What you didn't know you didn't know about senior living: The cost Part 1.
I can always tell when it’s someone’s first visit to an Assisted Living Facility (ALF) when they look at our rate sheet and sheer panic crosses their face. ‘Is this the first ALF you’ve visited?’ I’ll ask, and they nod their head while staring wide-eyed at the prices.
There’s no two ways about it – senior living is expensive. My ALF is quite reasonably priced for our area (I keep track of what other ALF’s rates are), but I won’t lie and say it’s an easy expenditure to cover. I have a resident who is paying upwards of $7,000 per month, and that’s for ALF care, not a nursing home or memory care facility which both typically cost more. One study conducted in 2015 estimated that Oregon has a higher-than-average monthly base rate for assisted living at $3,880* (a related study suggested that the national average in 2016 was $3,628/month**).
You might be wondering how a resident at my ALF could possibly be paying almost $3,000 more than the state average. First of all, my ALF is close to Portland, and like rent anywhere else in the state, the closer you get to Portland, the more expensive it is. Second, there are two costs associated with assisted living. The first is the rent cost (the $3,880 figure), which includes meals, housekeeping, activities, utilities, transportation to doctor’s visits, and more. The ‘laundry list’ or included services can vary slightly from ALF to ALF, but the state of Oregon has specific regulations for ALFs, and most of these services are included under the state’s mandate.
The other cost is care, and my resident who is paying $7,000 is about as high care as they come for ALF. This is one area that ALFs all regulate differently, so I’ll do my best to explain how my particular company manages it.
Before anyone moves into our facility, I meet with them and ask questions which help me determine exactly what specific care we will be providing for them. For example, I ask if they’re diabetic. If they are, I ask if it’s diet controlled, managed via medication, or if they use insulin. If they use insulin, I ask if they self-inject and if it’s sliding scale. I then translate all that information for our health care staff. If they’re not diabetic, then I note that and we don’t provide diabetic care for them. If they are diabetic but it’s diet controlled, our staff will keep an eye on what they’re eating and how much, and our nurse will check in with them regarding their blood sugar level every now and then. If they’re sliding scale insulin diabetic, I have to work to coordinate their admittance with our nurse because all insulin shots must be delegated by an RN (meaning she has to individually watch each of our med-aides administer insulin to each individual diabetic patient and document that they are certified to provide diabetic care for that specific resident).
Sound complicated? It is! The care costs are based on the nuances I listed above. If a resident isn’t diabetic, we don’t add points to their care level. If they are but it’s diet controlled, we add a point for oversight. If they’re sliding scale, we add five points because their care is so much more intensive and requires RN oversight. Then, based on the points that resident has, I assign a Level of Care (LOC) from 1-6, and each level has a different cost associated with it (1 being the lowest and 6 being the highest). We have also made an exception to this rule, and I currently have two residents living in my building who are LOC 0. We provide no services for them, and they don’t require cuing or oversight for any Activities of Daily Living (ADLs). This is uncommon, but not unheard of. Our rent costs for my ALF begin at $3,800/month and our care costs for LOC start at $500/month, meaning typically the minimum that anyone is paying to live at my ALF is $4,300. That’s a lot of money!
Usually residents are paying for ALFs with a combination of incomes. This includes Long-Term Care Insurance, Aid and Attendance Veteran’s Benefit, investments and annuities, Social Security, home equity, and retirement savings. There are financial advisors that specialize in senior care costs and can help you determine what you need to be saving in order to afford senior care in the future, or what your options are if you started planning financially a little too late. These costs are based on the assumption that the resident is paying privately and can afford (through any combination of the above mentioned incomes) to pay out of pocket for senior living. In another blog post, I will discuss the options available if you or your loved one can’t afford the rate of ALFs.
*Genworth’s 2015 Financial Cost of Care Survey by State
**Genworth’s National 2016 Cost of Care Survey
