When Eileen Kalk’s husband, Tom, 72, was diagnosed with Alzheimer’s disease in 2020, she assumed finding the right long-term care program would be a matter of identifying the best facility. Instead, the semi-retired physician assistant living in Lakeport, California, discovered that affordability — not availability — would become one of her family’s biggest challenges.
After years of caring for aging parents, Eileen, 70, suddenly found herself navigating the complex and expensive world of long-term care. But like many families, Eileen had to weigh the quality of care against mounting costs and the need to be close enough to visit Tom regularly.
“I looked at home care, but for the number of hours Tom would need with aides, it actually would be more expensive than moving him into long-term care,” says Eileen. She ultimately moved Tom into an older residential memory care community about three and a half years ago, where he continues to receive care as his disease progresses.
Financial reality of long-term care
Eileen Kalk’s experience highlights the difficult financial decisions thousands of caregivers face as they search for quality long-term care options, like nursing homes or memory care units. “The biggest shock isn’t choosing a nursing home — it’s realizing how quickly a lifetime of savings can disappear once long-term care becomes necessary,” says Frank King, assistant teaching professor of health policy and administration at Penn State University.
Eileen Kalk had sticker shock when she started looking at long-term care options for her husband, Tom.
Courtesy Eileen Kalk
The annual cost of a private room in a nursing home is $127,750, a price tag that creates a direct financial burden for many caregivers. Between 2019 and 2024, the cost of long-term care services increased by 23 percent to 48 percent. In contrast, median age 65+ household incomes rose by 22 percent, according to a report by the AARP Public Policy Institute.
Most families pay for long-term care out of pocket. Medicare generally doesn’t cover long-term care, but it may partly cover up to 100 days of nursing care following a qualifying hospital stay if specific medical and doctor’s approval are met.
Medicaid not only provides health coverage for low-income individuals, but it also pays for nursing home care, including room and board. However, applicants must meet strict eligibility and income requirements.
Planning ahead can help. Comparing care options and costs before a crisis can make a meaningful difference. “Assisted living is less expensive than nursing home care, but also, in most states, less closely regulated. Rising prices for both have made affordability a growing challenge as price increases have outpaced Americans’ income growth,” says Alan Weil , senior vice president at the AARP Public Policy Institute.