Genworth's recent 2023 Cost of Care Survey[i] shows that the cost of long-term care in the United States is going up. The rising cost of long-term care in a nursing home can be very damaging financially. According to the Genworth survey, the yearly median cost for nursing home care in the Philadelphia area is $161,330 for a semi-private room and $171,550 for a private room. The cost of a semi-private room has gone up by 3% since 2022, while the cost of a private room has increased by 7% since 2022.
Genworth's survey revealed that the biggest increase in the cost of care was for in-home care. In-home care involves hiring caregivers to help in a person's private residence, allowing them to stay in their home instead of moving to a facility. The national monthly median costs for this type of care have seen a significant increase in the past year. In 2023, the monthly costs were $5,720 for homemaker services and $6,292 for a home health aide. These figures represent price increases of 7% and 10% compared to 2022.
The survey data indicates that the rising costs of long-term care are due to inflation and the ongoing shortage of long-term care professionals. Understanding the potential cost of long-term care is important, but planning for it is even more crucial. Below are three ways to finance long-term care:
(1) Privately through savings. This option involves using saved funds to cover long-term care needs without relying on Medicaid.
(2) Long-term care insurance. This type of insurance is meant to cover services and support, such as personal and custodial care in different settings, including the home or a facility. Not everyone qualifies for long-term care insurance, but it's a good option for many and should be considered. It's important to consult with a financial advisor to explore long-term care insurance options.
(3) Qualifying for Medicaid. Medicaid can help with the costs of long-term care. It's a program based on financial need, with income and asset eligibility limits. Navigating the complex federal and state eligibility rules, especially for married couples, when applying for Medicaid can be overwhelming. Therefore, it's important to seek guidance from a Pennsylvania licensed Elder Law Attorney.
The first step in planning for the cost of long-term care is to seek advice from professionals who can help position your assets effectively, explore long-term care insurance options, and understand how to qualify for Medicaid. It's recommended to consult with a qualified elder law attorney and a financial advisor for guidance on strategies to plan for long-term care.
The legal guidance in this column is general, seek advice from your lawyer for guidance that fits your specific situation.
Rebecca A. Hobbs, Esquire is authorized to practice law in the Commonwealth of Pennsylvania and is certified as an Elder Law Attorney by the National Elder Law Foundation under the authorization of the Pennsylvania Supreme Court. She is a principal at the law firm of O’Donnell, Weiss & Mattei, P.C., located at 41 High Street, Pottstown, and 347 Bridge Street, Phoenixville, reachable at 610-323-2800 and www. owmlaw.com. You can contact Ms. Hobbs at [email protected]
