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Genworth’s 2021 Cost of Care Survey: Long-Term Care Costs Increase Due to Labor Market Shifts and Costs Associated with Continued COVID-19 Response

The cost of long-term care services increased across all provider types in 2021 and increased more substantially for certain settings, according to Genworth’s 18th annual Cost of Care Survey. The most substantial increases occurred in home health aide and homemaker services costs. The core driver of increases in the costs of care services remains the relationship between the supply of professional labor and the immense—and growing—demand of an aging society. While variances exist across the country and between urban and rural areas, wages are rising for care professionals, through legislative measures in some regions and because of competition for workers across industries. COVID-19 is also a contributing factor to cost increases, given increased usage of personal protective equipment (PPE), enhanced safety training, and additional management of regulatory compliance; however, those costs are expected to dissipate over time.

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Even as costs rise, research indicates that home-based care remains the preferred choice for families1. Engaging home care professionals, who can monitor and facilitate safe and healthy behaviors, may increase the chances that an aging individual can stay at home.

To explore median Cost of Care data by city, state or ZIP Code, to find charts showing trends since 2004, and to access lists of states ranked in order of care costs, visit www.genworth.com/costofcare.

The 2021 survey reports that the cost of care services has increased as follows:

  • Assisted living facility rates increased by 4.65% to an annual national median cost of $54,000 per year.
  • The cost of a home health aide, which includes “hands-on” personal assistance with activities such as bathing, dressing, and eating, has increased 12.5% to an annual median cost of $61,776.2 Homemaker services, which include assistance with “hands-off” tasks such as cooking, cleaning, and running errands, have increased 10.64% to an annual median cost of $59,4882.
  • The national annual median cost of a semi-private room in a skilled nursing facility rose to $94,900, an increase of 1.96%, while the cost of a private room in a nursing home increased 2.41% to $108,405.

While price increases compared to last year, especially for home-based services, are significant, over the last five years, the average annual increase for these services has been in the 2% to 6% range.

“The Cost of Care Survey has once again underscored the importance of planning ahead for long-term care costs and highlighted the need to consider where and how a person wants to receive care,” said Brian Haendiges, President and CEO, Genworth U.S. Life Insurance. “Further, our Beyond Dollars research shows that having a long-term care plan can help alleviate some of the emotional, financial, and physical stress of finding care for a loved one. Genworth is working to provide people with the products, services, and solutions to help navigate the challenges of aging—and our annual Cost of Care Survey and the accompanying interactive website are incredibly useful tools to help families assess care options as well as the costs associated with those options. It is a great first step to making a plan in advance of when you will need it.”

Why Costs Are on the Rise

Since Genworth started tracking the cost of care in 2004, the cost for long-term care services has been on the rise, driven by supply and demand. Every day until 2030, 10,000 Baby Boomers will turn 654 and seven out of ten of them will require long-term care services and support at some point5. The level of care needed by this rapidly aging population has itself increased over the years6. The high turnover rate and insufficient supply of professionals to meet this growing demand pre-date the COVID-19 pandemic7, but are now amplified as those providing care on the frontline must consider their own risk of exposure against increasing opportunities for competitive salaries, training, and advancement in alternative lines of work.

“Even more than in prior years, the increased demand for labor and the current national labor shortage have made it more difficult to hire and retain long-term care professionals,” said Haendiges. “Those challenges are coupled with the broader trend of growing wages and increases in the cost of doing business associated with regulatory, employee certification, and equipment costs, which have all been exacerbated by the pandemic.”

“There is fierce competition for a limited number of care professionals, and many are leaving the industry in pursuit of higher paying jobs or because of concerns about potential exposure to COVID-19 while on the job. The costs of recruiting, retaining, and training new care professionals is likely to remain high as we approach 2023,” Haendiges said.

While labor costs are likely to remain high, conversations with care services providers indicate that elevated costs associated with PPE and other COVID-19 protocols such as testing, vaccination status tracking, and quarantining may subside as we make continued progress on reducing COVID-19 case numbers. However, it is likely that wide variability in care costs for markets across the U.S. will continue due to state and local regulations, demographics, and population shifts.

