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Cost Of Long-Term Care Rising; Financial Planning Tested
An extensive survey done earlier this year by Genworth Financial found that the cost for nursing home care across most of Michigan was 13 percent higher in 2008 than it was in 2004, but less of a percentage hike than was recorded in Detroit and across the rest of the country over the same timeframe.
The cost for that type of care in the six-county metro Detroit region rose by 5 percent more over those five years to 18 percent. Nursing home care costs went up by 17 percent nationwide from 2004 to 2008.
The Genworth Financial study, called the Cost of Care Survey, gathered and analyzed costs at more than 10,000 nursing homes, assisted living facilities and home care service providers in all 50 states and the District of Columbia. The annual survey found that long-term care costs went up for the fifth consecutive year.
The 12-month price tag for a room in a private nursing home in the Detroit region is $79,027 this year — $73,481 in the rest of Michigan. The current average yearly national cost is $76,460, a figure that is 1.5 times the U.S. average annual household income of $48,201.
“Rising long-term care costs are creating significant financial planning challenges for millions of Americans and their families,” said Buck Stinson, president of the long-term care insurance division at Genworth Financial.
Other cost findings from the survey were:
- The average annual cost for a private one-bedroom unit in an assisted living facility in the U.S. this year is $36,090 — $37,408 in metro Detroit and $30,393 elsewhere in Michigan.
- The average annual cost for licensed home health care nationwide is $43,884 — $43,815 in metro Detroit and $41,664 in the rest of Michigan.
- The average annual cost for adult day health care is $15,236 nationally — $13,725 in the Detroit area and $12,814 in other parts of Michigan.
All long-term care costs in outstate Michigan are expected to rise by 80 percent from 2008 to 2020.
Genworth Financial commissioned CareScout to conduct the survey from December 2007 through February 2008. Genworth Financial is based in Richmond, Va., and is a global financial security firm listed in the Fortune 500.
The survey can be accessed at www.genworth.com/costofcare
The survey also found that the caregiver work force is dwindling and the industry is facing staff retention issues. At least 200,000 new care workers need to be recruited nationally each year to meet the future demands that 78 million baby boomers will place on the market.