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Associated Press, Published May 01 2009

Nursing home costs lower in ND, but on the rise everywhere

NEW YORK – The price tag for nursing homes, in-home care and assisted living is lower in North Dakota than in most other states, but costs here and everywhere are on the rise, adding another potential hardship to retirees already struggling amid the recession.

According to a new survey by Richmond, Va.-based insurer Genworth Financial Inc., the average annual cost for a private room in a nursing home is $74,208, or $208 per day – a 4.7 percent boost over the past year and 4.3 percent annually over the past five years.

The costs range from $49,153 in Idaho to $125,925 in Connecticut, the highest in the continental U.S. Overall, the Northeast is the most expensive region of the nation for nursing homes.

In North Dakota, the annual average cost for a private nursing home room is $58,548. The cost is $76,573 annually in Minnesota and $65,974 in South Dakota.

The survey says that except for home-based health care, the costs of long-term care are also poised for steady increases. The cost of labor is a key factor driving the price of care at facilities, though that has abated somewhat because of the availability of workers as unemployment has risen and higher retention rates.

“The labor required in a facility is generally more skilled in nature,’’ said Beth Ludden, senior vice president of long-term care product development at Genworth.

North Dakota had the lowest annual cost, at $25,049, when looking at the cost for a one-bedroom unit in an assisted-living facility, according to the survey.

Massachusetts was the highest in the continental U.S., at $55,137. In Minnesota, the annual average cost is $31,656. In South Dakota, it’s $29,390.

The average cost nationwide is $33,903 annually, or $2,825 monthly, marking an increase of 1.4 percent over 2008 and 4.7 percent annually over the past five years.

The recession highlights the expense of long-term care, Ludden said, with many people having counted on assets such as their homes to help pay for the costs. Many of those assets are now worth less for many people. The median sale price for a house fell 12 percent in March, according to a recent Commerce Department report.

“Historically, people have thought they would have an asset to liquidate to pay for it, but those assets may now be devalued,” she said.

A bright spot in the company’s survey is the relatively flat cost of in-home care. The hourly cost for in-home care for non-Medicare certified workers rose a half-percent to $18.50 from a year ago and grew 1.7 percent annually over the past five years. Louisiana was the least expensive annually, while Massachusetts topped the list.

More than two-thirds of the over-65 population will eventually need some form of long-term care, Ludden said

Genworth’s most recent study expanded its scope to 331 regions, from 90 a year earlier, also prompting it to change how it calculates costs, using the average of the regions’ median costs. The company also assessed which states had the most nursing home choices and affordability, placing Iowa, South Dakota and Kansas at the top of the list.

Genworth’s 2009 Cost of Care Survey is available on the company’s Web site, www.genworth.com.