Considering your Long-term Care Options
5 Nursing Home Alternatives
November is National Long-term Care Awareness Month — and a good time to start thinking about future healthcare for yourself or a loved one.
Over the years, healthcare options for older adults have evolved. Although many nursing homes offer exceptional services, many people bristle at the thought of living in one, because of the high costs involved—the average annual cost for a private room in the U.S. is currently $92,376—and concerns about living in an institutional environment, rather than independently. Consequently, many are choosing assisted living or other alternatives that allow them to stay at home and receive assistance with daily living activities, such as housework, shopping and transportation, as well as their medical needs.
With healthcare costs a huge factor, it’s important to gauge your potential expenses, and then explore the possibilities to find the best fit for you and your family.
Assisted living. In an assisted living residence, the level of care varies from independent living to nursing home-level assistance. Many also offer specialized memory care divisions for people with Alzheimer's or dementia. Residents live in private or shared apartments, and receive personal care support, medication reminders, and 24-hour on-call aid. They typically enjoy group dining, day trips, and leisure activities like games and movie nights. While cost varies by state, monthly fees can range from $2,500 to $5,000.
Home health aide. A professional home health aide can come to your home each day to check vitals and help with administering medications and activities of daily living, such as bathing or eating. Providers are paid an average of $4,195 a month for the benefit of receiving quality care in the comfort of one’s own home.
Adult foster care. Compared to the more hospital-like nursing home setting, adult foster care offers family-oriented living in someone else’s home. While supervision, meals and assistance with medications and bathing are provided, medical care is not. Care providers are regulated by their states, and costs range from $1,500 to $3,500 per month.
Adult daycare. The more than 3,500 adult daycare centers currently operating in the U.S. can be a great option for retirees who like to socialize and stay active. Most centers offer meals, exercise, activities and transportation, and some also have services for the memory impaired. For this type of care, you can expect to pay approximately $1,560 a month, depending on location and amenities
Medicare PACE programs. PACE (or Programs of All-Inclusive Care for the Elderly) offer in-home services to Medicare beneficiaries who would otherwise require a nursing home. While these programs don’t cover 24/7 personal supervision, they include medical and some personal care, enabling many retirees to remain at home. Beyond the normal Medicare fees, PACE carries no additional cost, but availability in certain areas may be limited.
The means to age independently
Research shows that a 66-year-old couple retiring this year will use more than half of their Social Security benefits on healthcare costs alone. So, if long-term care plans include you or your family members remaining home, there are options to help free up more funds to stay put.
A reverse mortgage loan can be a great alternative to, or supplement for, long-term care insurance. Available to homeowners and homebuyers age 62 and older, it can give you a new source of funds by t allowing you to borrow against the equity in your home. With a reverse mortgage, you can gain access to funds that you can use today, or a line of credit that will be ready and waiting when you need it.
Another loan option, Equity Elite, is available to homeowners and homebuyers as young as 60, and is designed specifically for higher-value homes as well as condo owners and buyers. Available in certain states, this new loan option offers loan amounts of up to $4 million (depending on home value), as well as no Mortgage Insurance Premium (MIP) fees and an option called Equity Elite Zero† that eliminates nearly all up-front costs.
Both loan options could help you continue living in your own home while getting the care you need, without having to drain your retirement savings.
Because there’s no place like home
At Reverse Mortgage Funding LLC (RMF), our mission is to help meet the financial needs of retirees, so they can remain comfortably at home as they age. Call us today at (888) 277-1567 to set up a convenient phone appointment to learn more about your financing options.
SEE WHAT FUNDS YOU MAY HAVE AVAILABLE
If you have equity in your home and believe you meet the eligibility requirements, a HECM may be the option that could help you retire smart.
Equity Elite Reverse Mortgage (“Equity Elite”) is Reverse Mortgage Funding LLC’s proprietary loan program, and it is not affiliated with the Home Equity Conversion Mortgage (HECM) loan program, which is insured by FHA. Equity Elite is available to qualified borrowers who also may be eligible for HUD, FHA’s HECM program or are seeking loan proceeds that are higher than HUD, FHA’s HECM program limit. Equity Elite currently is available only for eligible properties in select states. Please contact your loan originator to see if it is currently available in your state.
Upon a maturity event, any non-borrowing individuals with an ownership interest in the property, including non-borrowing spouses, will have 90 days to purchase the property from the estate or, if the non-borrower inherits the property, pay the loan in full using any sources of funds available to them. Any non-borrowing individual, including a non-borrowing spouse, should have a plan to pay off an Equity Elite reverse mortgage upon the borrower’s death or any other maturity event. If the non-borrower is unwilling or unable to purchase the property or pay the loan in full, there is no protection for the non-borrower (including a non-borrower spouse) to maintain an interest in the home or to continue residing in the home past the maturity event and the non-borrower may be evicted upon foreclosure. The FHA HECM program has protections in place for certain non-borrowing parties, so a reverse mortgage applicant with certain non-borrowing parties should strongly consider a FHA-insured HECM loan (see HECM guidelines or ask an RMF representative for details). Under the Equity Elite reverse mortgage loan program, a maturity event occurs when the last surviving borrower no longer lives in the home as his or her primary residence for at least 12 months, the property charges (including taxes, insurance, HOA dues or any other property charges) are not paid, required repairs are not completed or the property is not maintained, or any other maturity event, as specified in the Security Instrument, occurs.