On The Costs Of Care, Or, You Don’t Want Every Item On This Menu

I don’t know if you’ve been thinking about it, but the costs of long-term care have been on the mind of some friends of mine lately.

For reasons that we won’t go into here, they are in the process of pricing long-term care at care facilities…and yesterday afternoon, we had a chance to have a look at the “menu” of services (the facility's term) that can be purchased at this particular location.

If you are facing this issue in your own family, if you are a taxpayer thinking about how we plan to fund long-term care in the future…or if, one day, you expect to be old yourself…this conversation will surely matter.

To protect the innocent, I won’t be mentioning names today, but here’s what you need to know:

The location in question is an “assisted living facility” located near Seattle, it is somewhat upscale, but by no means ”posh”, and it is a residence of substantial size, with dozens of clients living there. It is not a “mom and pop” business run out of a house, but instead a more corporate operation.

The first thing you are charged for is the “apartment” in which you reside and some basic services to go with it. Those services include “finishing the place” with blinds and appliances, weekly housekeeping and linen, and the power and the water and the cable (“Basic Extended”).

You’re also paying for the 24-hour staff presence, “recreation” services, and scheduled transportation.

Also included: two meals daily, but not breakfast.

Telephone charges are not included.

The cost, for a single person: $1900 per month for a studio, $2300 for a one bedroom, and $2800 for a two-bedroom. There are nicer “views” available, which add about $400 to each price. Adding a second person costs $600 extra every month.

You will note that this price does not include medical and “personal” services…and for that, we will turn to the actual “menu”.

"Old wood to burn! Old wine to drink! Old friends to trust! Old authors to read!"

--Francis Bacon, Apothegms. No. 97.

Start with the basics: a daily wake-up call is $50/month; having a load of personal laundry washed every week or having a staff member make the bed daily adds $70 monthly. Housekeeping is $30/hour…so hopefully the resident can clean their own apartment.

Breakfast is $95 each month.

To determine what additional needs you might have, a nursing assessment is conducted at the time of admission.

If it’s determined that the resident needs bathing assistance, costs work like this:

If the resident can wash themselves, but need to be watched during the shower, that service, once a week, is $165 monthly. If the resident needs a staff member to help them shower, add $60 (If two staff members are required, that’s an extra $140 monthly).

Can the resident dress themselves?

A daily reminder to change clothes costs $100/month. If a staff member needs to spend under 10 minutes a day to help the resident dress, that’s $175/month, if 15 – 20 minutes of assistance is required, that’s $250 monthly.

Can the resident take care of their own personal grooming? If they can’t, that adds $150 to the monthly charges.

There are also “toileting programs”.

Having the staff remind you to go to the bathroom costs $200/month (this also covers the occasional incontinence event), and having a staff member monitor you in the bathroom raises the rate to $275 (this also covers the occasional “bowel accident”).

A “structured toileting program” runs $350…and if you need to be checked for bowel accidents regularly, or need someone to wipe for you, or have regular accidents requiring changes of clothing, that’s $425 a month added to the bill.

Some people have had surgical procedures that require them to use a bag attached to their colon for waste removal. The site where the bag is attached is called a “stoma site”, and the service associated with stoma care is at least $250 monthly at this facility. Supplies (such as colostomy bags) are not included in this price.

Can the resident walk to meals on his or her own?

If yes, but they need a verbal reminder to go to meals, that’s $175/month. If the resident requires assistance to get to the dining room, that’s $225 monthly…and if it takes longer than 5 minutes on average to assist the resident, that adds $275 to the bill each month.

Special diets, prescribed by a physician, add $500 to the monthly bill.

Can the resident take their own medications?

If not, the minimum charge is $230 monthly, which covers up to 5 medications daily, “served” two times a day.

If the client takes more than five meds daily (or takes meds more than twice daily) that cost could potentially increase by another $165/ month.

Oxygen service: add another $150 monthly.

While all that seems expensive…we haven’t come to the big-ticket item yet.

There will be residents who will require “memory support”.

The simplest form of this service provides “redirecting, reassurance, orientation to surroundings, responding to questions/concerns that arise from diminished short term memory” and several checks daily to ensure the resident is on the property. Those who receive this level of service are also physically escorted to meals. The service costs $300 per month.

For $400 the resident is walked back from meals, and a staff member provides verbal cues to get the resident dressed. The resident will also be “convinced” to bathe, if need be.

If the resident requires physical cues to perform the same tasks, the cost jumps to $550 (and at this stage the resident might require two staff members to get them to perform personal hygiene).

The highest level of care also provides someone to check on the resident every two hours, and costs $800 monthly.

This is hardly a complete list: for example, there are charges for making appointments and other “clerical” services, for “concierge” service, and for other incidentals.

However, there’s one other significant charge about which you should be aware, and that’s the cost for nursing services.

Wound care that involves changing a dressing, and takes less than 5 minutes, is $15 for each occurrence. This service must be provided by a licensed nurse…and if you add it up, it works out to $180/hour that the facility is charging you for the services of an LPN/LVN (depends on where you live) who is not likely to be making above $25/hour. (Each dressing change that lasts from 5 – 10 minutes costs $20; meaning at least $120/hour.)

