The average monthly cost for assisted living has risen 5%, which might drive some seniors to consider other, more economical options when it comes to long-term care, according to the 2012 American Association for Long-Term Care Insurance (AALTCI) Sourcebook.
Assisted living costs an average of $3,350, reports the association, but despite the increase, more people have been turning to assisted living or home healthcare options rather than nursing home care. Less than a third (31%) of newly opened long-term care insurance claims are for nursing home care, according to AALTCI data.
However, many seniors are realizing that long-term care insurance can allow beneficiaries the option of staying out of assisted living communities in favor of more economical, in-home care, according to Jesse Slome, executive director of AALTCI. While the monthly cost of assisted living facilities saw the 5% increase, from 2006 to 2011, home health care saw just under a 1% annualized increase, he says.
“People today want choice and control about where they are going to live as they age,” says Slome. “They want to be as independent as possible for as long as possible and the benefit of having long-term care insurance is that it provides the funds to permit just that.”
One million people resided in long-term care facilities in 2011, according to the association. The average age of seniors moving into assisted living communities is 84.6, and residents stay in facilities for an average of 22 months.
In addition to the increase in monthly costs, AALTCI also found a wide range in the monthly rates assisted living facilities charge. Monthly rates in Kansas City alone vary by more than $3,000, according to the sourcebook.
While prices will inevitably continue to rise, according to Slome, the aging generation will continue choosing the long-term care option that best matches their economic situation.
“Assisted living is a wonderful option for the people who can afford it,” he says. “But you have a large generation of Americans that have no plan for living a long life. Most people don’t have a plan, so they stumble along. Those who have a plan, they have many options available to them.
Written by Erin Hegarty