Cost of In-Home Care for Elderly and Aging Seniors

The cost of in-home care for elderly may not be something you spend a lot of time thinking about, but it is important. By the time you turn 65, you have an almost 70% chance of needing some form of long-term care in the years that follow. Many seniors would prefer to be able to stay in the home they are familiar with, with the neighbors around them with whom they’ve become friends. However, long-term care can be expensive, even in your own home. But, we can’t deny that as we age, there is an increasing chance that we will need frequent care and assistance with our everyday lives. If you’re curious about planning your future, planning for the cost of in-home care allows you to remain in your home while receiving the care you need. It ensures dignity and familiarity and offers a level of independence that is not always possible in a nursing home or a retirement community. If you start your planning today, you’re protecting your quality of life in the future.

The cost of in-home elderly care can vary depending on numerous different factors. The source of the care, the type of in-home care that is required, how you pay for in-home care, and many other variables can affect the cost of in-home care for seniors. In this guide, we’re going to go over the various factors that have an effect on the cost of in-home elder care and give you some advice for how to plan for a better life for the future you.

As we age, we encounter an increasing number of health issues, both mental and physical. Some of these can be debilitating. For instance, as Alzheimer’s progresses, patients find increasing difficulties performing everyday tasks. Dementia can also make day-to-day life difficult without some assistance. While we may have family and friends we’re close with, relying on them to care for us as our needs grow can be putting a heavy burden on those we love. The only other option for seniors who want to remain in their own homes but who also require assistance getting through their day is to find some in-home care.

In-home care is a form of long-term care where a caregiver comes into your home to help you. This help can take many forms. A caregiver can be there to provide assistance with everyday tasks such as bathing, meal preparation, housekeeping, caring for pets, paying the bills, and transportation. They can also provide healthcare in the home, including administering medication, physical therapy, health monitoring, and more.

The type and quantity of in-home care each patient needs will vary and change over time as conditions get better or worsen. The cost of in-home senior care will fluctuate depending on these needs, so let’s jump in and take a closer look at how to prepare to pay for these services.

So, what is the average cost of in-home senior care? First, let’s take a look at the median cost of in-home care for seniors by the type of care required. We’ve broken these median costs down into daily, weekly, monthly and annual costs. These figures come from Genworth’s 2022 data found here.

The average cost of in-home care for elderly is significant, and it’s a cost that we should all prepare for if we picture ourselves remaining in our home despite increasing needs.

The state you live in will have a significant impact on the amount you will pay for in-home care, as well. While some states, like Louisiana and Alabama, are on the lower end, the average cost of in-home elderly care may cost nearly $2,000 more per month in states like California and Massachusetts. Let’s take a look at the breakdown of the median cost of in-home care by state.

Your geographic location is not the only variable that impacts the average cost of in-home care for seniors. There are numerous different types of in-home care which range from non-medical assistance with everyday tasks, housekeeping and meals, to in-home health care which can assist with monitoring health conditions, administering medications and more. There are also specialized forms of in-home medical care to consider, such as in-home care for dementia or the cost of in-home care for Alzheimer's patients.

The needs of the patient will dictate what type of in-home care is needed. When a senior has arthritis and struggles to get daily tasks done, like preparing meals and washing clothes, the care needed is centered around housework and day-to-day tasks. Conversely, medical care is needed if a senior is recovering from a stroke or managing diabetes. It’s impossible to predict what type of care you might need, so it’s good to know the average cost of in-home dementia care, the average cost of 24-hour in-home care, and the costs associated with other types of in-home care. Let’s take a look at how the different types of care impact the cost.

Cost of Non-Medical In-Home Care

Non-medical in-home care for seniors is care focused on getting tasks completed around the home. Tasks such as paying bills, washing the dishes, walking dogs or mowing the lawn. You might need help getting dressed or bathing, preparing meals or vacuuming. There can be many reasons why a senior needs assistance with these types of tasks. Arthritis is a common obstacle in the way of completing these chores independently. Early signs of dementia or Alzheimer’s can make these household jobs more difficult.

