As more Americans live longer into their old age, our country will begin facing a caregiving crisis that will reverberate through every corner of the economy. Two new reports reveal the staggering cost of this aging crisis for Americans and their families.
Nursing Home Prices Surge and Show No Sign of Slowing
Many older Americans assume Medicare will be available to cover their medical costs as they age. Unfortunately, it’s not as simple as that. Medicare is a fee-based insurance service but doesn’t cover so-called custodial care in nursing homes or assisted living facilities. As a result, many Americans must pay for the cost of custodial care themselves. However, a new study from Georgetown University reveals that the cost of nursing home care is rising rapidly across the country. The “study found nursing home price rises over the period measured generally outpaced increases in overall medical care (20.2%) and consumer prices (11.7%). For example, in California from 2002 to 2011, the median out-of-pocket cost for nursing home care increased 56.7%.”
Demand from a huge generation of Baby Boomers — now aging into retirement — is fueling this increase, as is a tightening labor market. The annual costs of nursing home care paints an even starker picture. “Looking at the issue from an annual perspective, the median cost in the U.S. for a private room in a nursing home was $100,375. Oklahoma provided the cheapest annual median cost, at $63,510, while Alaska was the most expensive at $330,873, Genworth data showed.”
Very few older Americans can absorb those out-of-pocket costs. In the past, some have turned to long-term care insurance to pay for nursing home care when the time came. But in recent years, the cost of long-term care insurance has skyrocketed, making it all but unaffordable for many Americans. As a result, seniors who need custodial care and can’t afford the associated out-of-pocket costs, must spend down their life savings in order to qualify for Medicaid.
The report also reveals that without widespread, systemic changes to our healthcare system, the problem will likely only get worse for members of Generation X, millennials, and Generation Z.
Wages Lost to Unpaid Family Caregiving Projected to Double
The high cost of assisted living often forces family members to step in and provide unpaid care for their needy older relatives. But this comes at a heavy cost as well. According to Physician’s Weekly, “the current economic cost of unpaid family care is about $67 billion and includes reduced work hours and foregone earnings for Americans 20 to 64 years old who take time off from their jobs to help a loved one manage serious medical issues.”
Because the Baby Boomer generation was so large, and subsequent generations have been much smaller, there will be fewer potential caregivers per disabled adult in the coming years. To compound the problem, those family members who will be available to provide care will be more likely to be more educated and have a higher lifetime earning potential. As a result, the projected “cost of lost wages for unpaid family caregiving is on track to more than double, to reach $147 billion by 2050.”
A New Plan for Aging
These studies underscore the importance of families planning for aging. While there’s no single magic bullet to solve this complicated issue, a combination of strategies can provide relief. To start, seniors must save aggressively to help defray their costs of aging. Simply relying on government programs like social security and medicare won’t suffice, especially as those programs enter periods of political uncertainty. Next, seniors can plan to age in place. Using this strategy, seniors create a plan to live in their own homes for as long as possible. Aging in place helps delay entry into expensive assisted living and provides seniors with a higher overall quality of life.
Adult children should also begin planning how they’ll care for their parents. The cost of providing unpaid care is so high, that it would be unwise for many family members to quit their jobs to provide full time care — at least early on. In these instances, in-home care services can help pick up the slack and help older people live independently in their own homes for longer. This non-medical care can be very cost-effective and fill a much-needed gap in the overall spectrum of care. As a result, it should be included prominently in your overall plan for aging.
One thing’s for certain, adults reaching retirement age cannot ignore these issues. They must be met head-on and planned for accordingly.
About Generations Home Care
Generations Home Care personalized in-home care and support services help those recovering from illness, injury or surgery, living with a chronic disease, or dealing with the natural process of aging. We help people live a fuller, healthier and independent life.
We offer levels of care ranging from companionship, to respite for the primary family caregiver, to homemaking services, to assistance with activities of daily living, to Alzheimer’s and dementia care. Generations Home Care takes a holistic approach and emphasize a consistent, client-centered plan of care.
Our Specialty Services Include:
- Rehab or hospital-to-home programs for safe discharge.
- Short-term post-operative care during recovery periods.
- Non-medical life management services for people with chronic conditions.
- Veteran’s connection to care program.
- Live-in services and couples care.
If you’d like to learn more about how we can help you, contact us today at 602-595-HOME (4663) or by filling out the contact form on our website.