don't want to place the future responsibility of either caregiving or managing their future care on their family. Often, without an advance plan, this falls on a daughter or daughter-in-law. They usually have their own careers and family responsibilities to be concerned with. Being a caregiver is an added stress. 

Don't Expect Health Insurance or Medicareto Pay for Long-Term Health Care

Health insurance, including Medicarefor those aged 65 and older (including supplements), pays only a small portion of skilled services. Most long-term care is custodial in nature and not covered at all by any insurance other than Long-Term Care Insurance. This is why so many experts suggest having a plan in place before your retirement.

The question remains, are you prepared for the high costs of long-term care and the impact it will have on those you love? 

Family Members or Spouses Are Not Best for Caregiving

Yes, paid care is expensive. If you think your children or your spouse will become caregivers think again. Caregiving is hard, and your children will have their own careers, families, and responsibilities. Plus, you are not the only one getting older! 

Yes, you and your spouse are aging, and your future older spouse will not be able to handle being a caregiver. However, by the time you need care, your children will also be older. This is another reason to think about planning ahead.

A recent article in Motley Fool suggests the cost of extended long-term health care has a significant impact on your future retirement. The costs could even to the point where you may end up spending down a majority of your assets, forcing you to access the Medicaid program.

 "There are many things to look forward to in the future, but there are plenty of things we worry about, too. Many people worry about their health and dread certain potential outcomes, such as becoming unable to care for themselves and perhaps ending up in a nursing home. That alone is an unpleasant thought, and nursing home costs can be another."

Motley Fool article written by Selena Maranjian

She mentions that nursing home stays are less today than in the past. This is not, however, due to fewer people needing extended care services. Today there are just more options than ever before on how to receive that care. More home care options are available in addition to adult daycare and assisted living.

The article suggests that the costs for Long-Term Care Insurance have been going up in recent years. However, premiums are affordable at the ages most people start looking into planning. For people in their mid-40's to age 65, you will find premiums very affordable, especially if you are married and in good health.

"Finally, remember that, when you start having trouble caring for yourself, there might be less expensive options than a nursing home, at least for a while. An assisted-living facility might do (Genworth cited a national median annual cost of $43,200 for that), while home health aides cost a national median of about $20 per hour. Twenty hours per week of that would approach $21,000.

It's worth spending some time now thinking about how you would pay for nursing home costs -- or other long-term care costs, for that matter. A little planning now might prevent panic or desperation later."

Selena Maranjian 

"When it comes to Long-Term Care, the vast majority of care is provided in the home."

Jesse Slome, director of the American Association for Long-Term Care Insurance (AALTCI), a leading consumer advocacy group

The rate for a home health aide averages $21 an hour according to the latest report published by the AALTCI.

"Just over half of all Long-Term Care insurance claims start with the policyholder receiving care at home."

"First, that's where most of us would prefer to be as opposed to a nursing home setting and the insurance policy benefits make it possible for people to get that needed care at home."

"People buying Long-Term Care insurance today need to understand that having insurance that pays some but not all of the cost is a prudent way to plan."

"It's also a way to make this protection very affordable, with a 55-year old paying around $100-to-$130 a month for protection."

Jesse Slome

Slome advocates the 'Good - Better - Best approach to Long-Term Care insurance planning.

The Association offers free access to a video explaining how to reduce the cost. The videos can be found at

Long-Term Care Insurance Offers an Affordable Way to Prepare Family and Finances

Affordable Long-Term Care Insurance gives you access and control. You will have your choice of quality care in the setting you desire without placing a burden and stress on your loved ones. 

Plus, policies protect your income and savings. Your family doesn't need to go into a crisis because of your future aging and health needs. You can safeguard your income and assets and ease family stress with an affordable Long-Term Care Insurance policy. 

The key is to plan before you retire when premiums are very affordable, and you still enjoy good health. Start your research by finding the current and future cost of extended care services where you live by using the LTC NEWS costs of care calculator. Click here and see the financial impact of long-term care. 

Always use an experienced Long-Term Care Insurance specialist. Most general insurance agents and financial planners are not qualified in this area. Be sure your specialist works with the major insurance companies, not just one or two. Also, be sure they have enough experience where they have processed claims. 

Find a trusted and experienced Long-Term Care Insurance specialist by clicking here

Don't ignore the future costs and burdens of aging. Keep control over your finances, and maintain your independence by planning now.

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About the Author

An LTC News author focusing on long-term care and aging.

LTC News Contributor James Kelly

James Kelly

Contributor since August 21st, 2017

Editor's Note

Many people realize the necessity of having a plan for long-term health care. Nonetheless, many have not yet done so. Some people think LTC Insurance is too expensive (it's not). Others assume it can be complicated (it can). Planning before you retire is crucial.

No matter if you need care due to an illness, accident, or cognitive decline, Long-Term Care Insurance gives you access to your choice of quality care, including in-home care. You will protect your income and assets and reduce family burden.

Use the many resources available on LTC NEWS to help you plan for the financial costs and burdens of aging. Remember, we will need care in the future due to an illness, accident, or just the impact of aging. Care costs are expensive, and the stress on the family is high. However, Long-Term Care Insurance is easy and affordable for most people.


These links will help you find valuable tools on LTC NEWS to help in your research:

Long-Term Care Insurance Guide 

Long-Term Care Insurance Tax Guide 

Frequently Asked Questions 

State Comparisons 

Insurance Company Comparisons 

It is always best to plan before your retirement, ideally in your 40s or 50s. Find a qualified and trusted specialist by clicking here. 

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