I’ve had long-term care on the brain for the past several years thanks to my grandmother, Carol. Prior to her passing in June of this year at age 98, Carol lived in the memory care unit of an assisted-living facility for three and a half years. In the 8 years before that, my parents cared for her in their home.
As life expectancies increase due to improved health care and technology, my grandmother’s story has become a familiar one. In her case, she was fortunate enough to have the resources to pay for her care out-of-pocket. But, if my parent’s hadn’t shouldered the burden of caring for her themselves for so many years, her money might not have lasted as long as it did.
Every year the insurance company Genworth releases a cost of care survey that spells out how much it costs to pay for long-term care in specific locales across the country. They’ve even compiled the results into a neat interactive map on their website that allows you to compare the cost of care in multiple locations. (For those of you aspiring to be the life of holiday parties, it’s also available as an iPhone app!)
For our immediate area in NC, the 2012 costs for a semi-private room in a nursing home ranged from $147 to $209 per day in the Raleigh/Cary area and $114 to $264 per day in the Durham/Chapel Hill area. That’s somewhere in the neighborhood of $70,000 per year of care. Given that the average stay in a nursing home is about 3 years that adds up to a pretty significant chunk of change!
To make matters worse, the cost of care continues to rise. Per Genworth’s survey, the compound annual growth rate for a semi-private room in the Durham/Chapel Hill area has been 5% for 2007-2012. For the Raleigh/Cary area, the rate of increase over the same time period has been 3%.
With a shrinking pool of insurers continuing to even offer long-term care insurance and premiums on the rise, the decision of whether or not to purchase coverage can be difficult. And, even when you’re confident the answer is yes, you’re still faced with a confusing array of bells and whistles as you nail down your policy’s specifics. Fortunately, as financial planners in Chapel Hill, these are decisions we’ve guided clients through many times in the past and will continue to guide clients through in the future. So, if you’re like me, and have long-term care on the brain, please give us a call and we’ll get the conversation started.