Insurance Study on Long-Term Care, Nursing Homes, and Assisted Living

Insurance Study on Long-Term Care, Nursing Homes, and Assisted Living

Insurance Study on Long-Term Care, Nursing Homes, and Assisted Living

The National Study of Long-Term Care Providers, which was conducted by the Centers for Disease Control and Prevention’s National Center for Health Statistics (NCHS), recently released a report with industry data on home health agencies, hospices, adult day services, assisted living facilities and nursing homes. This information is useful when looking at the segment from an insurance perspective in terms of the opportunities available to tap into this expanding niche. We thought we’d provide you with some data highlights.

The number of people using nursing facilities, alternative residential care places, or home care services is projected to increase from 15 million in 2000 to 27 million in 2050. Most of this increase is as a result of a significant rise in the older adult population who will need such services. Recent projections estimate that over two-thirds of individuals who reach age 65 will need long-term care services during their lifetime. Largely due to aging baby boomers, the population is expected to become much older, with the number of Americans over age 65 projected to more than double, from 40.2 million in 2010 to 88.5 million in 2050. The estimated increase in the number of the “oldest old”—those aged 85 and over—is even more striking. The oldest old are projected to almost triple, from 6.3 million in 2015 to 17.9 million in 2050, accounting for 4.5% of the total population, according to a U.S. Census Bureau report in 2012.

Furthermore, according to the NCHS study, the long-term care services delivery system in the United States has changed substantially over the last 30 years. For example, although nursing homes are still a major provider of long-term care services, there is growing use of skilled nursing facilities for short-term, post-acute care and rehabilitation. Consumers’ desire to stay in their own homes, and federal and state policy developments have led to growth in a variety of home- and community-based alternatives. The major sectors of paid, long-term care services providers now also include adult day services centers, assisted living and similar residential care communities, home health agencies, and hospices.

In 2012, there were about 58,500 paid, regulated long-term care services providers serving about 8 million people in the United States. Long-term care services were provided by 4,800 adult day services centers, 12,200 home health agencies, 3,700 hospices, 15,700 nursing homes, and 22,200 assisted living and similar residential care communities. Each day in 2012, there were 273,200 participants enrolled in adult day services centers, 1,383,700 residents in nursing homes, and 713,300 residents in residential care communities; in 2011, about 4,742,500 patients received services from home health agencies, and 1,244,500 patients received services from hospices.

The majority of providers in four of the five sectors were for profit, whereas the majority of adult day services centers were nonprofit. The average size of a provider, based on the number of people served, varied by sector. On average, a nursing home served more than twice as many people daily as an adult day services center or residential care community. On an annual basis, a home health agency served more patients on average than a hospice. The supply of nursing home and residential care beds and the capacity of adult day services centers varied by region, which suggests geographic differences in access for consumers of long-term care services. For example, the supply of residential care beds was higher in the Midwest and West than in the Northeast and the South, and the capacity of adult day services centers was higher in the West than in the South. Provider sectors differed in their nursing staffing levels, use of social workers, and variety of services offered.

In examining the nursing staff, the average daily staff hours per resident or participant day was higher in nursing homes than in residential care communities and adult day services centers. This difference, according to the report, may reflect the higher functional needs of nursing home residents when compared to service users in other sectors. Sectors varied in their use of social workers, ranging from most hospices employing at least one social worker, to just over one-tenth of residential care communities doing so. In terms of services offered, more hospices and nursing homes offered mental health and counseling services compared with adult day services centers and residential care communities.

The study also cited Alzheimer’s disease or other dementias as being the most prevalent among nursing home residents (48.5%), and the least prevalent among home health patients (30.1%). The percentage of users of long-term care services with a diagnosis of depression was highest in nursing homes (48.5%), and lowest in residential care communities (24.8%), adult day services centers (23.5%), and hospices (22.2%).

Caitlin-Morgan provides specialized, comprehension insurance programs, including General Liability Professional Liability, Property, Workers Compensation and a number of other key coverages, for nursing home & assisted living facilities. Please give us a call at 877.226.1027 to discuss how we can help you insure your clients.