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Costs:
A 2003 MetLife survey showed that the average monthly basic rate for an Assisted Care appartment ranged from $1,340 a month in Miami to $4,327 in Stamford, Conn. A two-bedroom option for residents with dementia costs $6,400 in Conn.
Most facilities also require an up-front fee, which may range from the equivalent of one month's charges to tens of thousands of dollars; it may or may not be partially refundable if a resident leaves.
At the current growth this would ammount to $65-150,000 per year in 2021.

The average rate for a private room in a nursing home is $181 a day, or about $66,000 a year.

If the room rates reflect current annual increases in nursing-home costs, then by 2021, when today's 60-year-olds might need such care, the average rate will have risen to about $480 a day, or $175,200 annually.

Between 2004 and 2008, nursing-home costs are projected to rise by 5.6 percent a year, and 5.9 percent for four years after that, according to the Centers for Medicare & Medicaid Services.

Home-health aides charge $18 an hour, on average. Hiring one for eight hours a day costs $144. A policy with a $181 benefit would only pay a portion of that.

Insurance:
Medicare only pays for 100 days and after 20 days you are responsible for a co-payment (now $105 a day).

A 2003 Consumer Reports investigation, which reviewed 47 policies, revealed that for most people, long-term-care insurance is too risky and too expensive. As with health insurance, you must keep paying to keep it in force. If premiums rise, you may have to drop the coverage, possibly losing everything that you've paid. The policy's benefits may cover only a portion of the total expense. Many policies are packed with catches that can keep you from collecting. Finally, there's no guarantee that long-term-care insurers, some of which have weak balance sheets, will be around 20, 30, or 40 years from now when you need them to pay.

Premiums escalate as you age. For example, a plan that costs a 50-year-old $1,625 annually will run a 60-year-old $3,100 and a 70-year-old $7,575.

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last updated 19 Nov 2005