Bloomberg Businessweek is reporting that the average cost for assisted living rose 5.6 percent to $41,724 this year, compared with a 5.2 percent increase last year.
The report comes from data contained in a report by MetLife’s Mature Market Institute released this week. That report found the cost for a private nursing-home room increased 4.4 percent to $87,235 a year and adult day services climbed 4.5 percent to $70 a day. Home health-aide service was unchanged at about $21 per day.
Of particular concern is that the report finds that this year’s increases are greater than previous years. A MetLife representative noted that, “the state of the economy, combined with rising health-care and energy costs, are having a significant impact on long-term care rates… Long-term care rates continue to outpace the medical inflation rate.”
Federal Government options for supporting the costs associated with long-term are limited. The Obama Administration recently decided not to move forward with a public long-term care financing option called the Class Act. Medicare covers only short-term nursing and home health services.
“This is why the employer is central in the long-term care equation,” noted Em-Power Services President Doug Ross. “Without long-term care insurance, future retirees are going to face a financial crisis where they spend all of their savings and retirement to pay for long-term care.”
An employer that offers group long-term care insurance as a benefit can help employees protect their savings and retirement. It’s estimated that one of two people age 65 and older will require some form of long-term care. The average length is three years, and costs can exceed $250,000.
Many states offer additional tax deductions for employers who offer long-term care insurance as a benefit.
Tags: Financial planning, group long term care insurance, Home health care, Long-term care planning strategies, LTCI, Nursing home insurance, Paying for nursing homes | Filed under: Retirement, Uncategorized