JCHS housing report cover

Only 13% of adults aged 75 or more years who are living alone across 97 US metro areas can afford to move into an assisted living community without starting to cash in their assets, according to “Housing America’s Older Adults 2023,” a new report from the Harvard Joint Center for Housing Studies, released Thursday. The calculation considers costs for both long-term care services and supports and housing.

The report authors said that challenges associated with the cost of housing and LTSS will compound in the next decade as the population of adults aged more than 75 years increases exponentially. The cost of long-term care services averages more than $100 per day now, they said.

Citing data from the National Investment Center for Seniors Housing & Care, the JCHS paper stated that 762,000 assisted living units nationwide are home to approximately 623,000 older adults. The median annual cost of assisted living is $63,000, although regional variabilities can put costs anywhere between $43,000 and $98,000. NIC provided principal funding for the report.

Given that subsidies for housing and LTSS reach only a fraction of eligible households with very low incomes, some organizations have found ways to reduce assisted living costs, the authors said. The report pointed to some of those alternatives, including repurposing properties, using philanthropic resources, unbundling services to offer lower-cost options tailored to individuals needs, and partnering with third-party providers to offer transportation, wellness and other services.

Technology also is emerging in assisted living to provide access to healthcare through telehealth and medication reminders, as well as safety features such as those for falls detection and prevention.

During a virtual panel discussion on the report hosted by JCHS on Thursday, several housing and aging experts touched on the growing demand for alternative housing options that include healthcare to address the growing needs of an aging population.

Panelists pointed to the gap between assisted living and public support. The report analyzed households led by adults aged 75 or more years that were unlikely to receive public subsidies but also had insufficient incomes to afford assisted living. Those gap households, on average, could only afford 62% of assisted living costs.

“The combined cost of housing and daily care is beyond the means of most people, including middle-income individuals,” said Jennifer Molinsky, project director of the Harvard JCHS Housing an Aging Society Program.

Bob Kramer, NIC co-founder and current strategic adviser to the organization, said that the increasing population of middle-income older adults who don’t have the resources to afford housing and care options was unknown to many until the NIC-funded “Forgotten Middle” study was published in 2019 in partnership with NORC at the University of Chicago.

That study, published by Health Affairs, projected that 54% of the 14.4 million middle-income older adults in 2029 in the United States will lack the financial resources to pay for senior housing and care, and a combination of public and private efforts will be needed to address the looming crisis.

“The challenge is getting the long-term care services you need, together with safe and secure housing, is unaffordable to many — not just low-income individuals,” Kramer said, adding that the solution is to innovate and scale. “Options going forward cannot be pitted against each other. We need everything. We need more options for people to choose and afford where they want to live.”

Meghan Rose, LeadingAge California’s general counsel and chief government affairs officer, said that there is “no one solution to ending the housing crisis.” Older adults, she added, deserve options, whether that means aging in place or assisted living or another option. Among the options the panel mentioned were multigenerational housing and co-housing efforts that bring together various generations to act as a supportive community. 

Within senior living, Kramer said, some operators have moved to or are considering using a universal worker approach adopting technology and are encouraging residents to volunteer in various ways to help reduce the costs that communities need to charge. 

“The combination of housing and care is really expensive, and we need innovation and scale, and we need to collaborate on solutions,” he said. 

First published in 2014, the report has been updated several times. This year, JCHS committed to releasing a report every two years. The latest report, available online, also includes data and interactive maps.