Add it all up, and the chances that you’ll be paying at least $3000 a month are (in the words of Johnny Mathis) awfully good.

"If Mr. Selwyn calls again, shew him up; if I am alive I shall be delighted to see him; and if I am dead he would like to see me."

--Henry Fox, the First Baron Holland

So how is all this relevant to politics, you might ask?

How about this: we are about to enter an age where millions of Americans will require this sort of long-term care…and many of us do not have $3000 per month available to pay for this kind of care.

How many? It is estimated that 70 million Americans will be 65 or over by 2030, and if the numbers from 1999 continue to be valid, roughly 30% of those people will be living in an institutional setting.

20 million people, at $3000 a month, equals $60 billion that will be required to cover the cost of long-term care for this group—each and every month. That’s $720 billion a year.

So how do we deal with the problem when it hits us?

I don’t know…but consider this: it is going to be tough to reduce these costs, if only because these are tasks that are not well suited for automation. These are services, for the most part, that require one-on-one care (or even two-on-one care)…and those who provide the care will want pay raises…which we will want to provide, in order to help keep the quality of care at a high level.

You should also know that there are substantial costs associated with “fixing broken workers”. The fact that workers are often required to assist clients that are physically large or physically awkward puts a lot of these workers out on injury leave…and the unhappy fact is that understaffing is a common way to try to control labor costs in nursing facilities, adding to the injury problem these workers face.

How bad is the healthcare injury problem? Ironically, the Bureau of Labor Statistics tells us health care facilities are the most dangerous work environment in the United States.

“General medical and surgical hospitals (NAICS 6221) reported more injuries and illnesses than any other industry in 2007—more than 253,500 cases.”

To put it another way, there are basically two kinds of healthcare workers: the ones with back injuries…and the ones who don’t yet have back injuries.

As we wrap this thing up, let’s ask that question we ask almost every time: what have we learned today?

If you hadn’t already been thinking about it, it is fantastically expensive to have to receive care at an assisted-living facility, and soon there may be as many as 20 million Americans who will be in that situation…or something even more expensive, such as “skilled nursing facilities” (more commonly referred to as “nursing homes”).

We could be looking at having to find $720 billion (in today’s dollars) to cover the annual cost of that care.

It is going to be very tough to reduce those costs, unless you can develop ways to deliver the same care in a less-expensive environment…or you can find a way to reduce the number of people who will require such care.

Considering the cost of “memory care”, money invested in Alzheimer’s mitigation today might pay huge dividends later.

So that’s the deal: there is a giant bill that’s coming due, we better be thinking about it now…and one way or another, this will become one of the biggest fights in American politics as we move into the middle third of this century—so we can either get ready for it now, or we can all act surprised later.

Of course, if enough of us require “memory care”…then I guess that surprised look on our faces won’t be an act, eh?


hate to put a damper...

...on the weekend, but what can i say?

"...i feel that if a person can't communicate, the very least he can do is to shut up." --tom lehrer, january 1965

Thanks, Fake.

This is good - and scary - stuff.

it is scary...

...but here's a thought that occurred to me as i was answering comments this morning:

in 2007, we spent roughly $700 billion dollars to import oil, which, coincidentally, is the same amount we would need to fund the long-term care numbers we're looking at here.

"...i feel that if a person can't communicate, the very least he can do is to shut up." --tom lehrer, january 1965

Thanks for this, Fake

When my dad got Alzheimer's, I knew less than nothing about long-term care. He had health insurance through United Health Care, was enrolled in Medicare, and had fought in both WWII and Korea, so I figured his out-of-pocket expenses would be minimal. I was wrong.

UHC would only pay for doctor/hospital visits, Medicare was mainly triggered by what UHC decided to pay with the exception of a short rehab period, and the VA didn't have any beds available. I did everything I could to preserve my parents' retirement portfolio, and I watched it shrink by $4,300 per month. The only saving grace was the decision to keep him home long past the time he should have been moved into a facility. One year's-worth of those fees and other co-pays was enough to suck some $60,000 out of an already modest amount. Two years would have left my mom damned near destitute.

Folks, trust me when I say: a retirement plan that doesn't include long-term care costs is not a plan at all, it's a fantasy.

i'll take that bet...

...and i'll raise you one: any health care reform initiative that doesn't address long-term care is also a fantasy...and i'l bet you that government becomes the "caregiver of last resort", whether republicans like it or not.

"...i feel that if a person can't communicate, the very least he can do is to shut up." --tom lehrer, january 1965

I was my Mother's sole caretaker

for six years. She had both Alzheimer's disease and a huge brain tumor, but was in otherwise excellent health. The brain tumor saved her from the horrible, terror-filled late stages of Alzheimer's. But I can tell you that this is not something a lone caretaker should have to do. Her modest savings long since sopped dry by a manipulative family member, there were no resources available for her care. The Alzheimer's Family Services in the area provides literature and once weekly meeting for caregivers, but they don't have provisions for the patients to be supervised during those support group meeting. What are you to do, leave them home alone? Medicare does not provide care for Alzheimer's patients, only routine medical care. Hospice does not accept Alzheimer's patients. The only residential care in the area that is humane is a for profit facility is the cost is over $5k a month, the "unit" at a local nursing home is a co-ed, locked unit with 20 beds and 1 employee per shift. This can't stand as it is, there must be compassion for the frail, lost, elderly in our society.

first, apologies...

