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By Elizabeth O'Brien
June 24, 2021
Male nurse giving instructions to senior patient when to take his pills in nursing home
Getty Images

An average healthy 65-year-old couple has a 75% chance that one partner will require significant long-term care in later life and a one-in-four-chance that both will need such care, according to a new report that aims to quantify one of the biggest wildcards in retirement planning.

Some people die without needing any care in older age, while others (dementia patients in particular) need assistance for years. For most older adults, the reality lies somewhere in the middle, according to the report by HealthView Services, a Danvers, Massachusetts-based company that provides health care cost data to financial advisors.

“One of the most important things is to know what the numbers are,” says Ron Mastrogiovanni, CEO of HealthView Services.

In other words, understand the likelihood that you’ll need care and how much it might cost. While home-based care has grown in popularity during the pandemic, families might not know that staying home can be a lot more expensive than relocating to a facility, Mastrogiovanni says. Twelve hours of home care a day roughly equates to the same cost as a nursing home, while 24/7 home care costs double what a bed in a facility costs.

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How much does long-term care cost?

Costs for such care vary greatly by location. A 65-year-old man with no health conditions has a 44% chance of needing long-term care by his actuarial life expectancy of age 87, according to the report. That care is expected to last 660 days and cost $123,881 in today’s dollars, assuming national average costs across all states, the report projects.

A healthy 65-year-old woman living to an actuarial life expectancy of age 89 has a 56% probability of needing long-term care, the report found. Her average duration of care will be 992 days and projected costs will be $183,841 in today’s dollars.

Women live on average two to four years longer than men, so planning for heterosexual couples must take that into account. “Now, the widow is on her own, and she doesn’t have a spouse to care for her,” Mastrogiovanni says. Often, the husband needs care first, and without careful planning resources can get depleted on him before it’s the woman’s turn.

People might assume that since they’re healthy, they have a lower likelihood of needing care. In fact, the reverse is true, Mastrogiovanni says. The need for care correlates closely with age, and people with chronic conditions like diabetes and heart disease tend to die younger than those in good health. (That said, when people with chronic conditions do need assistance, they end up needing it for longer than healthy people, on average.)

65-Year-Old Female
LTC Probability Length of Care Required Life Expectancy
Cardiovascular Disease 61.2% 946 days 88
No Conditions 56.0% 992 days 89
High Cholesterol 48.4% 1,000 days 87
Tobacco Use 34.9% 1,053 days 84
Type 2 Diabetes 32.7% 1,072 days 81
Source: HealthView Services
65-Year-Old Male
LTC Probability Length of Care Required Life Expectancy
Cardiovascular Disease 45.1% 630 days 85
No Conditions 44.3% 660 days 87
High Cholesterol 37.1% 663 days 85
Tobacco Use 25.5% 690 days 82
Type 2 Diabetes 20.1% 700 days 78
Source: HealthView Services

How to pay for long-term care?

Medicare doesn’t cover routine long-term care. The federal health insurance program doesn’t pay for help with daily needs like bathing and dressing, regardless of the setting. So families are on their own, whether the care is provided in a nursing home, assisted living facility or at home. (Medicare will pay for shorter, rehabilitative stays in nursing homes, typically following surgery.) Medicaid, the health insurance program for low-income Americans run at the state level, pays for long-term care only for those who meet strict income and asset criteria.

Often, a combination approach can work when it comes to funding care needs, Mastrogiovanni says: for example, self funding plus an insurance product. (Money has an overview of popular long-term health insurance companies here.)

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