Nursing Home Costs Rose 3% In 2007

 By Kenneth Ingram

           The average cost of nursing home care was up nearly three percent this year over 2006, while home health care costs rose 12 percent, a study by New York Life Insurance Company finds. The rate of increase was moderate compared to 2006, when nursing home costs rose an average of six percent over the year before.

New York Life’s latest study shows the nationwide average cost of a nursing home private room with a single occupant climbed in 2007 to $209 a day, or $76,322 per year, from around $204 per day in 2006, or $74,445 per year.

Semi-private rooms, with double occupancy, rose to an average of $185 a day, or $67,554 a year this year, compared to $180 a day, or $65,700 a year in 2006.

The hourly rate for a home health aide hired from a Medicare-certified agency averaged $37.36 per hour in 2007, or 12.2 percent over last year. Hourly rates across the country ranged widely, but the combined average hourly rate for Medicare-certified and non-certified home health aides is $28.17, a 6.1 percent increase from 2006, New York Life found.

“In general people assume that Long Term Care (LTC) refers to care in a nursing home, however most LTC is received in the home,” declares Kenneth L. Ingram, CFP® of Ingram & Raucci Insurance and Financial Advisors.

According to the study, the highest daily rates for private nursing home rooms in the U.S. were in Alaska ($407 per day); southern Connecticut ($348 per day); the Connecticut Valley ($322 per day); the Hudson Valley, N.Y. ($318 per day); and the Boston area ($299 per day).  Those regions were the same highest-cost areas New York Life reported last year.

The four lowest-cost areas for semi-private nursing home care in the latest survey were all in Texas:  Dallas/Fort Worth ($111 per day), Corpus Christi ($112 per day), San Antonio ($113 per day) and Austin ($116 per day). For average hourly services of a home health aide from a Medicare-certified provider, the lowest-cost area the company found was Charleston, W.V. at $15.67.

Ingram says the New York Life Insurance Company plans to build the results of the study into the customer illustration program used by its sales force, with data customized to each representative’s local area.  The company saw LTC insurance sales increase 15 percent in 2007. That field force is 8,000 strong, although not every New York Life agent sells LTC insurance, Ingram notes.

Conducted by CareScout, a research arm of National Eldercare Referral Systems Inc., Wellesley, Mass., the study covered more than 3,000 nursing homes across 120 metropolitan areas as well as 2,800 health care providers.  

Kenneth L. Ingram is the president of Ingram & Raucci Insurance and Financial Advisors.  

For Additional Information 

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