It is no secret that long-term care is among the greatest financial risks we will face as we age. But if you are a woman, your chances of needing significant levels of personal care after age 65 are especially high. So are the dangers of not planning for costs that will average more than $180,000 for a woman turning 65 today.
On average, according to my Urban Institute colleague Melissa Favreault and Judith Dey of the Department of Health & Human Services, about half of all Americans will need a high level of long-term supports and services at some time before they die. In other words, the chances that you’ll need extensive paid assistance in old age are about 50/50. But if you are a woman, they are nearly 6 in 10. Take a look at this chart:
Not only are women more likely to need this care in old age, but they probably will need it for more time. While a typical man will need a high level of support for about 1.5 years, a woman will need it for 2.5 years. And while about 10 percent of men will need high levels of personal care for five years or more, almost twice as many women will need care for that long.
It is the same story when it comes to using care (as opposed to needing it). Women are likely to use paid care for twice as long as men—about 16 months vs. about 8 months. Keep in mind that this care can take place at home, in a nursing facility, or in residential care such as assisted living.
Add all this up, and it is no surprise that the total cost of care for women over 65 far exceeds costs for men. Total projected spending on high levels of paid care for women over 65 will top $182,000 (in 2015 dollars). That’s twice as high as for men. On average, consumers and their families can expect to pay half those costs out of pocket. Medicaid, insurance and other payers will cover the rest.
Keep in mind that this study looked only at those who have a severe need for personal assistance and other services. This means help with at least two daily activities such as bathing, eating, or dressing; or having severe dementia or other cognitive impairment. About 70 percent of those 65 and older will need a lower level of assistance, often for many years.
Why will women need paid care for so much longer than men? In part, it’s because they’ll live longer. On average, a women turning 65 today can expect to live another 21.6 years, more than two years longer than men. It also may be the nature of disease. For instance, since women live longer, they may have a higher incidence of conditions such as dementia. But it may also be because wives are more likely to provide unpaid care to frail husbands.
We still have a lot to learn about the “whys,” but there is little doubt that women are more likely to need long-term care than men, they will need it for a longer period of time, and their care will cost much more. Maybe you’ll be one of the 42 percent of women who won’t need this high level of care at all. But you probably won’t beat the odds. And women who ignore that reality do so at their peril.