Study finds confusion about long-term care's costs - NH News Notes - Brief Article - Statistical Data Included

Nursing Homes, Feb, 2002 by Douglas J. Edwards

A recent study by the AARP found that while 60% of Americans age 45 and above said they were "somewhat familiar" with long-term care, they were grossly unknowledgeable about the costs of the industry's services.

When asked to estimate the monthly cost of nursing homes, only 15% of respondents came within [ or -]20% of the national average cost ($4,654); 24% didn't wager a guess. Knowledge of assisted living's monthly costs was a little better: 27% came within [ or -]20% of the estimated median cost range ($2,000 to 2,500), and 38% said they "don't know." The report found a wide disparity in the perceived costs for in-home aide and nurse care, as well.

About three in ten respondents said they had insurance for long-term care expenses, which contrasts with a Health Insurance Association of America finding that only 6% of Americans had such a policy before 1998. Discounting the possibility that enough Americans purchased long-term care insurance since then to make up for the difference, researchers concluded that many Americans think they have such coverage when, in fact, they do not. This might lead to a false sense of preparedness: 70% of respondents who believed they have this insurance felt financially prepared to pay for long-term care.

The study also uncovered confusion about government assistance for long-term care. Fifty-five percent erroneously believed Medicare covers long-term nursing home stays, and 41% believed Medicare covers assisted living (34% weren't sure).

AARP CEO Bill Novelli said in a release that the AARP will use this information to educate the public about the true costs of long-term care for individuals and their families.

RoperASW gathered the survey data through telephone interviews of a random sample of 1,800 Americans age 45 and above; to gather state-level data, phone interviews were conducted with a random sample of 400 people age 45 and above in California, Florida, New Mexico, Washington and Wisconsin.