We recently received a notice from my mother’s senior fortress. The basic “room and board” charge for her assisted living apartment (i.e., not the nursing care component) is going up from $8,100 per month to $8,750 per month, effective January 1, 2025. That’s an inflation rate of 8 percent.
Apparently, the average age of moving into any type of “senior dorm” is going up. From McKnights Senior Living, 2023:
the mean age of an older adult moving into assisted living is 85 (by comparison, it’s 82 for independent living and 83 for nursing homes), a finding that aligns with the results of other research.
It’s cheaper to stay in one’s existing house or apartment, even if some aides need to be hired, and there is more freedom, e.g., from coronapanic-style lockdowns. A middle-class American who did not purchase long-term care insurance (my mother has a John Hancock LTC policy and the company has been great about paying for most of what she has needed since transitioning from independent living to assisted) will have a lot of trouble accessing the necessary care. The standard path is for the old person to be wiped out financially and then Medicaid kicks in because the old person is now poor. In Florida, at least, the value of a homestead (primary residence) is excluded, but otherwise the only workaround is a Medicaid Asset Protection Trust and it must be done five years ahead of when it is needed (explained by a NY lawyer).
“Recent Immigration Surge Has Been Largest in U.S. History” (New York Times, today) quotes an economist saying the 10+ million Bidenmigrants “helped cool wage growth” (code for “lowered wages paid to native-born working-class Americans“?), so maybe the cost would have gone up more than 8 percent if the U.S. had defended its border?
Here are some pictures of my mom’s senior fortress…
The “wow” for prospective residents and their families is provided by the outdoor fountain:
(We offered her the chance to live in our guest room, but she wanted to have the opportunity to socialize with others her age.)
Assisted living would have gone down if wages went up. Inflation targeting is a seesaw. The lower wages go, the higher everything else must go. Don’t know why the public thinks inflation targeting goes 1 way.
The 85 y/o ALF residents must be in great shape with access to that lap pool! Is it heated? But if an ALF resident is fit enough to take advantage of a lap pool, then how does she meet the LTC requirement of inability to complete two of the five ADLs?
I thought the 50 years of low-skill immigration into the US was supposed to resolve the problem of costly nursing care for aging Americans.
My Mom went into a decent ALF facility (no fountains, no lap pool, 100 miles north of WPB) back in 2007. The rate back then was $4500/mo. all inclusive. Her excellent State Farm LTC policy paid 80% of her two year stay.
I purchased an LTC policy w/ Unum twenty years ago at age 40 for $25/mo providing up to $150K coverage. The premium is now $55/mo. and provides $250K coverage.
You seem like a good son.
Check out the depression era film “Make Way for Tomorrow,” by Leo McCarey that deals with these sorts of issues in a pretty unsentimental way.