Insurance companies are keeping a close eye on the costs of long term care and a new study from Northwestern Mutual shows that assisted living continues to cost half as much as nursing home care. The study outlines long-term care costs by state, with data on nursing home daily rates, assisted living monthly rates, and home health care hourly rates. A separate survey by the company found that only 17 percent of Americans can provide an estimate of long-term care costs within 20 percent of their state’s average. Some of the findings include:
- Assisted living costs are highest in the East, where six states and Washington DC have average costs above $4,000/month. This compares to North Dakota – the least expensive state in terms of assisted living – with average costs of $1,901/month.
- Nursing home costs in Alaska are the highest at $538/day on average, which is $186 more a day than the next most expensive – Connecticut – at $352/day. Louisiana is the least expensive at $127/day.
- Residents of Missouri and Montana on average spend $19/hour for home health care, whereas West Virginians have average costs of $60/hour. Assuming an 8-hour day, five days a week, this amounts to an additional $328/day, or more than $85,600/year in West Virginia versus Missouri or Montana.
“People are living longer and health care costs continue to rise, making long-term care an increasingly important risk to address," said Steve Sperka, Northwestern Mutual vice president – long-term care. “It will take greater financial resources for residents of some states to protect their assets and lifestyle through retirement than others. Understanding the reality of long-term care costs in your area – and the potential impact to your financial security – is a critical step in developing a sound financial plan that won’t be derailed by a lack of awareness about long-term care risk.”
For the full survey, visit Northwestern Mutual 2010 Cost of Long-Term Care study