The Holiday Inn vs. Nursing Home Fallacy

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This idea (or the "Cruise ship vs. nursing home" variation) has been around on the internet and e-mail chains for years.  But when my mom recently forwarded it to me from a group of her friends, it just set me off.  Here's the e-mail ... my commentary follows:

No nursing home for us.  We'll be checking into a Holiday Inn!  

With the average cost for nursing home care being $188.00 per day, there is a better way when we get old and too feeble.  I've already checked on reservations at the Holiday Inn.  For a combined long term stay and senior discount, it's $59.23 per night.  Breakfast is included, and some have happy hours in the afternoon.

That leaves $128.77 a day for lunch and dinner in any restaurant we want, or room service, laundry, gratuities, and special TV movies.  Plus, they provide a spa, swimming pool, a workout room, a lounge and washer-dryer, etc.  Most have free toothpaste and razors, and all have free shampoo and soap.

Add $5 worth of tips a day you'll have the entire staff scrambling to help you.  They treat you like a customer, not a patient.

There's a city bus stop out front, and seniors ride free.  The handicap bus will also pick you up (if you fake a decent limp).  To meet other nice people, call a church bus on Sundays.  For a change of scenery, take the airport shuttle bus and eat at one of the nice restaurants there.  Or while you're at the airport, fly somewhere.  Otherwise, the cash keeps building up.

It takes months to get into decent nursing homes.  Holiday Inn will take your reservation today.  And you're not stuck in one place forever - you can move from Inn to Inn, or even from city to city.  Want to see Hawaii?  They have Holiday Inn there too.
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TV broken?  Light bulbs need changing?  Need a mattress replaced?  No problem.  They fix everything, and apologize for the inconvenience.

The Inn has a night security person and daily room service.  The maid checks to see if you are ok. I f not, they'll call an ambulance . . .Or the undertaker.  If you fall and break a hip, Medicare will pay for the hip, and Holiday Inn will upgrade you to a suite for the rest of your life.

And no worries about visits from family.  They will always be glad to find you, and probably check in for a few days mini-vacation.  The grand-kids can use the pool.
What more could I ask for?

Please pardon my over-sensitivity to this old trope.  I do realize it's really just a joke (as a "real" LTC planning idea it's truly a JOKE), but I meet far too many people on a daily basis who continue to turn a blind eye toward real, thoughtful, grown-up long-term care planning who take ideas like this as Conventional Wisdom, and they flippantly use it (or the "Cruise Ship vs. Nursing Home" variation) as a convenient way to allow themselves to shrug their shoulders at engaging in a personal, adult conversation about the topic.  

The real problem with this is two-fold:

1. It shows a profound misunderstanding of what long-term care really is.
2. And the math really doesn't work ... 

Click "Read More" below for more details:

Some facts:
Even Holiday Inns now cost way more than $59.32 a night.  I just checked the St. Louis area.  The cheapest senior-discounted, one-month rate was $95.59/night.  (I did find a Candlewood Suites across the Mississippi in O'Fallon, IL, for $72/night.)  OK, so let's say it's now $100/night, breakfast included - that's $3,000 a month.

A $5 per day tip may get you great housekeeping service and an occasional helping hand out the front door to "limp" to the bus.  But I don't know of any Holiday Inn - let alone even a Ritz-Carlton - that will send someone to your room one, two, or three times a night to make sure you safely get out of bed, to and from, and on and off the toilet with hygiene assistance.  Nor do I know of any hotel that would allow a staff member to help you dress or bathe.  You fall and call for help getting up once, you're OUT.

In the St. Louis area - which matches much of the rest of the country - you can get a very good, one-bedroom assisted living apartment with THREE meals per day, transportation services, medication management, and occasional "personal care" for just a little more: $3,600 per month, or $120 per day.  Including the "Holiday Inn $5 daily tip", where else can you get lunch and dinner for $15 a day?!  (https://www.genworth.com/dam/Americas/US/PDFs/Consumer/corporate/cost-of-care/118928MO_040115_gnw.pdf)

And using the $188/day budget, you still have $68 a day ($2,040 per month) for anything else you may want to do, including meals out.

What this silly meme is really talking about is "independent living" or "retirement living".  "Independent" being the key word.  If that's you, I say, "Go for it!  Check into the Holiday Inn, or book the perpetual cruise."  But if you NEED to be in a nursing home because of a disability or severe frailty - or even Assisted Living for only a moderate degree of help - there isn't a Holiday Inn or cruise ship in the world that would rent you a room, ever.

$188 to $210 a day is still a pretty good number for an above-average nursing home room in the St. Louis area, but for most elderly people with means the nursing home is no longer the only care option.  IF ever needed, it is the place of last-resort at the very end of life.  As I've already pointed out, Assisted Living for those who need less help is much less expensive - pretty much the same as "The Holiday Inn Option" - and Assisted Living provides real personal care including memory care, and/or help with those basic activities we take for granted which make up the bulk of long-term care needs like transferring, dressing, bathing, and toileting.

80% of long-term care services are provided in a person's own home.  Ask the Holiday Inn, how much of your own personal items and furniture you can move in with you?

Long-term care does not mean going from shooting your age on the golf course one day to being flat-on-your-back-in-a-hospital-bed the next (whether that hospital bed is in a nursing home or your own dining room).  Long-term care for most people is a continuum of needs and services that often start with limited personal care assistance and which may never require the services of a fully skilled nursing home.

Of course you'll still go out to eat or even travel if you need long-term care.  I'm "A-List Preferred" with Southwest Airlines, which means I'm always one of the very first to board a plane ... except for that line of folks with the blue plastic pre-boarding authorization cards.  Can you say "transferring assistance"?!

A friend of mine says it best, there are three stages of retirement to plan for:

1. The "go-go" years.
2. The "slow-go" years.
3. The "no-go" years.

Go-go is what we all want, imagine, and even plan for financially.  Those slow-go years may be where basic long-term care needs begin to arise, but can still be managed and lifestyle maintained IF there is enough money to pay for care and lifestyle at the same time - especially if there is a still-healthy spouse or partner in the mix.  The no-go years for the most part have been relegated to the very end of life thanks not only to medical technology, but also the availability of professional long-term care services to provide both care and access to ongoing lifestyle at the same time.

Let's imagine a retired couple with only one of them - the man - entering the slow-go years; his wife is still go-go.  And their income is $188 per day ($5,640/month).  How much of that income is already committed to "lifestyle" - both basic needs and "extras"?  All of it.  (Ask any retiree what portion of their budget is "extra" or discretionary.  What is the answer most likely to be?  Right, "None".)

"Do you have enough money to both pay for care and maintain lifestyle?"  If the answer is no, or you're not sure, that's where LTC insurance is needed - even just a small policy can make a huge difference in both quality of care and maintaining lifestyle.