While retirement communities and independent living facilities are popular choices for older adults who want to downsize or can no longer manage the upkeep of their family home, surveys confirm that most Americans hope to age in place. Unfortunately, barriers to remaining in a home after children move out can make it difficult for seniors to achieve that goal.
Recent data suggests that more than half of Americans will develop disabilities requiring long-term services and supports (LTSS) after they reach age 65. Disabled seniors will need LTSS if they cannot perform all their activities of daily living (ADLs) without assistance.
According to the Center for Retirement Research at Boston College, about 20% of seniors will never need LTSS. Another 26% will need LTSS for more than four years. About half will need assistance performing at least two ADLs, even if only for a short time.
At least a third of seniors will need nursing home care at some point. The duration of a nursing home stay will depend on whether that patient needs short-term care while recovering from surgery or an illness or has a permanent condition that requires round-the-clock care. Most seniors who develop a need for nursing home care are unlikely to spend years in a nursing home.
Some disabilities are manageable with occasional help from family or paid caregivers. Others are catastrophic, creating a need for round-the-clock medical care. A large percentage of disabled seniors fall between those extremes. They need regular assistance with ADLs but don’t need to be in an institutional environment to receive it. They might be good candidates for aging in place, but remaining in their own home isn’t as easy as it sounds.
The Rising Cost of Home Care
Many people developed a negative attitude about nursing homes and other institutional care providers during the pandemic. While seniors may prefer to age in place, however, many will need home care. Sadly, families are not always able to cover that cost.
A recent Wall Street Journal article describes the “crushing financial burden” of aging in place. The burden is driven by the expense of home care. Less than ten years ago, the median cost of hiring a home health aide through an agency was $13 an hour. The median cost today is about $33 an hour. A parent who needs around-the-clock care can expect to pay about $290,000 a year.
The WSJ reports that the annual expense of around-the-clock home care is twice the cost of a private room in a nursing home and four times the cost of a private room in an assisted living facility. While most seniors might hope to age in place, those who need substantial help with their activities of daily living may find that moving into an assisted living environment or nursing home will be their only affordable option.
The high cost of home health care can be partially explained by a shortage of workers who are willing to act as home health or personal care aides. Wages are not commensurate with the difficult nature of the work. According to the WSJ, workers earn a median wage of $16.12 an hour. That’s about half the rate charged by the agencies that employ them.
Because agencies that furnish home health aides to seniors must pay overhead costs in addition to wages, they may find it difficult to increase pay without increasing the rates they charge their clients. They also compete with assisted living facilities and hospitals to find workers who are trained to provide the services required by the position. That competition may become fierce in coming years, as demand is projected to increase by 48% for nursing assistants, 43% for personal care aides, and 42% for home health aides by 2035.
Hidden Costs of Aging in Place
The cost of home care isn’t the only financial burden of aging in place. The Census Bureau estimates that only 10% of American homes are “aging ready,” meaning they have a step-free entryway, a bedroom and bathroom on the first floor, and an accessible bathroom.
Renovating a home to make it more “age friendly” can be a costly proposition. While simple changes, such as adding grab bars in a shower, might be affordable, widening doors to accommodate a wheelchair, installing stair glides so a senior can reach a second-floor bedroom, and installing smart-home devices, such as a voice-activated home assistant, are expenses that seniors need to consider when they weigh their options.
Home health aides and personal assistants may or may not prepare meals and perform light housekeeping services. Seniors may need to hire maids and pay for regular food deliveries to supplement the services provided by the agency worker. They may also need to pay a landscaping service to take care of the lawn and a handyman to clean gutters and make repairs that the homeowner can no longer manage.
Even when family members pitch in to help their aging relatives so that home care and other outside services can be minimized, their volunteer efforts have a cost. Adult children who act as caregivers for their parents make financial sacrifices by foregoing overtime, working part-time for their employers, or not working outside the home at all. Children frequently sacrifice their careers to take care of their disabled parents.
There is no one-size-fits-all solution for older adults who want to age in place. Seniors who are still in reasonably good health and those who can afford support services are in the best position to do so. Seniors who live in rural areas might find it expensive to arrange transportation for medical appointments. When adult children sit down with their parents to discuss future housing plans, they will need to discuss both the obvious and the hidden costs of the parents’ options.