After her 90-year-old mother fell and injured herself, Sonya Tyler* hired a professional caregiver to help around the house for a few hours a day. Six months later, when her 92-year-old father began experiencing short-term memory lapses, Sonya knew they needed round-the-clock care. While her mom was open to moving to an assisted-living facility, her father insisted on remaining at home—and in his beloved neighborhood—for as long as possible.
As Sonya discovered, there are plenty of advantages to home care, including honoring her parents’ wishes and maintaining their quality of life and personal safety. But the decision to hire a professional caregiver often comes down to whether you and your loved one can afford it. What you may not realize, however, is that while home care can be expensive, factors such as where your loved one lives, the level of care needed, and insurance coverage, may make it a more affordable option than out-of-home care facilities.
Even if your loved one doesn’t require extra support right now, experts recommend having honest conversations with them about their care expectations and finances before an urgent need arises. “That can help lessen some of the emotion that can come with these conversations,” says Christina Irving, LCSW, Director of Client Services at the Family Caregiver Alliance in San Francisco. “These aren’t easy discussions to have, and you’re not usually going to be able to finish it in one shot. You’re often going to have to revisit these conversations.”
But the effort is worth it. By understanding your loved one’s wishes, and the costs and benefits of different care options early on, you can all get on the same page about your plan and how to pay for it.
What Makes Home Care a Worthy Investment?
With home care, professional caregivers provide personalized, non-medical assistance and support for your loved one, including help with daily activities, such as cooking, bathing, toileting, dressing, making sure they take their medications on schedule, and going to doctors appointments. Professional caregivers also offer companionship, supervision, physical activity, and cognitive stimulation—all from the comfort of your loved one’s own home.
Social engagement is a major bonus of home care services. Professional caregivers can help your older adult stay connected to their community—something that was particularly important to Sonya’s mom and dad. For instance, one caregiver would spend hours chatting with her parents, which made their time together feel more like a social visit, Sonya says. The caregiver also organized elaborate tea parties and invited her parents’ friends.
Family caregivers can also benefit from the extra help. By bringing in professional caregivers, you have more time to focus on things that may have been put on the back burner, like your own health, relationships, and work. Such opportunity costs can be substantial. According to a 2019 study, unpaid family caregivers lose out on about $67 billion in earnings because of work missed while caring for their loved ones.
Having extra help allows you to take on more of a care coordinator role, Irving adds. “You can make sure your loved one is being well taken care of,” she says. It can also strengthen your personal relationship with your loved one. “You get to go back to visiting with them and providing companionship and social engagement,” she notes.
In addition, a home care agency often takes a coordinated, team-based approach to care. “This is helpful because one caregiver may be seeing very different behaviors from your loved one during the day than another who works in the evening,” says Matt Neal, Chief Development Officer for TheKey. “They all communicate with each other and the family so that everyone knows what’s going on.”
The National Average Cost of 24/7 In-Home Care
Unlike some out-of-home care options (see below), there are generally no hidden fees with home care, which means you’re paying only for the coverage your loved one needs and can afford. Most agencies charge an hourly rate, which may include overtime. According to the latest Cost of Care Survey, conducted by Genworth Financial, the median cost for home health aide services in the U.S. is $27 per hour. Based on that rate, 24-hour care would come to $4,536 per week, or $18,144 per month.
Keep in mind that these are national costs. The price you pay may differ based on the number of hours of help your loved one needs each week, the level of care they require, and the caregiver’s hourly rate, which may depend on factors like shift length and potential overtime. You’ll also be responsible for any medications, medical equipment, and supplies your older adult needs.
It’s also important to consider what not having the right care might cost you. Professional caregivers, for example, can help prevent falls by making sure your older adult moves safely from one place to another. Such injuries can be dangerous for people 65 and older—for instance, in 2019, 3 million adults had a serious fall that resulted in a trip to the emergency room. Falls can also be expensive: Hospital costs averaged $2,607 per day throughout the U.S., according to Debt.org. If your loved one gets admitted overnight, costs tend to soar, especially when you consider that the average length of stay per elderly patient is 10 days, reports a study published in BMC Geriatrics.
Different Ways to Pay for 24/7 In-Home Care
There are a number of ways to help cover the costs of home care. A few options include Medicare Advantage plans, Medicaid, long-term care insurance, and VA insurance as well as personal resources, such as your loved one’s retirement income and savings account. Adult children may need to pitch in, too, depending on their parents’ financial situation. For more information on these options, scroll to the last section below.
9 Benefits of Home Care at a Glance
✔ Your loved one is safe and well cared for.
✔ Your loved one is exactly where they want to be (at home).
✔ Your loved one feels connected to family and community.
✔ Your loved one’s care is personalized for their needs and abilities.
✔ Your loved one receives companionship and socialization.
✔ Your loved one feels in control.
✔ Your loved one gets to spend more quality time with you since you’re doing fewer tasks and chores.
✔ Your relationship with your loved one becomes happier and less stressful.
✔ You have peace of mind—and so do they.
3 Out-of-Home Care Options for Older Adults—and What They Cost
Here’s what you and your loved one need to know about three other common types of older adult care options outside of the home.
1. Assisted-Living Communities
These facilities provide residential care for older adults who want to maintain a degree of independence, but may need help with some daily activities like cooking, and who also want access to medical care and skilled nursing services. Accommodations are similar to dorms, and residents live in their own apartment or room and share common areas. Meals tend to be served to residents in a group dining room.
Services vary but may include help with administering medications, housekeeping, transportation, around-the-clock supervision, and planned social and recreational activities. These facilities typically offer different levels of care; the higher the level of care, the greater the costs tend to be.
