A new American Advisors Group survey helps put the future of senior living payments in perspective. But not in a good way.
For if the findings from 1,510 respondents are anywhere near accurate, the kids are not alright. That is, if you as an operator had the crazy notion they’d help pay for their parents’ senior living expenses. Or heaven forbid, their own.
How bleak is the outlook? This bleak:
Nearly six-in-10 adults between the ages of 40 and 55 said they will not be able to pay for life in an assisted living community for their aging parents. About three quarters (74%) indicated they would prefer that their parents stay home instead.
Those are the greatest hits. There’s more, including these juicy tidbits:
- 50% of adult children indicated they are not aware of how much debt their parents currently have.
- 55% of adult children indicated they are not financially prepared to care for their parents in a time of need.
Any way you slice it, these are hardly encouraging findings for a senior living field that is built on communal living, and to a lesser extent, some financial help from the kids.
It’s especially troubling as we hear more talk about serving the unmet needs of the middle market.
To be sure, opinions vary on how exactly to define that cohort. But if the average pretax family income in our nation is south of $75,000 a year, it’s probably safe to say monthly payments exceeding $4,000 a month are simply not going to be affordable for many in this “middle.” Are you ready to offer all-in rates anywhere near that?
The only realistic solution here is going to be subsidies from the government. In other words, what Medicaid is doing now, but on a much grander scale. That is, assuming more means-tested funding actually will be made available, which is hardly a sure thing.
You don’t need to be a mathematician to see where this progression leads: a two-tiered system. One for the haves, one for the have-nots. Frankly, the real question for many operators will likely be which side to choose.
John O’Connor is editorial director for McKnight’s Senior Living and its sister media brands, McKnight’s Long-Term Care News, which focuses on skilled nursing, and McKnight’s Home Care. Read more of his columns here.