A lack of mobility due to injuries or recovery from surgery are also common reasons to need non-medical in-home care. You can even get help with tasks around the house that are just too strenuous for someone in their 70s or 80s. No matter what the reason for non-medical in-home care, the average cost is about $26 per hour, or $59,488 per year if your care aide is working full time. Depending on the amount of care needed and the frequency, you can be looking at a cost of between $300 and $6,500 per month for non-medical in-home care, according to the Genworth median costs of in-home care in 2022.

Cost of Home Health Care

Home health care is required when a senior needs frequent medical attention while wishing to remain at home. A senior who is recovering from an injury, for instance, may need the occasional visit from a healthcare professional to change wound dressings, or monitor vital signs and the healing progress. You might need more frequent visits from a healthcare aide if you’re recovering from surgery, a stroke or a cardiac event. Seniors going through treatment for cancer and other diagnoses may also need in-home health care. Hiring a medical professional to come into your home can be more expensive than a non-medical care aide, but you also may pay less because you need fewer visits. Home health care can cost from $100 per month to over $6,500 per month, depending on the level and frequency of care required. You can expect to pay an average of $27 per hour.

Cost of Part-Time In-Home Care

Many seniors who benefit from in-home care don’t need ‘round-the-clock attention. You may need someone to visit once per week to help clean the house and do some laundry. Your medical needs may only require a checkup every few days. Part-time care is a fitting solution for those seniors who need just a little assistance with household tasks or medical conditions. Looking at the median costs of in-home care as compiled by Genworth, at 7 days of care per month, you could pay approximately $1,456 per month for non-medical in-home care. For 7 days per month of health care in-home assistance, you could pay around $1,512 per month.

If a senior requires care every couple of days, that could amount to around 15 hours per week which can cost $1,560 per month for non-medical care and $1,620 per month for a health care aide. Double these amounts for 30 hours per week.

Cost of 24 HR In-Home Care

The cost of 24-hour in-home care is expensive and there is no way around that. It requires at least 3 care workers rotating 8-hour shifts each day. There is no other way to look at it, the cost of 24-hour in-home nursing care is financially burdensome. However, some seniors require constant care and aren’t quite ready for a nursing home. Driving the cost of 24/7 in-home care up, aides will need to be present to monitor crucial medical conditions, prevent bed sores, and help their subject relieve themselves at all hours. Some 24/7 care requires someone to be alert and awake while supervising the patient at all times, while other situations can call for a live-in aide or an aide who can sleep close by. In any of these scenarios, you can expect to pay around $17,000 or more per month for in-home care.

Cost of Companion or Specialized In-Home Care

There are many other specialized types of in-home health care. Companion care services provide companionship for seniors who don’t need much help with anything else. They are relatively independent and able to take care of themselves, but they may need company to talk with, play games with, watch movies with and just provide general companionship. Companion care can cost around the same as non-medical in-home care at around $26 per hour.

Patients who have been diagnosed with dementia may need specialized in-home dementia care. There are also services that offer specialized care for arthritis, congestive heart failure, Huntington’s disease, high blood pressure, diabetes and more. The costs of these different types of specialized care will vary depending on the variety as well as your location and the frequency of care needed, but generally speaking, these services costs are similar to in-home health care at around $27 per hour.

You may save money by hiring private care providers as costs for such care aides can be approximately 20-30% lower than those same services from providers employed by agencies. However, agencies insure their staff and will often have replacement aides available in the event of illness or any other reasons why your aide may not be able to come to work. You will also have the opportunity to change care aides with a simple request to the agency, should you find that things with your current aide are not quite working the way you expected. You will be the person responsible for paying for your care aide, if you opt for a private caregiver, which means tax considerations and contracts are your responsibility. Further, you can be held liable in some cases if your care aide has an injury on the job. There are definite upsides to working with a private caregiver, but there is security and flexibility with an agency.

Are in-home care expenses tax-deductible? Yes, some in-home care may qualify for certain tax deductions. There are a couple of caveats, however. First, you’re only going to be able to deduct expenses that exceed your adjusted gross income by 7.5%. The other catch is that only in-home medical care can be deducted. In order to ensure you’re eligible for these deductions, you’ll have to itemize the expenses on your tax return. To find out how best to maximize any deductions you may be eligible for, we recommend speaking with an accountant.

