15 Most Expensive States for Long-Term Care: 2017
Are you reaching retirement? Then, perhaps, you've already looked into the affordability of long-term care, and - well - it's not as affordable as you thought. If you're looking to get the most out of your retirement budget, then you may want to stray away from these 15 most expensive states for long-term care, as of 2017.
This article is brought to you by Think Advisor, and it was written by Marlene Y. Satter. You can read the full article here.
Genworth’s annual study on the cost of care nationwide, which includes home care, assisted living facilities, etc., is not reassuring
The price of long-term care insurance is high—for everyone involved. Not just the patient but also the caregivers pay in more than money to make sure that the person in need of care is given the best care they can manage.
In this year’s version of Genworth Financial’s annual study on the cost of care nationwide—not just in nursing homes, which are less and less on the forefront, but also care provided at home, adult day care and assisted living facilities—the news is not reassuring. Costs have risen steadily, with those for licensed homemakers—those who provide what the study calls “hands-on personal care” for patients still in their homes—rising the fastest, increasing 6.17% just since last year.
And of course since people would prefer to stay in their homes, that’s going to hit a lot of people hard.
Less-skilled “homemaker care,” such as cooking, cleaning and running errands (not included in the breakdown that follows) has risen pretty quickly as well, increasing by 4.75% since last year. But both versions of homemaker assistance are at the low end on the price scale, coming in at $21 for homemaker care and $22 for licensed homemaker care. The big bucks are elsewhere.
They may not have risen as quickly percentage-wise as the two already mentioned, but adult day care increased by 2.94% since last year to a national median rate of $70 per day. Assisted living facilities now average a median monthly rate of $3,750, an increase of 3.36% from last year, while nursing homes, at an increase of 5.50% for a private room, now run a median daily rate of $267. No matter how you look at it, that’s a lot of money.
And caregivers often sacrifice their own financial well-being to care for their family members, forking over an average of $10,000 out of their own pockets for expenses that range from household expenses, personal items, or transportation services to payment of informal caregivers or LTC facilities.
A whopping 62% are paying for these expenses out of their own retirement funds; 45% have seen those costs cut their basic quality of living; and 38% have cut the amount they devote to savings and retirement to meet the costs of care.
And another sad side effect of all this stress is that 27% say it’s had a negative impact on their relationship with the person they’re caring for.
The penalty for all this devotion is that absences, reduced hours and chronic tardiness can end up cutting a caregiver’s pay. About a half of caregivers estimate that they lost approximately a third of their income.
Check out the 15 most expensive states for LTC.
15. Maryland
Average Annual LTC Cost: $60,305
- Adult day care: $2,150
- Licensed home care: $52,281
- Assisted living: $49,800
- Nursing home (private room): $118,990
14. Rhode Island
Average Annual LTC Cost: $60,789
- Adult day care: $19,500
- Licensed home care: $57,772
- Assisted living: $61,860
- Nursing home (private room): $104,025
13. California
Average Annual LTC Cost: $61,239
- Adult day care: $20,020
- Licensed home care: $57,200
- Assisted living: $51,300
- Nursing home (private room): $116,435
12. Washington
Average Annual LTC Cost: $61,704
- Adult day care: $16,900
- Licensed home care: $60,632
- Assisted living: $55,920
- Nursing home (private room): $113,362
11. Vermont
Average Annual LTC Cost: $63,139
- Adult day care: $34,320
- Licensed home care: $57,200
- Assisted living: $49,527
- Nursing home (private room): $111,508
10. North Dakota
Average Annual LTC Cost: $64,010
- Adult day care: $25,480
- Licensed home care: $63,972
- Assisted living: $36,219
- Nursing home (private room): $130,367
9. Maine
Average Annual LTC Cost: $64,423
- Adult day care: $28,080
- Licensed home care: $53,768
- Assisted living: $58,680
- Nursing home (private room): $117,165
8. New York
Average Annual LTC Cost: $65,852
- Adult day care: $20,800
- Licensed home care: $54,340
- Assisted living: $47,850
- Nursing home (private room): $140,416
7. New Hampshire
Average Annual LTC Cost: $66,044
- Adult day care: $18,720
- Licensed home care: $60,357
- Assisted living: $58,260
- Nursing home (private room): $126,838
6. Delaware
Average Annual LTC Cost: $68,472
- Adult day care: $18,850
- Licensed home care: $50,908
- Assisted living: $72,180
- Nursing home (private room): $131,948
5. New Jersey
Average Annual LTC Cost: $68,833
- Adult day care: $23,400
- Licensed home care: $52,624
- Assisted living: $69,732
- Nursing home (private room): $129,575
4. Hawaii
Average Annual LTC Cost: $71,820
- Adult day care: $18,200
- Licensed home care: $59,488
- Assisted living: $51,000
- Nursing home (private room): $158,593
3. Connecticut
Average Annual LTC Cost: $72,671
- Adult day care: $20,800
- Licensed home care: $52,624
- Assisted living: $55,200
- Nursing home (private room): $162,060
2. Massachusetts
Average Annual LTC Cost: $73,307
- Adult day care: $16,900
- Licensed home care: $59,488
- Assisted living: $67,188
- Nursing home (private room): $149,650
1. Alaska
Average Annual LTC Cost: $117,800
- Adult day care: $43,709
- Licensed home care: $63,492
- Assisted living: $72,000
- Nursing home (private room): $292,000
You can read the full article here.
Source:
Satter M. (2 October 2017). "15 Most Expensive States for Long-Term Care: 2017" [Web Blog Post]. Retrieved from address https://www.thinkadvisor.com/2017/10/02/15-most-expensive-states-for-long-term-care-2017
Younger buyers buying asset-based LTC
By Marli D. Riggs
The sale of asset-based long-term care insurance protection continues to grow significantly, reveals research by the American Association for Long-Term Care Insurance.
More than half (53%) of male LTC buyers were under age 65, up from 48% in a prior year’s study, while women buyers under age 65 also increased to 50%, up from 44%, according to data gathered from insurers.
Meanwhile, premiums increased nearly 20% and the number of covered lives increased 13.5%.
"We expect the sale of asset-based or linked LTC products will continue to grow as they offer some highly attractive benefits to a category of buyers looking to protect their retirement savings," says Jesse Slome, AALTCI's director. "The growth of sales will only continue as more large players enter the marketplace.”
In 2011 the study finds that the initial single premium face amount of policies purchased was $100,000 or greater for 73% of new policies. Meanwhile, 96% of new life and LTC policies issued did not include a benefit increase option that bumped up available benefits to keep pace with inflationary growth of costs. Additionally the study of traditional individual LTC insurance policy sales finds that in 2011 some 96% included a growth option.
“At a time when long-term care is increasingly top of mind, these life insurance-based solutions avoid the ‘use it or lose it’ risk associated with traditional long term care insurance,” says Chris Coudret, vice president of OneAmerica. “In most cases, people make a single payment, effectively removing the risk of future premium increases.”
