LTC Costs Are On The Rise – Are Your Clients Protected?Julie Brooks
Over the years, we have been able to recognize and identify trends across the long term care market. While the cost of care among all providers has increased, the cost of facility based care has grown at a much greater rate than home care.
While your clients have more choices than ever before, it is vital to be aware of the associated costs in order to build a better asset protection plan.
If you live to 65, there is a 70% chance you will need some form of long term care services, so creating a sound financial plan for managing future costs is very important.
What are the costs?
The majority of claims are paid out for home care or for an assisted living facility, which typically costs much less than a nursing home.
The national median rate for a home health care aide is $20 per hour, with the annual five year growth being only 1.32%. Assisted Living Facilities have the highest annual five year growth rate of 4.29%, with the national median rate at $3,500 per month. A private room in a nursing home is not far behind with an annual five year growth rate of 4.19%, and the national median rate will set you back $240 per day.
As these costs continue to rise, your clients’ assets are at greater risk. Considering the average three year claim, in 25 years, figuring on a 3% inflation rate, the average claim will reach $840,000 for a private room in a nursing home. Are your clients prepared for that expense?