Sonora Mexico:
An Affordable Option for Independent & Assisted Living
An Overview
With nearly 60 million American adults currently age 60 or older, and the numbers of senior citizens growing daily, the aging of the US population is a vast and timely trend and will be for years to come.
Baby Boomers have now reached retirement age and the need for independent living, assisted living and other long-term care options has never been greater. However, high costs for building, staffing, and managing facilities in the US have limited developer investment and the typical facility is not affordable by the majority of middle-class would-be residents.
Mexico offers the promise of good-quality, affordable options for both care providers and those seeking care. This paper will be exploring the feasibility and desirability of Mexico, particularly the state of Sonora, as a retirement destination, especially for those seeking independent or assisted living.
Demographics & Assisted Living
Retiree Income
A more in-depth look at the numbers reveals why assisted living in the US is not affordable for many seniors. The mean income of 48% of retirees 65 years and over in the US is $22,862. And that represents all sources of income, not just Social Security (collected by 91.5% of those 65 and over) at a mean of $18,123 annually.
Of those collecting Social Security, half started collecting before they had originally planned, while only 5% retired later than originally planned. Almost four in 10 respondents (37%) who retired earlier than they had planned cite health-related reasons for doing so.
The Costs and Payment for Assisted Living
In the United States between 75–90% of the cost of assisted living is paid out of pocket. Medicare, the major source of medical coverage for retirees, typically contributes nothing for living costs including independent and assisted living. The Canadian Long Term Care Funding Center Inc. states that, depending on where retirees reside, the monthly cost of long-term care can range between $2,800 and $9,000. Residents pay 70% of their after-tax income for a full package of services. Individuals with high income spend up to a maximum amount based on actual cost.
According to Assisted Living Federation of America, costs vary greatly from state to state. Table 2 in the endnotes shows the minimum, maximum and median rates for the 52 states in the US. The quality of care ranges from the very good to the frighteningly bad.
MetLife’s Mature Market Institute puts the average rate for a stay at an assisted-living facility in the US at $3550 a month in 2012, up from $3477 in 2011. With the mean retiree income at $22,862 annually, and the average cost of assisted living at $42,600 annually, there is obviously a huge “affordability” gap.
Nursing home care typically runs higher, up to $9750 per month. The national average daily rate for a private room in a nursing home is $248, while a semi-private room is $222 (up from $239 and $214 respectively in 2011).
Even the cost for in-home care support is prohibitive for many in the US. The national average hourly rate for home-health aides is $21, while the average hourly rate for a homemaker is $20 in 2012.
The Opportunity
In the US, over 8,000 adults per day turn age 60. An estimated 10 to 15 million people will be seeking retirement or care in Mexico by 2025, a trend that is encouraged by the Mexican government.
Why the State of Sonora?
Geography
The state of Sonora is located in Northwest Mexico just south of the US state of Arizona. It borders the US, the Sea of Cortez (sometimes called the Gulf of California) and the Mexican states of Baja California, Chihuahua and Sinaloa. Important cities are Alamos, Bahia Kino, Guaymas, Puerto Peñasco (Rocky Point) and Hermosillo, the capital.
Border crossings can be made at the San Luis Port of Entry, a busy US port of entry since the early 1900s. It is located on Highway 95 in the town of San Luis in Yuma County, Arizona, and the border crossing is open 24 hours a day year-round.
The landscape of Sonora is uniquely beautiful, consisting of stunning beaches, lush valleys, majestic mountains and arid deserts, all part of the Sierra Madre Occidental mountain range. These features have traditionally been popular with tourists and retirees.
Transportation
Mexico’s interstate highway system (“cuotas” or toll roads) surprises many visitors. Not only are the roadways well-maintained, they are well-designed with good signage, smooth pavement, safe shoulders, pull-off areas, roadside assistance and gas stations, very much like the interstate system in the United States.
Sonora has a four-lane highway network of approximately 18,000 km. Federal Highway 15—which is the primary highway in Mexico—begins at Nogales, Sonora and ends in Mexico City. The beautiful coastal Highway 3 runs from the border crossing at San Luis, Arizona south to Puerto Penãsco (Rocky Point) and beyond.