Does Medicare cover in-home senior care? The only circumstance under which in-home care is covered by Medicare is when it is in-home health care that is part of a care plan that your doctor sees as necessary. Non-medical in-home care is not covered by Medicare, nor is companion care.

In order to qualify for your in-home care to be covered, you must be enrolled in Original Medicare or Medicare Part A and Part B. You also have to be homebound while undergoing a plan certified by your doctor as necessary. You will have had to have met with your doctor face to face regarding the reason for your in-home health care and you have to choose a caregiver from a Medicare-approved health care agency.

The best way to ensure you can pay for in-home care in the event you require these services sometime in the future, is to plan ahead. There are many ways to do this, from saving money each month in a savings account, to looking at financing or obtaining coverage with insurance. Let’s take a look at the various options that exist that can potentially help with some of the costs of in-home care.

Long-Term Care Insurance

By far one of the best and smartest ways to ensure you can cover the costs of in-home care is to purchase long-term care insurance. In-home care is precisely what long-term care insurance was designed to cover, along with assisted living, nursing homes and other forms of long-term care. The benefits can pay for the costs incurred by any in-home care you require. Long-term care is typically not covered by other types of insurance policies, so purchasing long-term care insurance is often the only way to be able to get coverage for such expenses. Long-term care insurance protects your savings and retirement income as well as your estate. You won’t have to go through your health insurance provider to get coverage for in-home care, and you won’t have to worry about how much your health care insurance provider might cover. This type of insurance is set up specifically for long-term care including in-home care and is the only way to truly ensure you can cover some or most of the costs without dipping into your savings, investments or income. As an added benefit, in some states, you may be able to claim some of your long-term care premiums as medical expenses making them eligible for tax deductions. You may not be able to purchase long-term care insurance once you already need care. Long-term care insurance is most affordable before you hit your 65th birthday. This is a long time before most people need the benefits of long-term care insurance, so it’s a good idea to buy your policy ahead of time.

Out of Pocket

Paying for in-home care out-of-pocket can be an option for some of us. You can pay out-of-pocket for in-home care several ways. You may have enough retirement income to cover these costs. You may also have investments that can be cashed in and used for this purpose. Family may be able to help out or you can sell your home and other properties. Savings are also an option for paying for in-home care. However, you may not want to be dipping into your estate for all of these costs, so planning ahead using long-term care insurance or some of the following options starting now can save your assets and investments.

Reverse Mortgage Loans

Reverse mortgages are a great way to convert the value in your home into cash, but they come with downsides, as well. You can receive the funds from a reverse mortgage monthly, like you would other forms of income, or you can choose a lump sum. As this is a loan based on the value of your home, it is yours to do with as you please. As such, you can use money obtained through a reverse mortgage loan to pay for your in-home care services. However, a reverse mortgage has a negative effect on the equity you have built up in your home, and they require the sale of the property for repayment. That means you may have less to leave to loved ones. It’s important to consult a financial adviser or an accountant before embarking on a reverse mortgage application.

Insurance

Some insurance providers may cover some of the costs associated with in-home care or other forms of long-term care. Many Medicare Advantage plans and private health care insurance plans have some level of coverage for in-home care. To find out if your insurance covers such expenses, take a look at your policy or call your provider.

Life Insurance

Some life insurance policies have a long-term care rider that will assist policyholders with costs associated with any form of long-term care that is required, including in-home care. You may also be able to surrender your life insurance policy in exchange for a lump sum, which is much less than the death benefit. Selling your life insurance policy is an option, as well, in return for a sum of cash which is, again, less than the death benefit but it could be enough to help with the costs of in-home care. Before you do, though, it’s important to understand that selling your life insurance policy means the death benefit no longer pays out to your chosen beneficiary.

Hybrid Policies 

Hybrid policies combine the features of both life insurance and long-term care insurance. You’ll get the peace of mind of knowing that any long-term care you might need, including in-home care, will be covered, while also ensuring you’re taking care of your loved ones with a death benefit. 

