Senior woman sitting on a sofa with her daughter, planning for long term care

If the words "long term care" make you think of a nursing home, you're not alone. But long term care is about more than nursing homes – you have a lot of options to get the care you need. Best of all, those options often include staying at home where you’re comfortable. Let’s go over the different types as well as how to pay for long term care. After all, 70% of people age 65+ will need some type of long term care.* So let’s make a plan and make the situation less scary.

What is long-term care? It’s a form of healthcare that provides help when you can no longer complete two or more of the “activities of daily living” (ADLs) such as bathing, dressing, eating, and using the bathroom. Care can be provided by a nursing home, assisted living facility, adult day care center, or in your home with a home health aide.

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Types of Long-Term Care: A Reference

Every year, Genworth (an insurance company) breaks down the average annual cost of different types of long term care. Here are the most recent stats available, based on their 2023 survey.** You might not need this information now, but understanding it will help you make a solid plan for your future retirement expenses.

Senior man and woman standing outside together, smiling
Location Type of Care National Median Cost (2023) % Increase (2022-23)
Your home Homemaker services (licensed) $30/hour 7.14%
Home health aide (licensed) $33/hour 10%
Your community Adult day care $95/day 5.56%
Facility Assisted living (1 bedroom) $64,200/year 1.36%
Nursing home (shared room) $104,025/year 4.4%
Nursing home (private room) $116,800/year 4.92%

As you can see, these costs really add up! It’s crucial that you have a plan for what to do if you need this kind of care. Not everyone will – but if you do, are you likely to have that money lying around? I can help you make a plan so those numbers aren’t so scary. With a little planning, we’ll find a way to make sure you get the care you need and have a way to pay for it.

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What Do These Types of Care Provide?

The kind of care that's right for you will depend on your wishes and your health care provider’s advice. Here’s what the most common type of long term care services provide.

    Nurse helping a senior Black woman walk with a cane in an assisted living facility
  • Homemaker Services (Licensed). A homemaker helps you do the around-the-house chores you can't quite handle on your own anymore. These include grocery shopping, other errands, laundry, house cleaning, and help preparing meals. Getting help with these tasks allows many seniors to stay in their homes.
  • Home Health Aide (Licensed). A home-based health aide helps you with daily personal care, including bathing, grooming, and moving around the house. This is another type of care that lets you stay in your home. This person can't help with serious medical problems, but they can help with minor tasks such as changing bandages or applying topical medications or salves.
  • Adult Day Care. These daytime-only centers offer social interaction, meals, classes, counseling, exercise programs, and physical therapy. They're ideal for folks who have a family member helping them at home on nights and weekends (but who needs to work during the day).
  • Assisted Living. These full-time residential communities offer the kind of care a home health aide can provide, and the kinds of activities of an adult day care. They can't provide the kind of intensive and constant care of a nursing home. They're meant for folks who can't live by themselves, but who don't need daily medical care.
  • Nursing Home. This is for people who need medical care around the clock. You can get skilled nursing 24 hours a day, unlike an assisted living community.

If you’re like a lot of my clients, you want to stay home as long as possible. You may have family members who are willing and able to help provide care. I also have clients who’ve enjoyed assisted living because they prefer being around people. It all depends on what makes you most comfortable and fits into your lifestyle.

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How to Pay for Long Term Care

No matter which type of medical care meets your needs, you'll probably need help paying for it. Medicare won't cover most long-term care, which is what many people don’t realize until it’s too late. Neither you’re your health insurance, in most cases. That’s why private long term care insurance may be your best bet.

Did you know? If you meet all the federal government’s conditions, they will pay your nursing home costs for the first 20 days of your stay. For days 21-100, you’ll pay up to $194.50 per day. After day 100, you have to pay the entire cost of any care you need.* What happens if you need care for longer than that? What happens if there isn’t a Medicare-approved care facility in your area? That’s where long term care coverage comes in handy!

    Senior woman using her laptop to research long term care insurance options
  • Long term care insurance. These policies pay benefits when you need the kind of care described above. Most policies pay benefits when you need help with 2 of 6 activities of daily living (ADLs) or if you have certain medical conditions (such as dementia or other cognitive impairment). The insurance company will need to review your medical file, and may also want to do an in-person evaluation. Once your claim is approved and any waiting period has passed, the money goes to you as the policyholder, not to the caregiver or care facility. The good part about that is that you can reimburse expenses incurred by the people who help take care of you – family members, for example. Long term care insurance cost varies by age, sex, health, marital status, and how much coverage you want. If you’re over 50, you can expect to pay several hundred dollar a month to get six figures’ worth of LTC benefits.
  • Life insurance with long term care rider. Some life insurance companies offer a rider (add-on) that lets you access your policy’s death benefit to use for long-term care costs.
  • Annuity with long term care rider. Some annuities also have a long-term care rider that lets you access some of your accumulated cash to pay for care.
  • Self-insure. If you don’t have insurance or a life insurance policy, paying your own costs are the only way to get the care you need. Even if you’re wealthy, I still recommend using insurance to pay for care. Costs increase every year, so why leave yourself open to those increases? Use an insurance policy where the insurer is the one responsible for managing investments in a way that provides them with enough cash to pay their policyholders’ claims.

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*, “Understanding Medicare & Medicaid,” accessed 4/13/23
**Genworth Cost of Care survey, 2023, accessed 4/10/24