Executive (first class) bus service is common throughout Mexico and has been compared to first class airline travel offering comfortable seating, movies, food and drink served by hostesses and onboard bathrooms.
Sonora is home to five international airports. These airports are located in the capital city of Hermosillo, Puerto Peñasco, Ciudad Obregon, Nogales and Guaymas. The port of Guaymas (“Puerto Guaymas”) is the major shipping port in the State of Sonora.
Climate
Mexico is known worldwide for its sunny weather and, like the desert southwest in the US, northern Mexico is typically dry and sunny most of the year with the kind of climate that has made Arizona a popular tourist and retirement destination.
The coastal regions of Sonora are generally warm and dry with a year-round average temperature of about 75° F. The northern part of the state is temperate and dry with an average year-round temperature of about 61° F. In the mountain regions, temperatures can be much cooler. In Hermosillo, the average year-round temperature is about 75° F. The average rainfall in the capital is about 9.5 inches per year. In the northern city of Nogales, average rainfall is about 16.9 inches per year.
Proximity
Many of the best locations for independent and assisted living in Sonora are within an hour’s drive of the US border, including beachside and ocean-view properties. (All beachfronts are public in Mexico.) Sonora is in the Mountain Standard Time Zone making connections, jet-lag-free travel and communications with those in the US and Canada easier.
Financial and Cost-of-Living Advantages of Mexico
Mexico has a stable economy and the national government seeks opportunities for development. International banks such as HSBC and the Canadian ScotiaBank have branches in cities virtually everywhere in the country. Payment by credit card is common in cities and it is relatively easy to exchange dollars and pesos.
Cost of Living
The cost of living is significantly lower overall in Mexico: rent, food, utilities, propane, gasoline, medical care, etc. There are exceptions: electronics, cars and luxury items can be more expensive in Mexico.
Cost of Labor & Construction
Construction costs vary depending on the location (a factor in land acquisition and construction), cost of local materials and the availability of local labor. Wages for both skilled and unskilled construction laborers are low. So low, for example, that people are sometimes hired do manually what would be done by machine in the US. As a family-oriented culture, laborers do not like to be away from home and may require additional incentives if travel to outlying construction sites is involved.
Although it varies from job to job and place to place, typically a month’s salary of 3000 pesos (approximately $250 US dollars) for household help (housekeepers, laundress, cook, gardener) is considered a reasonably good wage in Mexico for a 45-hour workweek over 5 or 6 days.
Labor laws in Mexico tend to favor employees over employers and complaints resulting in violations are common, so due diligence is especially important when hiring. However compliance with building regulations, where they exist, will typically be far less expensive than in the US or Canada.
Defining Independent & Assisted Living
The goal of both independent and assisted living facilities is to offer a healthy lifestyle and needed safety and care for seniors. The type of care required for retirees ranges from almost no specialized care, to total dependency and full-time nursing care.
The categories that most concern us here, by degree of need, are “independent living” where housekeeping help is standard and a supplemental menu of available services can be utilized on an “as needed” basis, and “assisted living” where more extensive care is needed and an entire menu of services are typically included for a monthly fee.
Typical Features of Assisted Living
HelpGuide.org indicates that the typical features of assisted living facilities are as follows:
•Three meals per day in common area which serves as dining room
•Help with eating meals, bathing and dressing, going to the bathroom, as well as walking.
•Housekeeping activities;
•Transportation;
•Access to health care;
•Security throughout the day – 24 hour security;
•Call systems for emergency in each living area;
•Wellness programs including regular exercise;
•Management of medication;
•Washing and ironing clothes;
•Activities for recreation and to enable socialization;
•Employees to help with both scheduled and unscheduled activities
The Extras in Mexico
It is common for assisted care facilities in Mexico to also offer Internet service, libraries, video games, cable or satellite television in English and other electronic and telecommunications amenities. Some offer luxury features such as swimming pools, patios, exercise-machine equipped gyms, putting greens, landscaped walkways and bike paths. The presence of medical staff on a 24-hour basis is an option for larger assisted living facilities.