Elevating the Value Proposition for Home Care

In a conversation with Jeff Huber, President of Honor Technology and Chief Executive Officer of its subsidiary Home Instead, Inc., which is the leading global provider of home care services for older adults, Huber acknowledged that while labor costs have been a key driver of home care cost increases, the same trend has led to an elevation of the home care profession and helped demonstrate the integral role care professionals play in supporting capacity across the healthcare ecosystem. Huber says that higher wages are bringing compensation in the industry more in line with where it should be, given the demands of the job and the significant value that care professionals provide to care recipients and their loved ones.

“The pandemic has shown us that home is the safest place to care for people,” said Huber. “As our population ages and more people require long-term care, it is clear that the most scalable, comfortable, and safest solution is home-based care.” Huber added that care professionals can help their clients adhere to a medication regime, combat loneliness, stay better nourished and hydrated, and provide social and mental engagement, leading to better health outcomes. “We are working to enhance the perception of professional caregiving and elevate it as a vocation of the future, with increased training and education standards to ensure consistency and accountability across the industry.”

While costs have risen, Huber stressed how organizations like his are leveraging technology platforms and centralized administrative teams to reduce costs associated with scheduling, coordination, billing, payroll, recruiting, and training. “We’re implementing ways to really streamline operations so we can be as efficient as possible to provide as much value to the client as possible for the right price point,” he says.

Caring for people in their homes frees up capacity in hospitals, reducing admissions and readmissions, as well as overall usage of healthcare infrastructure. Better incorporating home care into the broader healthcare ecosystem, especially when arranging for some level of home care at the earliest signs of a loved one’s need, is likely to help reduce overall costs and support better patient outcomes.

Genworth’s Cost of Care Planning Resources

Genworth is committed to helping people learn about, understand the challenges of, and appropriately plan for the cost of long-term care services. The following are resources that can help with the planning process:

About Genworth’s 18th Annual Cost of Care Survey

Genworth’s annual Cost of Care Survey, one of the most comprehensive studies of its kind, contacted more than 67,000 long term care providers nationwide to complete almost 15,000 surveys for nursing homes, assisted living facilities, adult day health facilities and home care providers from June to November 2021. The survey includes 437 regions based on the Metropolitan Statistical Areas, defined by the Office of Management and Budget as a core area containing a substantial population nucleus, together with adjacent communities having a high degree of economic and social integration with that core. However, due to statistical variance actual costs for long-term care services may differ from the projected cost based on ZIP Code or location. CareScout®, part of the Genworth Financial family of companies, has conducted the survey since 2004. Located in Waltham, Massachusetts, CareScout has specialized in helping families find long term care providers nationwide since 1997.

About Genworth Financial

Genworth Financial, Inc. (NYSE: GNW) is a Fortune 500 provider of products, services and solutions that help families address the financial challenges of aging. Headquartered in Richmond, Virginia, we apply our nearly 150 years of experience each day to helping people navigate caregiving options and fund their long term care needs. Genworth is also the parent company of publicly traded Enact Holdings, Inc. (Nasdaq: ACT), a leading U.S. mortgage insurance provider. For more information on Genworth, please visit https://www.genworth.com/. From time to time Enact separately releases financial and other information about its operations. This information can be found at https://ir.enactmi.com/.


1 Genworth Beyond Dollars 2021 (https://pro.genworth.com/riiproweb/productinfo/pdf/682801BRO.pdf), site accessed 1/25/22.

2 Based on 44 hours per week for 52 weeks.

3 Based on 44 hours per week for 52 weeks

4 ”2020 Census Will Help Policymakers Prepare for the Incoming Wave of Aging Boomers” (https://www.census.gov/library/stories/2019/12/by-2030-all-baby-boomers-will-be-age-65-or-older.html), site accessed 1/25/22.

5 2021 U.S. Department of Health and Human Services (https://acl.gov/ltc/basic-needs/how-much-care-will-you-need), site accessed 1/25/22.

6 Genworth Beyond Dollars 2021 (https://pro.genworth.com/riiproweb/productinfo/pdf/682801BRO.pdf), site accessed 1/25/22.

7 2020 “The Ballooning Costs of Long Term Care,” American Action Forum, (https://www.americanactionforum.org/research/the-ballooning-costs-of-long-term-care/), site accessed 1/25/22.

Genworth releases 2021 Cost of Care Survey

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