While real estate companies like Redfin and Zillow compile local real estate listings and prices for homebuyers, a similar search function is lacking for seniors and their families seeking assisted living options, creating a disparity—and sticker shock—between the price they expect to pay versus its actual cost, according to research conducted by A Place for Mom.
In their survey of more than 40,000 families, the assisted living referral service found that more than 40% spend more than the higher end of their anticipated assisted living budget range. Families they surveyed estimated the median midpoint of monthly assisted living costs at just under $3,500; yet, the actual median monthly cost they end up paying is just over $3,800, according to the company.
Further, the company found that 74% of families who had smaller monthly budgets (between $1,500 to $1,999) spend, on average, $915 more than the higher end of their budget for senior care.
Seniors with smaller budgets are “simply uninformed” about the actual costs of assisted living options and can actually foot the bill for more than they estimate, writes senior living researcher and data scientist Ben Hanowell in his analysis.
“Others truly have limited budgets, but aren’t poor enough to qualify for government programs. These consumers would potentially benefit from easier access to information about pricing for currently available floor plans at specific assisted living communities,” said Hanowell. “Unfortunately, that information isn’t often available.”
The lack of price transparency in the industry exists to not only encourage tours of facilities, but also because care needs vary among senior consumers, making it difficult to list pricing for services accurately without inundating prospective residents, according to Hanowell.
Written by Carlo Calma