Starbucks Employees: Navigating the Complexities of Extended Care Costs in Retirement

Healthcare Provider Update: Healthcare Provider for Starbucks: Starbucks primarily provides health insurance coverage to its employees through the company's dedicated offerings, which include various health plans designed to meet diverse employee needs. While specific plan details may vary by location and job classification, Starbucks provides significant healthcare benefits aimed at ensuring employee wellness. --- Potential Healthcare Cost Increases in 2026: As Starbucks employees look toward 2026, a notable surge in healthcare costs is anticipated, primarily due to escalating premiums on plans offered through the Affordable Care Act (ACA) marketplace. Insurers are seeking significant increases, with forecasts suggesting that some states might see hikes exceeding 60%. The expiration of enhanced federal premium subsidies is a critical factor, potentially resulting in average increases of over 75% in out-of-pocket premium payments for many enrollees. This confluence of factors could substantially impact employees' health expenses, necessitating careful financial planning and evaluation of coverage options. Click here to learn more

Addressing the potential risks of extended-term care expenses may be one of the biggest financial challenges for Starbucks employees who are developing a retirement strategy.

Seven in ten Starbucks employees over age 65 can expect to need extended care services at some point in their lives. So understanding the various types of extended care services – and what those services may cost – is critical as you consider your retirement approach.

What Is Extended Care?

Extended care is not a single activity. It refers to a variety of medical and non–medical services needed by those who have a chronic illness or disability – most commonly associated with aging.

Extended care can include everything from assistance with activities of daily living – help dressing, bathing, using the bathroom, or even driving to the store – to more intensive therapeutic and medical care requiring the services of skilled medical personnel.

Extended care may be provided at home, at a community center, in an assisted living facility, or in a skilled nursing home. And extended care is not exclusively for the elderly; it is possible to need extended care at any age.

How Much Does Extended Care Cost?

Extended care costs vary state by state and region by region. The 2021 national average for care in a skilled care facility (single occupancy in a nursing home) was $108,405 a year. The national average for care in an assisted living center (single occupancy) was $54,000 a year. Home health aides cost a median of $27 per hour, but that rate may increase when a licensed nurse is required.

What Are the Payment Choices?

Often, extended care is provided by family and friends. Providing care can be a burden, however, and the need for assistance tends to increase with age.

Starbucks employees who would rather not burden their family and friends have two main choices for covering the cost of extended care: they can choose to self-insure or they can purchase extended care insurance.

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Many self-insure by default – simply because they haven't made other arrangements. Those who self-insure may depend on personal savings and investments to fund any extended care needs. The other approach is to consider purchasing extended care insurance, which can cover all levels of care, from skilled care to custodial care to in-home assistance.

When it comes to addressing your extended care needs, many look to select a strategy that may help them protect assets, preserve dignity, and maintain independence. If those concepts are important to you, consider your approach to extended care. 

GenWorth.com, 2022

ACL.gov, 2022