The skyrocketing cost of elder care

Host Tanya Mosley opens with the growing number of families discussing whether parents can safely live alone, who will take them to appointments, and how care will be paid for. She cites an AARP study finding that family caregivers’ out-of-pocket spending is nearly 60% higher than five years ago. The oldest baby boomers are turning 80, and the number of Americans 80 and older is expected to double over the next two decades. At the same time, nursing homes are losing beds, professional caregivers are scarce, and Medicare generally does not cover long-term care.

Paula Span says the burden is especially severe for low-income families and people caring for someone with dementia. Caregivers often try to keep working but take days off, reject promotions, limit travel, reduce hours, or leave the workforce, sacrificing current income and future Social Security credits. Those costs are separate from paid care: a home-care aide averages $35 an hour, adult day programs $95 a day, assisted living $6,200 a month, and a nursing home $9,600 a month nationally, usually with a roommate. Assisted living ranges from about $6,300 monthly in Birmingham to nearly $10,000 in Boston.

Span describes adult day programs as centers where older people receive meals, activities, exercise, art, discussion groups, and sometimes nursing supervision while caregivers work. Transportation commonly brings participants to the center and home again, preventing them from spending the day alone. Although roughly $100 per day sounds expensive, Span calls the service an “unrecognized bargain” compared with home care or residential facilities. Families need not use it every day; two or three days a week may help, and Medicaid often covers the service. Veterans may qualify for special programs or discounts.

Span says her parents made caregiving comparatively manageable because they moved quickly from being well to becoming seriously ill, rather than experiencing years of disability. Her father disliked living alone, so she moved him from South Jersey to North Jersey, near her, and she and her sister hired an aging life care manager. These professionals, often trained nurses or social workers, identify facilities and home-care agencies, coordinate transportation and services, and dispute bills. Span jokes that they are how a caregiver can “clone” herself; the manager also helped resolve small conflicts her father was more willing to discuss with a professional.

Aging life care managers typically charge $150 to $300 an hour, Span says, but they do not provide routine bathing or meal assistance. They coordinate major transitions, then may check on a client monthly or every other week. Span valued having someone local to respond if her father became ill while she was traveling. She acknowledges that commenters called care managers another service for wealthy people, though she and her sister could split the cost. She also says families are poorly prepared: most people surveyed by KFF had never discussed future care, and few could afford $100,000 a year for a nursing home or $60,000 for home care.

Span distinguishes medical care, which Medicare covers, from long-term care such as help with bathing, dressing, toileting, meals, and avoiding falls. Medicare covers only limited post-hospital care, not ongoing daily assistance. About two-thirds of people will need long-term care, for an average of three years. Medicaid is the safety net for people with very low income, but eligibility generally requires reducing assets to roughly $2,000, and waiting lists can last months or years. People with money can purchase care, very poor people may qualify for Medicaid, but the middle class is largely left to pay alone.

Families patch together care by borrowing, withdrawing retirement funds, using parents’ assets, and alternating visits among relatives; smaller families and longer lifespans make this harder. Span says a peaceful death can bring grief and relief after years of stress, and families should recognize that some older people do not want every possible treatment. Palliative-care doctors focus on symptoms rather than extending life at all costs, while geriatricians take a broader view. Span has told her daughter that, if she is seriously ill and very old, the answer to almost everything should be “no thank you.”

Span says nursing homes often blame Medicaid reimbursement for reducing capacity, but staffing is the more important problem. About 1,000 facilities have closed in a decade, and many survivors have closed wings because aides earn roughly $20 an hour and can find easier work elsewhere. The pandemic drove workers away, while immigration crackdowns have further threatened a workforce in which immigrants make up more than a quarter of direct-care employees, and about a third overall. Turnover in nursing homes and assisted living can reach 50% to 80% annually, damaging continuity and comfort.

About two-thirds of family caregivers are women, Span says, with wives, daughters, and sisters usually carrying the heaviest responsibilities; proximity also matters, since the local relative is more likely to help. Mosley asks about people without family. Span says friends can form caregiving pacts and provide rides or companionship, but they may be the same age and unable to offer intimate or long-term care. She is researching a book about life in the 80s and argues that purpose, usefulness, and social connection matter more than endless leisure. The average 2022 IRA or 401(k) balance was about $200,000, insufficient for much long-term care.

Span points to Washington’s WA Cares program, funded by a mandatory payroll tax, which began paying benefits after its launch and provides a lifetime benefit of $36,000 indexed to inflation. Other states are studying similar plans, while Medicaid in every state can now pay a qualifying low-income recipient’s family caregiver, regardless of that caregiver’s income. She also mentions proposals for caregiver tax or Social Security credits and a new Medicare home-care benefit. Abroad, Japan requires long-term-care insurance for everyone over 40, while the Netherlands includes long-term care in its national system. Domestically, accessory dwelling units, shared housing, and “Golden Girls” arrangements offer alternatives: one California woman rented her spare room for $500 a month to a vetted roommate.