Despite the difficult economy, the costs in every category of senior care continue to rise. Assisted living centers are still among the most affordable options, and are usually about half the cost of nursing home care. But older Americans can also choose to hire in-home health aides or homemakers to assist with the activities of daily living or household chores. Initially, this may look like the most financially attractive option. But a careful analysis of the total costs of remaining at home, versus the costs of an assisted living center, is a necessary step toward any final decision.
According to the 2009 MetLife Market Survey of Long-Term Care Costs, national average assisted living base rates increased by 3% last year to $3,131 a month or $37,572 annually. At the same time the national average hourly rate for home health aides increased by 5.0% to $21.
Before you begin an in-depth cost analysis, start by honestly assessing your needs. If you think you'd require only two hours a day of home care (whether health aide or homemaker or a split) then your monthly total would be 2 hours X $21 per hour X 30 days, or $1,260 a month. Four hours a day would $2,520. Anything over four hours a day, and you begin to rapidly approach the average monthly base rate of $3,131 for an assisted living center. And because that base rate generally includes rent, at least two meals a day, weekly housekeeping services, 24-hour health aide assistance, and health services like medication management, an assisted living center can begin to look like a no-brainer.
Here's where things start to get tricky. Above and beyond that base rate, costs for things like entrance fees and extra services can be prohibitively expensive. Some assisted living centers, specifically those marketing themselves as 'Continuing Care' facilities, can have entrance fees from $60,000 to $120,000. This is due before you even begin paying the $3000 per month to live there. However, the Continuing Care model is designed to provide services that evolve and increase as the resident ages, incorporating medical and nursing care as necessary, to ensure that the senior need never leave the community for a nursing home if physical or mental disabilities become significant. In short, the one-time entrance fee provides peace of mind in knowing that you will not have to move to a more expensive and restrictive facility in the future.
Assisted living centers which don't subscribe to the Continuing Care model generally have no or minimal entrance fees, but do charge extra for services and amenities not covered in the base rate. These extra can range from $10 per month for a haircut at the on-site barber shop, to $375 per month for access to skilled nursing care.
Living Center Services That May Cost Extra:
To get an accurate sense of the true cost of any assisted living center, there are some key questions to ask during a visit or consultation. What does the basic monthly cost cover? (Get it in writing.) Is there a written schedule of fees for extra services? (Request a copy.) Under what circumstances might the fees change? Is there a security deposit? Can service agreements and/or contracts be amended or modified?
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Once you know the true costs of an assisted living center, the final step in your comparison is to weigh them against the true costs of staying at home. Totaling up the monthly expenses in the following categories will get you to your ultimate cost comparison:
Your Present Home vs. Assisted Living
If this all seems a bit complicated, sit down with a calculator and a pad of paper and first add up your present home costs. Then go visit some assisted living facilities. Take along a list of the cost categories above. Ask the key questions, and make sure you get a firm dollar amount for each category. Go home and add them up. The last step is to compare the total for each facility against the total for your home expenses.