The Benefits of Sonora
The climate and geography of Sonora is conducive to a number of outdoor activities that are features of assisted-living programs based there: year-round swimming, walks on the beach or in the desert, biking, gardening, fishing, star gazing, bird & whale watching, dining alfresco, etc.
Designed for Levels of Need
Facilities often reflect the changing needs of residents: from well-designed, low-maintenance individual houses of 900 to 1000 sq. ft. for independent-living couples or singles, to mini-apartments or rooms for assisted living that are connected via interior corridors with a central commons area where a dining room, exercise and recreation areas, medical center, lobby and administrative offices are located. Some facilities also include a special section or separate building for residents requiring full-time nursing care.
Cultural Differences & Similarities
Cultural Change
Assisted living is a relatively new concept in Mexico. This is a culture where the vast majority of elderly people still live with family members. Nursing homes, the only option outside of the family home in the past, were traditionally run as charities. This is changing as two-income families are more common and working family members are less capable of providing full-time care for elderly family members.
Families Matter
Independent and assisted living facilities should accommodate visiting family members in Mexico in everything from parking to meals. Whenever possible, independent housing should provide sleeping areas for family members, or there should be accommodations for visitors available as part of the facility or in hotels or “posadas” (bed & breakfasts) nearby.
Happier Employees
While housekeepers, cooks, laundresses and gardeners earn lower pay in Mexico, workers are often happier in their jobs. These jobs are considered honorable and valued professions rather than the negative stigma of minimum-wage jobs often found in the US. Consequently there is typically less employee turn over.
Attitudes about the Elderly
Elderly people are loved and respected in Mexico. And, in a culture where there are relatively fewer elderly people (30% of the population is 14 or under and the median age is 26) it is not unusual for children, teens and young adults to be sensitive to the needs of the elderly around them and, for example, offer a helping hand on the street.
English is Spoken Here
The business and healthcare communities of both Mexico and the United States are investing in care facilities in Mexico designed to serve the elderly from the English-speaking world. You can expect members of the administrative and medical staff to be appropriately educated, well-trained professionals and bilingual. Other staff members may have some level of English. There is no requirement for foreign residents to learn or use Spanish, although some facilities offer classes.
Food is Familiar
While there are differences in the basic diets of Mexicans and other North Americans, there are also many similarities. Most of the staples for a typical American/Canadian diet are readily available including high quality meats, fish, grains such as wheat, rice and cornmeal, eggs and a wide variety of dairy products. Mexico is also known for colorful year-round fresh fruits and vegetables and “pan dulces” (sweet pastries) as well as various juices, “aguas” and popular beers. Drinking water is always bottled or purified on site.
Religion is Important
Although Catholicism has been the dominant religion of Mexico for generations, the numbers and varieties of Protestant faiths have grown rapidly in recent years. There are Jewish congregations in some cities and there are resurgences of traditional pre-Columbian spiritual practices in the form of dances, drumming and native music in some places. The spiritual needs of most people can be met in Mexico.
Holidays are Celebrated
Parties (“fiestas”) marking birthdays and other milestone events and religious or historical holidays are an important part of life everywhere in Mexico. You can expect numerous fiestas to be part of the ebb and flow of daily life in assisted living facilities for foreigners as well. Staffing during “Navidad” (the Christmas holiday, celebrated from November to February) may be challenging since it is the traditional time for vacations and family reunions.
Traditional Medicine in Mexico
Hospitals
There are over 4000 hospitals in Mexico ranging from small private institutions with only a few beds to large, modern public complexes with beds for many hundreds of patients. Several government and charitable programs have their own network of hospitals including the Red Cross of Mexico and IMSS (Instituto Mexicano del Seguro Social).
Sonora has its share of excellent care facilities including a prestigious JCI (Joint Commission International) accredited hospital: Hospital CIMA Hermosillo, one of only 250 internationally. (CIMA is owned by a US company and has strong connections with the University of Baylor.) In collaboration with the World Health Organization, the JCI evaluates hospitals and accredits only those that meet high standards in such areas as facilities management, patient safety, medication safety, infection prevention and control, etc. There are eight hospitals and one ambulatory care program that have completed the JCI’s accreditation process in Mexico.
