Why does a Nursing Home and Assisted Living cost so much money? Most consumers assume they can get a hotel room for less than the cost of a nursing home stay.
There are many reasons the cost of care in a Nursing Home is much higher than one would expect.
One must first understand what a Nursing Home is before they can say, “I can hire someone for $10 an hour to take care of my mother and it will be cheaper than a Nursing Home.”
Nursing Homes are a bridge between a hospital and a private home. In the 1970′ and 1980’s Nursing Home’s were a place for old people to go and spend the last 10 years of their life. Today, Nursing Homes have become like the recovery section of a hospital. Due to the tightening of reimbursement on Hospitals, patients are now discharged after 3 days to a Nursing Home after having major surgery like a hip replacement. The patient then spends anywhere from a few weeks to a few months in the Nursing Home recovering from surgery and getting physical and occupational therapy.
If a hospital charges over $1000 a day, then spending $300 – $400 a day at a Nursing Home is considered a bargain!
But why does it cost $300 a day when a hotel only costs $100 a day?
Healthcare Costs Breakdown
Nurses & Nurses Aides: $150 – $200 a day.It is not just the aide who helps Mom go to the bathroom, there are specialty nurses, wound specialists, regulatory nurses, nurse supervisors, staff recruitment & retention etc.
Food: $20 – $25 a day. This includes a dietician to make sure the food is healthy, kitchen staff, and food itself. The regulations do not allow serving Mac & Cheese everyday.
Utilities: $10 – $20
Housekeepers, Maintenance, Laundry: $20
Building Cost: $15 a day. This is what it costs to build a nursing home. Remember, a nursing home is built like a hospital not like an apartment building. There are special Fire & Safety regulations.
License Fees: $5 – $10 a day (That is correct, the federal government pays for Nursing Home care via Medicare and then the state government charges the Nursing Home licensing fees)
Real Estate Taxes: $5 – $10 a day
Administration Costs: $10 – $20 a day
Medical Supplies: $10 a day
Medicine: No Limit
Physical, Speech & Occupational Therapy: Varies
Now you have a general idea of what goes into the costs of a nursing home.