How Much Does Private Home Care Cost?
The biggest question everyone is asking, Googling, and researching: how much is private home care going to cost my family?
Short answer: a lot.
It is by no means cheap, though it is cheaper than other senior care alternatives.
Genworth Insurance
Genworth is an insurance company that offers long-term care insurance, among other products.
Each year, they release their cost of care study. This study used to be annual or bi-annual, but now it is just a free tool online that anyone can use!
What’s great about this tool is that it is not only state-specific but specific to each region of your state. This development is especially important outside of New England in the large states around the USA. So if you live in a state like California or Florida, you will have specific data to your region of the state to plan in detail.
What is great about this tool is that it also compares home care costs to the costs of assisted living and nursing home facilities. This way, you can contrast and compare the three main options for senior care services. The big three – private home care, assisted living, and nursing homes.
It’s Expensive
One important thing to recognize is that once you start researching senior care options, you will quickly see that no option from the big three is inexpensive. It all adds up quickly.
With Genworth, you can compare the services and what their costs are. For example, you can enter the number of hours for private home care and can compare that to assisted living and nursing home rates.
In the Massachusetts area, there is a range, with Boston being the most expensive home care costs at ~$33/hr, which for 40 hours a week of care would equal $5,200 per month. However, assisted living services to cost $6,100 per month, and nursing homes would cost $14,000 per month. So, in this case, private home care would be the least expensive.
It isn’t easy comparing the big three to one another. As detailed in a previous post, I do not consider private home care and assisted living communities to be competitors. We offer different services.
If you move your parent into an assisted living facility, their faculties may continue to decline. If she continues to decline, you may need to hire a private agency like Minute Women if they wish to stay at home instead.
This move will often dramatically raise your out-of-pocket costs and add stress to an already difficult situation.
Do you need help navigationg your home care options? We can help!
Contact Minute Women Home Care Today.
Insurance for Private Home Care Cost
Unfortunately, private health insurance, Medicare, or Medicaid does not reimburse for private home care services at the moment. So for the vast majority of customers, they will be paying out of pocket.
What can help mitigate the cost is long-term care insurance. Long-term care insurance is a product that you can pay upfront for or with installments. Once your parent has qualified for eligibility, you will be reimbursed up to the daily limit that your policy calls for private home care, assisted living, or nursing home services.
Reverse Mortgages
Reverse mortgages had a bad reputation for a long time and deservedly so. Little regulation and predatory tactics caused its downfall. Things have changed.
As seniors age, their largest asset is their home. They are cash-poor but house-rich, and reverse mortgages allow a senior to take equity out of their home to pay for senior care services and other necessary expenses that pop up.
There are many towns outside of Boston where working-class adult purchased their home in 1960 for $50,000, and it is now worth $900,000. Now older, they can use this equity to support their plans to age-in-place. In addition, with reverse mortgages, they have another tool to consider for paying for senior care-related services.
We will have a reverse mortgage specialist who will answer questions about reverse mortgages on our podcast The Caregiver’s Toolbox soon. Don’t miss it!
The Gap in Private Home Care Cost
As the cost of care increased because of inflation and labor costs, there is an ever-widening gap of people who cannot pay for senior care services. While nursing homes can be paid for by Medicaid, there is a seven-year look-back period. So if there are assets that can pay for the nursing home, they will find them.
Many find themselves too “rich” for Medicaid and state services but too “poor” to pay for private home care and assisted living costs for those looking to age-in-place. In Massachusetts, we are in the process of increasing the minimum wage to $15 per hour. We pay our caregivers more than this minimum wage. Why? Because we believe rising tides raise all boats. The wages of caregivers directly correlate to home care costs.
As these rates rise (my guess is within the next five years, private home care rates will reach $40/hr.), middle-class seniors cannot afford this home care cost.
Rising rates will also leave people who can afford services unable to afford the full amount they need. For example, a senior who needs twelve hours of care per day might only receive eight hours five days per week due to the increased costs.
Caregivers deserve a living wage, but there is always another side of the coin: costs will be rising dramatically over the next few years, leaving more people unable to pay for desperately needed services.
Key Takeaways for Private Home Care Costs
The big three of senior care (assisted living, nursing home, and home care) are experiences. These home care cost options add up quickly, and for some, even the least expensive (home care) is still too expensive to consider.
Some options pay for services like long-term care insurance, but most are out-of-pocket by utilizing savings, retirement accounts, or the equity they have developed in their home.
A great tool is the Genworth cost-of-care tool that allows you to compare what services cost in the different parts of the country and within your state of residence. If you feel you’re ready to explore the home care cost of senior care, call us today for a friendly chat about your options.