Although the in-home care industry is the leading job creator and demand for these services is far outpacing other types of long-term care, those rising costs are starting to take a toll on various agencies, organizations, and individuals who desire to remain home.
In fact, the cost of home care is far outpacing other long-term care options like nursing home and assisted living facilities. While nursing home care saw a very small increase for their semi-private and private rooms, generally between 1% and 2%, home care’s cost increased by over 7 percent.
According to McKnight’s Long-Term Care News article, Home health care charges rising faster than nursing homes’, written by Danielle Brown:
“The findings were detailed in Genworth’s 2019 Cost of Care Survey, which revealed that annual median cost for homemaker services reached $51,480 — an increase of 7.1% between 2018 and 2019. For home health aides, the annual median cost reached $52,624 — an increase of nearly 4.6%.
Charges for nursing home care, however, increased by just 0.96% for a semi-private room and 1.82% for a private room. The annual median cost for a semi-private nursing home room was $90,155, and for a private room $102,200.
Charges for assisted living also stabilized over the past year.”
There are numerous reasons for the increased cost of home care. First, it is likely due to basic economic factors of supply and demand. With more baby boomer seniors retiring, grappling with health issues, and preferring to remain home, they are placing increased pressure on the industry as a whole.
Second, as more hospitals seek to reduce their readmission rates, they are turning to home care providers to help support patients upon discharge. As more visiting nurses are required to monitor vital stats and change wound dressings, administer medications and so forth, there is a greater need for skilled workers within the home care sector.
Third, it may be directly related to reimbursement rates that were cut at the Medicaid level. When the federal government cut Medicaid reimbursements for in-home health care services in order to help pay for the Affordable Care Act of 2010, it placed increased pressure on home care agencies and other businesses.
Some of these businesses had to turn to private pay more than Medicaid funded clients. There have also been new regulations, certification requirements, and an increasingly difficult time obtaining and retaining valuable home care workers.
The article also went on to note that:
“Experts believe costs of home care are rising due to everybody’s tightening labor market, compliance for new local, state and federal certifications and regulations, and shifts in post-acute Medicare reimbursement, according to a release.”
While the full scope of these increases may not impact the industry in the short run, there could be long-term ramifications that need to be addressed openly and honestly. Home care continues to be the most affordable long-term care option available for aging seniors and the disabled, but if the costs continue to increase at this pace, it may cause unexpected and unintended repercussions in the future.
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