Inflation and the shortage of skilled care workers were the main drivers of increases in the rising costs of long-term care services in 2023, with skilled nursing rooms posting the highest increase.

Genworth’s latest Cost of Care Survey released Tuesday found that since 2022, the national annual median cost of a semi-private room in a skilled nursing facility jumped to $104,000 in 2023, an increase of 4.4%, while the cost of a private room in a nursing home increased 4.9% to $116,800.

The 2023 survey participants reported that a shortage of skilled workers was the top contributing factor for nursing homes and homecare. Moreover, inflation was the leading factor contributing to cost increases for assisted living facilities.

However, assisted living facility rates increased less sharply than in the past years. ALF rates rose by 1.4% to an annual national median cost of $64,200 per year.

“As we look at this year’s data, costs are up, but not as drastically as in previous years, especially assisted living facilities, which only increased 1.4% from 2022 to 2023, but a total of 18.9% from 2021 to 2023. This is likely due to inflation and housing market trends stabilizing post-pandemic,” said Jamala Arland, President and CEO, Genworth U.S. Life Insurance. “With 10,000 Baby Boomers turning 65 every day until 2030, and seven out of ten of them likely to need long-term care services and support at some point, there is increased demand for skilled workers in the long-term care space,” Arland said.

The most substantial cost increases were connected to home health aides, with costs rising by 10.0% to an annual median cost of $75,500. Home health aides provide “hands-on” personal assistance with activities such as bathing, dressing, and eating. Also, costs related to homemaker services, which include tasks such as cooking, cleaning, and running errands, rose by 7.1% to an annual median cost of $68,600.

“We saw increases between 1% and 10% across facility types for this year’s survey,” said Arland. “While this continues the upward trend we’ve seen over the past several surveys, we are actively digging deeper into the data to analyze trends and plan to share those findings in the coming months.”

The 2023 survey added person-centered care sentiment as a new component. And regardless of facility type, the survey found that 95% of respondents placed a very high importance on the idea of person-centered care. Respondents cited staff training and cost as being the top barriers impacting a provider’s ability to offer person-centered care.

The Richmond, Va.-based Genworth, which offers long-term care insurance, contacted 176,000 long-term care providers nationwide, and completed more than 11,000 surveys for nursing homes, assisted living facilities, adult day health facilities and home care providers from September to December 2023.