Insurance company, New York Life, and long-term care administrator, Univita Health, identified the 25 most expensive markets for long-term care coverage based on the average annual rate of a private room in a nursing home.
The regions that have the most expensive markets are:
|Market||Annual Rate of Private Room in a Nursing Home|
|New York-Northern New Jersey-Long Island, NY-NJ||$155,180|
|San Diego, CA||$135,554|
|San Francisco-Oakland-San Jose, CA||$130,283|
|Philadelphia-Wilmington-Atlantic City, PA-NJ-DE||$129,239|
|San Jose-Sunnyvale-Santa Clara, CA||$127,130|
|Miami-Fort Lauderdale, FL||$116,931|
|Buffalo-Niagara Falls, NY||$116,577|
|Los Angeles-Riverside-Orange County, CA||$115,165|
|Detroit-Ann Arbor-Flint, MI||$114,716|
|Portland Salem, OR||$111,909|
San Jose, Boise, and Detroit are new additions to the list, while Anchorage dropped to second place from last year.
Univita Health asked 2,500 skilled nursing facilities, assisted living facilities, and home health care providers to complete 10,000 surveys between January 2013 and December 2013. Through their certification process, they were able to collect the data in a standard format.
Increasing Need and Cost
Statistics show that there is a rising need for long-term care services, especially now that baby boomers are entering retirement and senior years and more people are living longer. As the need rises, so does the cost of long-term care. According to a separate study conducted by New York Life, the average cost of nursing home care in the US has increased by 20 percent in a span of five years, from $73,935 in 2009 to $95,706 in 2014.
However, nursing homes are just one side of the spectrum. In fact, 50 percent of long-term care insurance claims start with home care, and its hourly rates have increased by four percent since 2009. When home care is no longer sufficient to meet a person’s needs, a transfer to an assisted living facility may be warranted. The rates of this care facility have hiked up by 34 percent in four years.
Overall, the cost of long-term care is not just about nursing homes. It’s about the series and levels of care that a person receives in the home, assisted living facility, and nursing home. Combined expenses from these settings can easily deplete a family’s savings.
Advantage of Having LTCI
Long-term care insurance also accounts for rate increases in long-term care settings through inflation protection. Through this feature, the benefits of a policy are increased over time to be at pace with the changes in cost of care rates.
With long-term care insurance, individuals can protect their assets and families from the financial breakdown that a long-term care event can bring. Apart from that, having a policy means having control over the kind of care that you will receive. It gives you more options and the freedom to decide according to your preferences.
Location: An Important Factor in LTC Planning
As you prepare for long-term care, it’s important that you know where you will receive care because cost of care varies per region. When you’re aware of the cost of care in your area, you will have an idea on how much long-term care insurance benefits you need or how much you need to save should you wish to self-insure for long-term care.