Shopping for Long-Term Care

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Most people don’t think twice about bargaining for a new car. But when it comes to long-term care for a relative, skimping on Mom or Grandpa strikes some as unseemly. It makes sense to wheel and deal. According to the latest John Hancock Cost of Care Survey, the average annual cost for a private room in a nursing home is $87,235 — and rising. As Kelly Greene wrote recently in the Wall Street Journal, “Long-term-care costs add up quickly — and typically, there isn’t a way to know how long you will need the services.” The best way to keep costs down, in other words, is to start out paying as little as possible. Here are a few of Greene’s tips for doing just that.

Know your options.
The types of elder-care services — and the prices — vary. Home health aides help with bathing, grooming, and other daily tasks. At assisted-living facilities, residents can live independently but have access to medical and other support services. Nursing homes offer round-the-clock, on-site care and provide more complex medical treatment than assisted-living facilities typically do. If you’re not sure what your best bet is, try the free evaluation tool at assistedlivinginfo.com.

Check average prices by area.
Both Genworth Financial and MetLife provide local costs for long-term care (go to genworth.com/costofcare or metlife.com and search for 2011 market survey). As Greene points out, if your relative lives in a different part of the country, you can compare costs to see if it makes sense to move him to a facility near you. For more on out-of-pocket costs you might incur, go to medicare.gov, where you can learn what Medicare covers.

Consider in-home services.
Ask yourself if a home health aide might be sufficient before deciding on a nursing home or an assisted-living facility. According to Genworth, the amount you’ll shell out for the first has remained roughly the same compared with last year’s cost, while the price tag for the latter two options has increased significantly.

See if they’ll throw in something free.
Most nursing homes don’t discount their rates, but you may be able to get an upgrade to a private room or additional amenities if you are paying out of pocket. An assisted-living facility might waive the move-in fee, for instance, or knock a few hundred dollars off the monthly maintenance, particularly if there isn’t a waiting list. And if you book a substantial number of hours per week with an in-home service provider, ask if you might get a few additional ones at a discount, advises Greene.

Shop around.
Mention a lower quote if you have one. Often you’ll get a better deal if you’ve done your homework and have a better offer.

Plan ahead.
While it may be too late to lower the cost of care for an elderly relative by investing in long-term-care insurance, you may want to think about doing so for yourself. In addition to traditional stand-alone insurance, there are other options. One such alternative, reports Kiplinger’s Personal Finance, is a policy that combines life insurance and long-term-care protection, like Lincoln Financial’s MoneyGuard Reserve policy. By investing over time, you build up a reserve that can be paid out in monthly chunks to cover assisted-living-facility or nursing-home costs. If you don’t use it, your heirs get a death benefit. Another choice is longevity insurance, an annuity that pays out only when you reach a certain age (usually 85) and lets you use the money for any purpose.