In general, assisted-living communities cost significantly less than nursing homes and continuing care retirement communities. The national median cost of a private one-bedroom unit in an assisted-living community is $4,500 per month, or $54,000 per year, according to the latest Genworth Cost of Care Survey.
However, amounts differ based on factors like location and the level of care a person requires. In addition to monthly rent, assisted-living communities often charge a one-time move-in fee that might run between $1,500 and $6,000. Your loved one might also pay extra for services like help with bathing or feeding, and they’ll be responsible for any additional caregiver support they bring in to help them, which could be costly.
2. Nursing Homes
Nursing homes, which are regulated by both the federal and state government, offer a more significant level of medical care than assisted-living facilities. A licensed physician typically oversees residents’ care, and physical therapists, occupational therapists, and other medical professionals are usually on-site.
Care recipients also have access to skilled nursing care around the clock. Nursing homes support residents with activities of daily living (ADLs), such as getting out of bed, getting dressed, eating, and bathing.
Fees vary by facility. Extras, like a private room, increase the monthly fee. According to the Genworth Cost of Care Survey, the national median cost of a semi-private room at a nursing home is $7,908 per month, or $94,896 per year. A private room costs $9,034 per month, or $108,408 per year. Typically, people pay for a nursing home out of pocket or through Medicaid, if they qualify. Some 62 percent of long-term nursing home residents rely on Medicaid. (Medicare fully covers nursing home stays for up to 20 days, and partially for the following 21 to 100 days. After 100 days, the care recipient pays the full cost.)
In addition to the monthly fee at a nursing home, there can be extra charges that can drive up costs. For instance, if your loved one needs to temporarily leave the nursing home, the facility may charge a bed hold, or a daily fee, to save their place.
3. Continuing Care Retirement Communities
Continuing care retirement communities (CCRCs) allow older adults to transition from living independently in their own home to assisted living to skilled nursing—all in one place.
CCRCs can be expensive. Your loved one can expect to pay a significant upfront fee, which can run anywhere from $25,000 to $1 million or more. Depending on the facility and the terms of the contract your loved one signs, they may also be responsible for paying a monthly charge. For instance, in 2021 (the latest year available), the national average monthly fee was $3,555, or $42,660 per year, according to the National Investment Center for Seniors Housing & Care, and the fee typically rises 2 percent per year.
If your loved one needs additional help while they’re living in a CCRC, you may decide to bring on a paid caregiver, which could substantially add to your costs.
Cost of Older Adult Care Comparison Chart
Here’s a high-level view of the different care options and what they cost.
|Type of Care||Charge||National Monthly Median Cost||Potential Extra Costs||What You Get for the Money|
(24/7 care at $27 per hour)
|Overtime fees, supplies, medical equipment costs||An older adult stays in their home, help with daily activities, companionship and supervision, one-on-one care|
|Move-in fee that could run between $1,500 and $6,000; fee for extra caregiver support; fee for help with activities of daily living (ADLs)||A degree of independence and help with some activities; planned social and recreational activities; different levels of care, including medical|
(semi-private room); $9,034 (private room)
|Bed hold daily fee, extra caregiver support fee||Support with ADLs; higher level of medical care overall, which typically includes a physician to oversee residents’ care and access to on-site skilled nursing care|
|Continuing care retirement communities||Monthly||$3,555||Upfront fee, which can range from $25,000 to $1,000,000+; extra caregiver support fee||Differing levels of care and services, ability for your loved one to stay in the same community as they age|
How to Help Pay for 24/7 Home Care
There are a number of ways to help cover the costs of home care. Here are some options to consider.
Personal resources: Families often use savings or their loved one’s retirement income to pay out of pocket for home care. Adult children may need to contribute some money as well, depending on their parent’s financial situation. To avoid any disagreements or tension, Christina Irving, the Director of Client Services at the Family Caregiver Alliance, recommends sitting down with your loved one and all involved family members at the very beginning of the process to discuss where the money will come from, how it will be allocated, and so on. “Money and family relationships can be difficult,” she says. That’s why it’s best for everyone to be involved from the start.
Medicare: Medicare will help pay for some skilled nursing in the home, but it won’t cover non-medical care by a professional caregiver. Medicare Advantage plans, which are offered through private insurers, may provide coverage for certain in-home services. Check your loved one’s plan for details.
Medicaid: Medicaid may cover some home care services, but eligibility and requirements vary by state. Contact your state’s Medicaid office for more information.
Long-term care insurance: This type of insurance can be an effective way to help pay for home care, but read the fine print, advises Deanne Belcher, RN, Regional Director of Business Development for TheKey. If your loved one is purchasing a policy, look for one that covers home care services—not all of them do—and that has a shorter, 15- or 30-day elimination period, which means coverage will begin sooner. Because long-term care insurance can be quite confusing, some home care agencies, including TheKey, have a team of experts who will help you understand your policy and navigate the coverage process.
Reverse mortgage: Available to adults aged 62 and older who have paid off at least a substantial amount of their mortgage, a reverse mortgage is a type of loan that allows older adults to borrow against the value of their home. They receive a lump sum, and they can use that money to pay for care. However, they will be required to repay the entire balance whenever they sell the home or move out. If they pass away, their heirs will be responsible for paying it off.
VA insurance: If your loved one has a Veterans Affairs (VA) healthcare plan, long-term home care may be part of their benefits. Eligibility requirements and covered services differ by program, but your loved one’s VA social worker can help you navigate it.
*Name has been changed for privacy.
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