The new Genworth numbers also provide yet more evidence that you need to save a good chunk of money for potential long-term care costs.
A recent nextavenue.org article, titled "Are You Set to Pay a $262,800 Nursing Home Bill?", found that price increases are rising substantially more than U.S. inflation overall. Inflation only increased 1.5% in 2013, and medical price inflation rose 1%, with hospital and related services up by 4.9%. A recent AP/NORC survey found that 58% of people underestimate the costs of a nursing home. Here are a few more fun facts:
- The median national cost of a room in an assisted living facility is now $42,000, up 1.45% from 2013.
- Hiring a home health aide for long-term care costs $20-an-hour or $45,188 annually (median rate), a one-year increase of 1.59%.
- It costs $43,472 a year (or $19 an hour) to employ someone to do homemaking services, which is up by a whopping 4.11% over 2013.
Why do these numbers matter?
The article states that if you live to 65, there’s a 70% chance you’ll need some form of long-term care services in the future. The number of Americans needing long-term care services and support is expected to explode from 12 million in 2010 to 27 million in 2050. The article was optimistic, however. Hopefully, as more people hear about annual long-term care bills of $42,000 to $86,700, they’ll start to take the hint and begin saving or buying a long-term care insurance policy. A 60-year-old couple who each buys $164,000 of protection through long-term care policies will pay an average of $3,840 a year for the insurance, according to the American Association for Long-Term Care Insurance. But don’t wait! Those premiums are much higher if you buy coverage in your late 60s or 70s (assuming you’re not turned down), the article warns.
These dollar figures are pretty shocking. Do your part to reduce the shock—for both yourself and loved ones—by looking into long-term healthcare planning. A seasoned elder law and estate planning attorney can advise you, answer your questions and help you prepare for this scenario. Make an appointment today.