Financial Assistance

We know that Original Medicare may pay for some in-home medical costs but it won’t cover non-medical in-home care expenses. Medicaid, on the other hand, can cover these costs whether they are medical or non-medical in-home care services. Whether or not you are eligible for this assistance is dependent on where you live, as each state has different rules and eligibility requirements. You will also have to meet strict income requirements to qualify. It can be beneficial to reach out to your local Medicaid office and find out if you qualify.

The Aid and Attendance benefit for veterans is also a possibility for financial assistance with in-home care costs. Veterans may also have access to Home Maker Health Aide Care benefits and the Program of Comprehensive Assistance for Family Caregivers. The qualifications vary for each of these programs, so it helps to connect with Veterans Affairs to discuss your eligibility.

LIHEAP is a program that assists seniors with energy bills which can make the expenses associated with in-home care a little bit easier to cover.

There are also numerous nonprofit organizations that offer assistance with the costs of in-home care for seniors, especially if the patient has been diagnosed with specific conditions such as Alzheimer’s, cancer or diabetes. It may be worth your time to look at organizations in your state and reach out.

Veteran’s Benefits 

Eligible veterans can have the cost of in-home care for themselves or their surviving spouses who require it. The Department of Veterans Affairs (VA) offers this coverage through a program called the Veterans Affairs Aid and Attendance (A&A) Pension. You must have served 90 days of active duty with one day or more during active war, and you will also have to meet financial qualifications. 

This program covers in-home care as well as other types of long-term care including assisted living, adult day care, and nursing homes. 

How does in-home care compare to alternatives? Let’s take a look.

1. Assisted living facilities - assisted living facilities are residential options designed for those who need assistance with daily activities. The average cost of an assisted living facility in the United States is $4,500 per month, according to the Genworth Cost of Care Survey. This can vary depending on your state, the amount of care you need and the facility you have chosen.
2. Adult daycare facilities - Adult daycare facilities are outpatient programs that provide care for adults who need some assistance with their day-to-day activities. You may be able to receive meals there as well as join in on some social activities and other opportunities. The average cost for adult day care is between $500 - $3,000 per month depending on your need and geographical location.
3. Nursing homes - nursing homes are medical facilities for those who need constant care and have significant medical needs. These types of facilities have round the clock care and medically trained staff so they can monitor residents and provide aid when needed. A nursing home can cost around $9,000 per month for a private room.

Of course, the cost of these alternatives is not the only factor to consider when deciding which is right for you. Many of these options are only right when you have specific needs.

In-home care is not right for everyone. For instance, seniors who need round the clock care and may not be able to afford a rotating shift of caregivers might choose an alternative. If you would prefer to be in a medical facility for increased safety and access to healthcare, you might choose a nursing home or assisted living. However, for those who wish to maintain their independence to some degree while remaining in their own home, in-home care may be the answer. As your needs increase, this could change but deciding whether or not in-home care is right for you will depend on your specific circumstances.

Here are some steps to take that can help you decide:

1. Do you have the means to pay for in-home care?
2. Do you want to maintain some independence?
3. Do you want to remain in your own home while receiving the care you need?
4. Will your care needs be met by in-home care?

Discuss the options with your loved ones, weight the pros and cons and assess your ability to pay the costs. Eventually, your answer will emerge.

The right caregiver for a senior who needs assistance, whether medical or personal, is someone who is going to improve the quality of life of their patient. It’s important to feel comfortable with your caregiver, so meeting with them and learning a little bit about them is a great idea. The right fit will depend on the patient’s specific needs and the skills and experience of the caregiver. If you want to save some money on the costs of in-home care, you may choose a private caregiver, but if you’d prefer security, flexibility and ease, you might choose to work with an agency.

To ensure you’re making the right choice, ask to see your caregiver’s credentials and experience. You may also take into consideration any special skills they might have that fit with your unique needs. Consider, as well, how physically capable they appear. If you choose a private caregiver, consider doing a background check. Discuss the schedule with them to ensure it works for both of you and consider specialized care if you need assistance with specific conditions.

Finding the right caregiver is important, so take the time to make sure you’ve found the right fit.

Our content is created for educational purposes only. This material is not intended to provide, and should not be relied on for tax, legal, or investment advice. Everdays encourages individuals to seek advice from their own investment or tax advisor or legal counsel.