How much do nursing homes cost?
A nursing home can be a necessary transition, helping an elderly loved one live safely and comfortably. Learn more about costs and services of nursing homes.
Before a loved one moves to a nursing home, there will no doubt be a whole host of questions that you’ll want answering; about the care, the cost and plenty of other things. Our handy guide offers insight into the fundamentals of nursing home financing, and will go some way in setting your mind at ease before your elderly loved one makes the transition.
What are the different types of nursing home care?
A nursing home provides around-the-clock care for residents, including three meals a day and assistance for daily tasks like dressing and bathing. Some nursing homes can also offer rehabilitation and recovery services, covering physical, occupational and speech, whereas others can support those who require more specialist services such as feeding tubes or respirators. As such, there are a variety of nursing homes available, offering different price brackets as well as levels of care.
Board and care homes offer residents standard around-the-clock assistance, and are generally small, private facilities. They do not usually provide specialist care.
Skilled nursing facilities provide more specialist medical support to residents, who may be using the home as a place to recover from illness rather than living in full time. However, others with ongoing needs may require regular care from more skilled nursing staff.
Assisted living communities allow residents to live independently where possible, offering them support with medication management and other regular tasks like laundry or general housekeeping. These types of facilities can vary in size and the types of accommodation they offer.
Continuing care retirement communities (CCRCs) offer a range of care and facilities on one single campus, with independent living, assisted living and skilled nursing care all available to residents of varying needs.
How do nursing home fees differ?
From the type of care to your location, there are all sorts of variables that can impact the cost of nursing home care. The average monthly cost of a semi-private room in 2022 was $8,000, while for a private room that rose to $9,300. But these costs are simply an average, and your family’s unique situation will mean that the monthly cost you incur could look very different to these figures. For instance, the cost of a private room in a nursing home for those living in Alaska was $32,457, while in Iowa that figure was $7,676. Senior Living has pulled together a helpful list of the expected nursing home costs in 2023, which you can find here.
However, it is not simply by location that you can expect nursing home fees to differ. It makes sense that the more care a resident needs, the more they can expect to pay. So, while those in assisted living communities may need help simply for everyday tasks, those in skilled nursing facilities may require physical therapy, memory care or other specialist support that will accumulate at a higher cost.
Can I get financial support for nursing home fees?
The good news is that financial support is available to some people that require nursing home care. It would be unrealistic to expect everyone in the US to pay the sometimes enormous fees for necessary nursing care, which is why you may be eligible for financial aid.
Medicare is one short-term option that many people in the US turn to for help with paying nursing home costs. A nursing home stay will be covered by Medicare if the person:
Enrolled in Medicare Part A
Has had a qualifying hospital stay of at least three consecutive days
Has had their services ordered in a skilled nursing facility by a doctor
The services covered by Medicare include all three of physical, occupational and speech therapies, alongside general nursing care. The skilled care benefits can vary depending on the time period in which the person resides at a nursing home.
From days 1–20, Medicare will pay the full cost
From days 21–100, the resident must pay coinsurance worth $194.50 per day
From day 101 onwards, the resident must pay the full cost
Medicare is incredibly helpful to nursing home residents in the short term, but other methods of payment are required for longer term stays. Medicaid, for example, is an additional means of paying nursing home fees. Those that are eligible will have their full fees paid for, but the criteria for claiming this level of support is aimed towards those with very low income and assets. Eligibility varies from state to state, and you can find the full details here.
Other financial aid includes Veterans’ benefits, which contributes up to $1,800 a month to skilled nursing care, and long-term care insurance packages, which can help to cover a portion of the fees.
What is the best way to save for nursing home fees?
No two financial situations are the same, and life can be unpredictable. You may not have a concrete idea of when a loved one may need to be moved to a care home, leaving little time to gather the funds required. Or you may be incredibly organized and spend years planning out the financials to make sure that nursing home fees are adequately covered. Either way, there are ways of saving up.
If you or a loved one need nursing home care right away and additional financial support won’t cover it, you may have to sell off some of your assets to fund it. If your loved one is moving from their own home to a nursing home, then selling the property to fund their care makes financial sense — particularly if it’s unlikely that they will return to their original home, and are needing more significant support. Otherwise, additional assets like their cars or personal property may need to be sold.
However, if you’re looking at protecting yourself and your family for when the time comes for you to enter into care, you can start planning and saving. It’s widely advised that you have enough money for two years of care saved up — around $100,000, depending on the type of care you may have — as a means of self-insurance. Putting money aside each month can be hard, but the earlier you start saving, the better position you’ll be in if you are in a position where you require care. But along with your own savings, you can join the approximately 7.5 million Americans paying for long-term care insurance. Typically, people start looking into this option around age 50, where an annual premium can range between $1,500 to $2,300.
As with anything, the earlier you start planning, the less likely you are to be financially vulnerable when the time comes for needing care.
Your financial future is in your hands. Let us help you make the most of it. With Unbiased, you can find your perfect financial advisor and start planning today.
Charlie Barton is a writer at Unbiased. He has been writing about personal finance and investing since 2017, with extensive knowledge of platforms and products. Charlie has a first-class degree from the London School of Economics.