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cost of care

  • National spending for "formal long-term care" in 2000: $137 billion (does not include family volunteer caregiving).1
  • Paid for by Medicaid: $62 billion or 45%1
  • Paid for by Medicare: $20 billion or 14%1
  • If the work of unpaid family caregivers was replaced by paid home care providers, estimates are it would cost $196 billion.4
  • Percentage of Medicaid spent on ages 65 and over: 24%.5 Of this amount, 72.5% is for institutional care and 27.5% for home and community-based services.4
  • Medicaid spending accounts for 20% of state budgets, the second largest expenditure after education.1,2
  • Despite federal and state spending, one-third of long-term care expenses are paid out-of-pocket by individuals and families.4
  • By 2030, spending for Social Security, Medicare and Medicaid will amount to almost 60% of the federal budget.3
  • Medicare covers 83% of all who die in the U.S.2
  • 58.5% of Medicaid spending went towards nursing home care.4
  • 35% of the annual federal budget goes to programs benefiting older persons.1
  • When Medicare was introduced in the '60s, 9% of the population was 65 and older, 0.5 % (1 million) was 85 and older. When the baby boomers start turning 85 in 2030, Medicare will be covering costs for 20% of the U.S. population, including 9 million who will be over 85.1
  • The Congressional Budget Office predicts that the cost of long-term care will reach $207 billion in 2020 and $346 billion in 2040.

·   ·   ·


  • About 70% of nursing home residents are supported, at least in part, by Medicaid.8
  • More than 90% of assisted living facilities are privately funded.4
  • Avg. cost of a private room in nursing home in U.S.: $74,095/yr, or $203 a day.6
  • Avg. cost of a semi-private room in nursing home in U.S.: $64,240/yr or $176 a day.6
  • Avg. cost of a semi-private room in nursing home in New York City: $112,420/yr or $308 a day.6
  • Avg. cost of assisted living facility: $34,860/yr or $2,905/month.6
  • Avg. hourly rate for Home Health Aide provided by a home care agency: $19/hr
  • Avg. in New York: $15/hr (2005)6
  • Avg. hourly rate for a Home Health Aide as reported by the Bureau of Labor statistics: $8.77 nationally, $8.89 for New York state. (2003)7
  • For 2004, Medicare payments for Home Health Care averaged $4050 per patient for an average of 31 visits at $129 per visit9
  • Visiting Nurse Service bill to Medicare/Medicaid for nursing services: $135/visit

1 "Taking Care-Ethical Caregiving in our Aging Society", The President's Council on Bioethics, September 2005

2 "White Paper - Living Well at the End of Life, Adapting Health Care to Serious Chronic Illness in Old Age", Joanne Lynn and David M. Adamson, RAND, 2003

3 President Bush's State of the Union Address, Jan. 31, 2006

4 "Long-term Care Report," Special Committee on Aging, U.S. Senate, June 2002.

5 CMS, Dept. of Health and Human Services, 2005

6 MetLife Market Survey of Nursing Home and Home Care Costs, 2005

7 "Across the States, Profiles of Long-term Care: New York", AARP Public Policy Institute, 2004.

8 "Nursing Homes Fact Sheet," AARP Policy and Research, February 2001.

9 "Medicare Home Health Utilization and Payments, 2004," National Assoc. for Home Care and Hospice

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posted nov. 21, 2006

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