Effects of nursing home stays on household portfolios.

 Nursing home stays among retirees have increased steadily during the past decade. Among people age 65 and higher, nursing home stays increased from 6 percent in 2000 to 8.5 percent in 2010.  Nursing home stays have strong and statistically significant negative effects on every type of household asset holdings except higher-risk assets (such as stocks, bonds, and mutual funds).  Among nursing home entrants, purchase of long-term care insurance (LTCI) has also increased steadily during the past decade, but coverage remains low (14 percent in 2010).  For those who spent six months or more in a nursing home facility, nearly half were covered by Medicaid.  Those who reported being most likely to enter a nursing home in the near future were also less likely to purchase LTCI.  Over the past decade, use of professional home-health care has increased steadily, as has the percentage of people with LTCI who use professional home-health care. But here also (for those using home-health care), LTCI coverage is low—13.2 percent in 2010.  For those who have lived in a nursing home for six months or more, the median total household wealth was only $5,518.  After respondents' first entries into a nursing home, total household wealth fell steadily over a six-year period. By comparison, household wealth increased steadily over any six-year period for those who never entered a nursing home.  For nursing home entrants, median housing wealth falls to zero within six years after the initial nursing home entry.  Both mean and median levels of every type of wealth are much higher for those who did not use professional home health-care than those who did. assistance from the Institute's research and editorial staffs. Any views expressed in this report are those of the author, and should not be ascribed to the officers, trustees, or other sponsors of EBRI, EBRI-ERF, or their staffs. Neither EBRI nor EBRI-ERF lobbies or takes positions on specific policy proposals. EBRI invites comment on this research.