Average cost of long-term care insurance
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Long-term care insurance provides financial protection for prolonged care costs associated with aging. This coverage goes beyond short-term medical treatments and includes help with activities of daily living (ADLs), medical assistance and emotional support.
The cost of long-term care insurance depends on the policyholder’s age, health condition, marital status and gender, as well as the amount and length of coverage.
Long-term care insurance provides coverage for prolonged care needs that tend to arise as we age.
Jump to insightLong-term care insurance costs depend in large part on your gender — a 65-year-old woman might pay $2,700 yearly, while a 65-year-old man pays $1,700 a year for the same coverage.
Jump to insightNot everyone needs long-term care insurance; government aid programs, like Medicaid and Medicare, and hybrid insurance policies may be a better fit for your care needs.
Jump to insightWhat does long-term care cover?
Long-term care insurance covers a wide range of care options. Whether you need assistance with tasks at home, regular counseling services or nursing home help, this type of coverage might work for you.
» MORE: What is long-term care insurance?
Long-term care insurance covers the following:
- In-home care
- Skilled nursing care at home
- Therapy services
- Adult day service centers
- Hospice care
- Respite care
- Assisted living facilities
- Alzheimer's special care facilities
- Nursing homes
- Memory care
» MORE: 9 benefits of respite care
Benefits of long-term care
Long-term care insurance acts like a shield against the often exorbitant costs of extended care services. The expenses associated with in-home care, assisted living, nursing homes and specialized memory care can quickly add up, eroding any savings you have.
This type of insurance plan can make a big dent in these aging-associated health costs. Ideally, this coverage keeps your finances steady so you can focus on your relationships and the things that matter most to you.
» CALCULATE POTENTIAL SAVINGS: Nursing home costs
How much is long-term care insurance?
According to the 2023 price index from the American Association for Long-Term Care Insurance, for policies that provide $165,000 in benefits, single men paid anywhere from $900 to $1,700, while single women paid from $1,500 to $2,700.
The low end of these ranges represents averages for 55-year-old adults; the high end is for adults aged 65.
Yearly premiums based on gender, marital status and age
| Age 55 | Age 60 | Age 65 | |
|---|---|---|---|
| Single man | $900 | $1,200 | $1,700 |
| Single woman | $1,500 | $1,960 | $2,700 |
| Couple (combined) | $2,080 | $2,550 | $3,750 |
5 cost factors for long-term care insurance
Several factors play a role in the cost of your premiums — understanding these variables can help you determine whether the coverage is worth it for you.
1. Age
As you age, your insurance premiums tend to rise. This is because older individuals are more likely to face health issues and require care, leading to increased risks for insurers.
2. Health condition and existing health problems
Your medical history plays a crucial role in insurance cost determination. Better health often translates to lower premiums. However, if you have preexisting conditions, you might face higher premiums or even potential coverage denial.
3. Gender
Women typically pay higher premiums due to their longer life expectancy — an extended life span means a higher likelihood of needing related care.
4. Amount and length of coverage
The extent of coverage you choose and the duration for which you’re covered directly impact your premium payments. Opting for longer coverage periods usually results in higher premiums, while shorter periods can offer more budget-friendly policies.
5. Marital status
If you’re married and sign up for a policy with your spouse, you’re likely to save. Joint policies are usually more affordable than separate policies, though savings vary by provider.
Long-term care costs without insurance
Below are the nationwide median monthly costs for long-term care in 2023, according to the Genworth Cost of Care Survey:
- In-home care: $5,720 for homemaker services; $6,292 for home health
- Community and assisted living: $2,058 for adult day health care; $5,350 for assisted living
- Nursing home facilities: $8,669 ($9,733 for a private room)
Pros and cons of long-term care insurance
Pros
- Helps save from extremely high care costs that can quickly add up
- Can assist in providing access to a variety of aging-related services
- Easy accessibility to modifying coverage and features as needs change
Cons
- May be unnecessary depending on individual circumstances
- Coverage can be expensive and not worth it if you qualify for other cost-saving programs or services
- If changes need to be made to long-term care insurance plans, premiums can rise
Alternatives to long-term care insurance
While long-term care insurance offers protection against the financial strain of extended care, it might not suit everyone due to eligibility criteria, high premiums or personal preferences. Fortunately, there are alternatives available.
If you have the financial means, you can directly finance the cost of care. It's crucial to acknowledge that long-term care expenses can be exorbitant, though — it can take substantial savings.
» MORE: Assisted living vs. nursing home vs. home care
Government Aid Government programs, notably Medicaid and Medicare, offer assistance in covering extended care expenses. Medicaid serves as a government-funded health insurance for low-income individuals and families, and Medicare caters to those 65 and above and individuals with specific disabilities.
Medicaid predominantly covers long-term care services, but its eligibility criteria are stringent, often excluding those with assets or income. Although Medicare doesn't encompass long-term care, it does defray certain expenses tied to skilled nursing care and home health care.
» MORE: Medicare vs. Medicaid
There are also hybrid policies available that combine long-term care coverage with other types of insurance, like life insurance or annuities.
FAQ
What are some of the top-rated long-term care insurance companies?
To find the best long-term care insurance company for your needs and preferences, we recommend conducting thorough research.
Can I get long-term care insurance if I have a family history of health issues?
Underwriters might consider family history, but it's not a guarantee of coverage or denial. Insurance companies assess various factors, including your current health and medical records, when determining eligibility and premiums.
Can I modify my long-term care insurance coverage over time?
Many long-term care insurance policies offer flexibility, letting you adjust coverage amounts and features as your needs change. However, such modifications might impact your premiums.
Article sources
ConsumerAffairs writers primarily rely on government data, industry experts, and original research from other reputable publications to inform their work. Specific sources for this article include:
- Administration for Community Living, “What Long-term Care Insurance Covers.” Accessed Aug. 4, 2023.
- SeniorLiving.org, “Nursing Home Costs in 2023.” Accessed Aug. 4, 2023.
- Genworth Financial, “Cost of Care Survey.” Accessed May 8, 2024.
- American Association for Long-Term Care Insurance, “Long-Term Care Insurance Facts - Prices - Data - Statistics - 2023 Reports.” Accessed Aug. 15, 2023.