...the pc and i have been arguing for about three days, and i finally ended the discussion by "rebuilding" the thing...which hopefully means that this comment will post today.

and with that said...

...i understand intellectually the significance of the fact that your mom was ambulatory, had not suffered from a stroke, wasn't being tube fed, and wasn't on a ventilator--but that did not stop me from uttering a great big "whaaa..." when i read this:

"She had both Alzheimer's disease and a huge brain tumor, but was in otherwise excellent health."

i haven't had to do it myself, but The Girlfriend (who has been a nurse for more than 30 years) tells me that it is virtually impossible for families to provide the type of care you were providing, much less for one person to do it.

adult day care is one answer to the question of what to do during meetings and to provide the caregiver a chance to run errands and that sort of thing.

"respite" care, where a third party provides temporary care to allow someone in your position a chance to take a few days off, is also a major help. (The Girlfriend provides care for developmentally disabled clients at a state facility, and that facility provides respite care for the families of dd clients who live in the community.)

the good news about both of these programs?

they save the state tons of money, by keeping clients in the community and thereby delaying the time when such clients might have to be placed in institutional settings. (in washington state, medicare pays, on average, $3500/month for assisted living or nursing home placements for all elder clients, $1100/month for those who can be cared for in-home.)

in washington state these services are also available for the caregivers of aged clients..and in fact, it is possible for family members to be paid as caregivers in the home, helping some families avoid the problem of replacing pay caused by having to quit a job to provide care.

the "medical cost" of alheimer's patients is roughly three times that for non-alzheimer's patients (in 2004, $33,000 vs. $10,000 annually), which seems to be because those with alzheimer's are more likely to be injured, and less able to recognize the early stages of problems that could have been fixed cheaper sooner.

as for hospice: unless the person is in their final months of life (if i recall correctly, it's the final six months), hospice would not be appropriate for that patient.

"...i feel that if a person can't communicate, the very least he can do is to shut up." --tom lehrer, january 1965

The costs in Seattle are lower than here in Wilmington.

My father has lived with us for almost 6 years. He is currently at home with us under hospice care. I know more about this subject than I want to know. I'll tell everyone here that they absolutely MUST get educated on the rules and law regarding Medicaid and nursing homes and how to protect your own and/or your parent/family's resources. It's different in every state...but there are some basics....and IF you will take the time to learn, you'd be amazed at the options. You will likely need a good medicaid/elder law atty...but it's worth it if there is an estate to protect.

BTW, a skilled nursing facility runs $180/day here...and that doesn't include all the possible additional costs. I'd say $6000/month minimum.

Stan Bozarth

I've been readng a book on Medicaid

trying to educate myself before I consult with an elder care atty. on my Mother's estate. You're right there are options but getting approved is still no small hoop to jump through in many cases.

Getting my uncle (now in a special assistance living facility) on medicaid was relatively easy because he had no assets other than a little money but I'm still trying to juggle his account to keep it under the $2,000 limit and keep enough in there to pay medical debts from before he was approved and pay all the little charges that still seem to add up even with Medicaid.

i have apologized already...

...to the other commenters here, and despite the reasons explained on this page i also owe you an apology for not having responded sooner...so please consider this that apology.

if you want to read what your potential attorney is reading, check out the elder law portfolio series.

at almost 3000 pages it's a nightmare to digest at once...but the cost is right, as it can be read at google books...and at a few pages a day, in a year you could easily knock it down.

a lot of the material is on how to market to elder clients, which you might not choose to read...but i would encourage you to look at some of the suggestions for how an elder law attorney should deal with issues such as the potential client's disabilities and how these attorneys should seek to protect themselves from the problem of the client who cannot recall what decisions were made on their behalf.

"...i feel that if a person can't communicate, the very least he can do is to shut up." --tom lehrer, january 1965

keep in mind...

...that this price list was for assisted living, not for a skilled nursing facility, and i would expect that price to be substantially higher, if only because of the increased medical intervention that is implied by placement in a snf (which, around here, is colloquially referred to as a "sniff").

i don't have the source in from of me at this moment, but i do seem to recall from researching this story that the national average for nursing home care is about $200/day, suggesting your $6000/month estimate is dead on target.

i do have this comment from the aarp website, however, that does seem to confirm that number:

"In 2008, the average private pay cost of nursing home care was about $76,000 per year for a private room and $68,000 for a semiprivate room. For services in the community, the average private rate for a home health aide in 2008 was $19 per hour."

keep in mind, however, that medicare pays far less than "private payers", which would lower the figures by some unknown amount.

please note that the apology i offered in my reply above also applies here...so my bad for not responding sooner.

"...i feel that if a person can't communicate, the very least he can do is to shut up." --tom lehrer, january 1965