The cost of long-term care is increasing in America.
Americans over the age of 65 can expect to require long-term care in their future.
According to the U.S. Government, at age 65, you have a 70% chance of spending time in long-term care going forward.
Because of this demand and the number of individuals in this demographic, costs for long-term care services have increased sharply.
Recent data shows total lifetime costs for long-term care often exceed $250,000 and can be substantially higher for some seniors.
Yikes!
With the need and costs not expected to change, Americans should plan for how to pay for their care.
Failure to use proactive financial strategies can leave seniors with depleted savings, debt, or subpar care.
Planning helps families protect their assets and manage costs effectively.
The shortage of professional caregivers is a key factor contributing to the rising costs of long-term care.
Similar to most economic costs, the most prominent factors are supply and demand.
Shortages of labor in caregiving fields have driven up wages for the workforce, as well as the costs of both residential care and in-home aides.
Another factor is inflation.
When the dollar has a lower value, the living facilities and their residents must pay more for food, rent, and medical supplies.
How much is the average cost for long-term care?
If a person has a private room in a nursing home, the average annual cost exceeds $100,000.
For assisted living, the annual costs range from $50,000 to $70,000 per year.
Hiring part-time support for in-home care can cost several thousand dollars each month.
These averages only account for the direct costs to long-term care providers.
Transportation, care coordination, home modifications, and prescription medications further increase the financial burden for loved ones.
People often fail to adequately prepare when they underestimate the care they will require or the costs of these services.
Many Americans mistakenly believe Medicare covers long-term care.
While Medicare does not typically cover long-term care expenses, Medicaid does.
Unlike Medicare, Medicaid requires people to meet strict asset and income limits to qualify.
Qualifying for Medicaid without having to deplete assets and leave spouses or dependents vulnerable requires advance planning with an elder law attorney.
Another option for preparing for long-term care expenses is acquiring a long-term care insurance policy.
These insurance policies must be purchased well in advance and can be costly.
A combination of careful budgeting and financial or legal planning will be necessary for most families.
While there can be some overlap in the work of elder law and estate planning attorneys with the creation of irrevocable trusts, general durable powers of attorney, and advance health care directives, elder law attorneys also provide long-term care planning documents and Medicaid planning services.
For example, we do not provide elder law services, but we are aware of excellent firms in our community that do.
Some families benefit from the focus on long-term care, while others find the estate planning and financial planning aspects satisfy their needs.
If you or a loved one has already faced a long-term care crisis, it is too late to prepare for managing the costs of the required services.
Those who make plans will find they have more flexibility, funds, and opportunities available for preserving both dignity and independence.
Families without a plan will be forced to make quick decisions.
These often result in expensive mistakes and conflict among relatives.
An experienced elder law attorney or estate planning attorney can help you address these needs and concerns strategically and effectively.
The costs of long-term care have been rising and are not expected to go down.
The average lifetime costs of the services now exceed $250,000 per senior.
Because Medicare does not cover long-term care expenses, families will have to pay out-of-pocket if they did not prepare for the costs through Medicaid planning or long-term care insurance.
Elder law attorneys can help families navigate and utilize various strategies to promote asset protection and provide better care for their loved ones.
Planning early is essential to reducing stress for loved ones and meeting the needs of seniors.
This post is for informational purposes only and does not provide legal advice. You should contact an attorney for advice concerning any particular issue or problem. Nothing herein creates an attorney-client relationship between Harvest Law KC and the reader.
Reference: CNBC (May 17, 2025) "Long-term care costs can be a ‘huge problem,’ experts say. Here’s why"
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