LTCG’s annual Cost of Care study featured in McKnight’s Senior Living

Assisted living loses ground on pricing amid pandemic costs, lower occupancy

By Kimberly Bonvissuto

The pandemic had a significant effect on older adult care recipients and providers, with assisted living operators reversing a five-year growth trend in pricing, according to the results of a new report.

The LTCG 2020 Cost of Care report and analysis, released Tuesday, found that senior living and care facilities battled higher costs amid lower occupancy. The shift in claims in 2020 from facilities to home-based care was notable, according to the report.

According to the report, overall, assisted living reversed a five-year growth trend in pricing. From 2019 to 2020, costs for an assisted living studio apartment fell 1.7%, a one-bedroom apartment fell 1.6%, and a two-bedroom apartment fell 0.4%.

Annual rates for assisted living care average from $49,991 for a studio unit to as much as $62,725 for a two-bedroom unit. Assisted living operators nationwide in 2020 charged average monthly prices ranging from $4,162 for a studio apartment (compared with $4,241 in 2019) to $5,224 for a two-bedroom unit (compared with $5,248 in 2019), with pricing varying greatly based on location.

The most expensive states for assisted living care were New Jersey, Maine, Delaware, Massachusetts and Maryland, with prices for a one-bedroom apartment ranging from $7,979 to $6,208 per month — compared with a national average monthly rate of $4,800.

In contrast, states with the lowest average monthly rate for a one-bedroom assisted living unit were Mississippi, North Dakota, Louisiana, Alabama and Wyoming, where rates ranged from $3,519 to $3,864 per month.

For a studio apartment in assisted living, the most expensive state, based on average charge, was Delaware, at $6,793 per month or $81,516 per year. The least expensive state was Mississippi, at $2,984 per month or $35,808 per year. The national average was $4,165 per month, or $49,991 annually.

For a two bedroom unit in assisted living, the most expensive state based on average charge was New Jersey at $8,700 per month or $104,400 per year. The least expensive state was North Dakota, at $3,743 per month or $44,916 per year. The national average of $5,227 per month or $62,725 per year.

The study includes long-term-care cost information for home health aides, assisted living communities and skilled nursing facilities for states and metropolitan areas across the country. Data can be sorted by type of care and geography.

The study gathers data points from senior living and care providers nationwide for insurers and financial providers, who use the data for forecasting and stakeholder education, as well as for providing information about national and regional cost variations.

This article was originally published in McKnight’s Senior Living