Mexico has been at the forefront of countries with hospitals and practices offering treatment for “medical tourists” from all over the world. There are affordable options for a wide variety of treatments including heart surgery, joint replacement, cancer treatment, IVF, kidney transplantation, etc. There are several chains of American-owned hospitals. There are also many dentists providing care for foreigners.
Medical Schools
Mexico has a number of prestigious medical schools. Not only do they train native Mexicans, there are thousands of medical students from other countries including the US and Canada. Medicine is very international and many of Mexico’s physicians are bi-lingual and/or have received some part of their training in English in the US or Canada. Starting salaries for physicians in Mexico are about $12,000 per year and trained nurses are paid approximately $550 a month. Low salaries are one of the major reasons assisted living is more affordable in Mexico.
Board Certification
There are over 30 specialty medical boards in Mexico that control the certification of medical specialists. Specialists are typically found in cities rather than in rural areas.
Medicare in Mexico
Medicare, the mainstay of US healthcare for seniors, does not cover care in Mexico, although US hospitals that do accept Medicare patients are nearby in Arizona on the US side of the border. There are currently lobbying efforts to extend Medicare coverage to citizens living outside of the US and when there is more pressure to lower medical costs with implementation of “Obamacare,” this may be more likely for the cost-savings advantages.
IMSS Coverage
Mexico currently offers reasonably priced hospital and medical coverage (cost varies but in the range of $300 to $350 per year) to permanent residents through voluntary participation in the government-run IMSS program. While definitely on the “no frills” side of care, and there are waiting periods for some treatments and exclusions for pre-existing conditions, this is an option for some. Doctors are assigned and care is limited to IMSS hospitals.
Payment for Hospital Care
While there are some forms of international insurance that are accepted by some hospitals in Mexico, most do not accept assignments of benefits from third party providers. Although the hospital bill will typically be a fraction of what similar hospital stays and treatment would cost in the US, private hospitals require cash payment before a patient is released from the hospital. If the patient has coverage, they are typically expected to bill the carrier on their own.
Practice Style
Physicians in Mexico practice a slower, more hands-on style of medicine. Many patients from the US, accustomed to the rushed pace of medical practices there, are delighted with the more “user friendly” approach practiced in Mexico and prefer it to US-style medical treatment.
Pharmaceuticals
High-quality pharmaceuticals are widely available everywhere in Mexico, although few pharmacists are specifically licensed to dispense controlled narcotic medicines. The national health department strictly oversees the manufacturing of pharmaceuticals and the standards are high. Many medicines are made in Mexico for export to the US and other markets.
Alternative Medicine
Many healing techniques, now common in the rest of the world, were adopted long ago in Mexico and have been benefiting patients for years. This is just as true today and one of the gifts of the medical system of Mexico is that it is less restrictive about alternative and experimental medicine, giving hope and new healing modalities to those with serious illnesses.
Alternative medical treatments include bariatric surgery for weight loss, hyperbolic oxygen therapy, chelation therapy, various alternative or experimental treatments for cancer, stem-cell therapy, high-intensity focused ultrasound (HIFU), hyperthermia treatments, immune therapy, integrative medicine, ozone and bio oxidative therapy and more.
Of course, as with any form of experimentation, not everything works as expected, and perhaps more than in the US or Canada the patient him or herself shoulders the responsibility for making decisions regarding their own care. Malpractice insurance is uncommon in Mexico. The idea that a patient would sue a doctor for a bad outcome is ludicrous to Mexicans who are in disbelief about the large awards given in the US. Patients need to understand both the experimental nature of their treatment and the risks.
Summary
A growing number of retirees and their families, driven by rising costs in their home country, seek Mexico as a place for both affordable living and needed care. For most, the costs in Mexico are one half or less than what the costs would have been for equivalent care in the US. Add to that a lifestyle so agreeable and a climate so warm and sunny that friends and family are happy to visit or even vacation nearby.
Affordable independent- and assisted-living care in Mexico, particularly in the ideal setting of Sonora, can provide ample benefits for developers, care providers and many retired seniors from the US and Canada.