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Find the Best Long-term Care Insurance Companies

by Matthew Brodsky Insurance Contributing Editor

Predicting long-term care expenses is difficult when regular insurance and Medicare don't cover the ongoing custodial care you may need. Long-term care insurance protects your savings if you need this type of care. Read our guide to research and discover the best long-term care insurance for you.

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What is long-term care insurance?

Long-term care insurance helps cover the cost of medical and nonmedical care in settings including your home, an assisted living facility, a memory care facility and a nursing home. Generally, the costs associated with long-term care are not fully covered by traditional health insurance providers or government programs like Medicare. Instead, many opt to add long-term care insurance to their senior care plan to avoid paying 100% out of pocket. If you don’t have long-term care benefits, the cost of long-term care can quickly deplete your savings.

Long-term care insurance policies consider your ability to perform activities of daily living (ADLs) and/or the presence of cognitive impairment to determine your benefits eligibility. ADLs include basic functions like dressing and grooming, toileting, bathing, eating and continence.

What does long-term care insurance cover and not cover?

Long-term care insurance covers expenses for personal or custodial care in your home or another care setting, such as an adult day care center, an assisted living facility, a memory care community or a nursing home. Long-term care insurance can also pay for home modifications, such as wheelchair ramps and safety grab bars. Care coordination services are included in some of the best long-term care insurance policies.

Long-term care coverage exclusions

Long-term care insurance is not intended to cover medical expenses or care for preexisting conditions, including heart disease, cancer, diabetes and some mental disorders. Most long-term care policies also exclude coverage for long-term illness or injuries caused by things like alcoholism, drug abuse, self-inflicted wounds or mental disorders.

Long-term care insurance probably won’t cover your phone, cable or internet bill if you are in an assisted living facility or nursing home. Additionally, long-term care insurance doesn’t cover in-home care provided by a family member.

How does long-term care insurance work?

Government policies like Medicare and Medicaid only cover long-term care services in very specific situations, so older adults and families on tight budgets often have to pay for daily care services out of pocket. Long-term insurance care covers these expenditures so you can save money for other living expenses. 

To apply for long-term care insurance, you need to select a suitable program and fill out details about your medical history. Once your application is approved, you pay a fixed amount, known as a premium. This fee is used to reimburse you in the future when care services are needed. However, there is often a 30- to 90-day gap, or an “elimination period,” where you have to wait for your insurance policy to begin reimbursing your costs. This waiting period starts once you meet the criteria for starting to receive benefits. Costs during the elimination period must be paid out of pocket.

How much does long-term care insurance cost?

Long-term care insurance costs can range from $1,000 to $5,000 or more per year, depending on the age when it was purchased, the applicant’s health and the amount of coverage chosen. The average long-term care insurance premium is about $2,200 each year and provides daily benefits of $150 to $160 for a period of two to five years.

The earlier you buy long-term care insurance, the less you have to pay in premiums each year. Long-term care insurance costs also vary by your location, gender and marital status. Shared care policies, which allow a couple to combine their benefits for both or one to use, are popular with married couples who also want a discount for enrolling at the same time. With a shared care long-term care insurance policy, the total coverage for each policy is combined and available between the two people named on the policy.

Long-term care insurance rates also depend on the level of coverage you want. Premium or upgraded insurance tiers come with a higher price tag, but the additional cost might be worth it if you end up needing professional custodial care for an extended period.

Most long-term care insurance companies offer monthly payment options, but you may get a better deal by paying for the year upfront. Long-term insurance policy options are sometimes “guaranteed renewable,” meaning the insurance company cannot cancel your policy. The company can, however, raise your premiums as part of long-term care insurance rate increases for a class of policies.

It’s important to know that an insurance company must first seek approval from each state insurance department for a rate increase, and the rate can only be increased to the amount approved by the department. If this happens, you are given the choice to accept the rate increase, accept changes in benefits to keep your cost the same or forfeit your policy and receive a paid-up policy equal to the amount of premiums you have paid. While nearly every insurance company has had to raise rates in the past, the policies sold today are priced much more accurately and much less likely to need a rate increase. However, it is always good to be prepared for these increases.

Tax advantages help balance out the cost of long-term care insurance. You can deduct part or all of your long-term care insurance premiums as medical expenses if you itemize them as deductions on your federal income tax return. Eligibility premiums, or the amount that may be claimed as a medical expense, are set by certain age thresholds. For example, those under the age of 50 can deduct up to $810, while those older than 71 can deduct up to $5,430. Business owners have additional tax advantages if they pay for LTC insurance through their company. Finally, LTC insurance premiums can be paid with pre-tax HSA dollars for all individuals.

To get the best price on long-term care insurance, you should work with an experienced agent or broker that offers insurance products from multiple carriers. Be sure to get the best deal by comparing multiple long-term care insurance quotes. And remember, it never hurts to ask for a discount.

Long-term care insurance questions

What is long-term care?
When most people think of long-term care, they think of nursing homes. However, long-term care describes a variety of services, including assisted living centers where people live relatively independently with medical care nearby.
  • Adult day service centers: Adult day service centers operate during regular business hours and are available for temporary care. Adult day care centers are very common and generally focus on one of three things: social interaction, providing medical care or Alzheimer’s care.
  • Residential care facilities: Residential care facilities are 24-hour elderly care homes with varying levels of supervision that range from simple daily checks to full activity monitoring. Types of residential care facilities include independent living apartments, assisted living programs, life care communities, nursing homes and skilled nursing facilities.
  • At-home care: Some of us don’t want to leave our homes. In these cases, long-term care insurance can pay for assistance at home, including skilled nursing, occupational or physical therapy, meal preparation and housekeeping.
  • Respite care: Respite care provides a way for a primary caregiver to take a break from caring for their loved ones, whether that be for a few hours a day or a few weeks for a vacation. For more information, check out our article on respite care.
Does Medicare cover long-term care?
Unfortunately, Medicare doesn’t cover most long-term care services. Medicare is intended to cover medical costs and does not typically pay for personal care or custodial services. Unlike Medicare, long-term care insurance pays for care related to nonmedical needs.
When should you buy long-term care insurance?
Most people start shopping for long-term care insurance between their 40s and 60s. Premium rates go up the longer you wait to apply, and you may not qualify for long-term care insurance if you have a preexisting condition like Alzheimer’s disease, ALS (Lou Gehrig’s disease), Parkinson’s disease and some cancers. Getting long-term care insurance when you’re younger helps protect your savings and gives you more choices for care when the time comes.

However, most people don’t file a long-term care claim until their 70s. The best time for you to buy long-term care insurance depends on the rate you want and when you expect to make a claim. When the time is right, here are a few tips for buying long-term care insurance:

  • Read the plan closely: Before choosing a policy, read all the documentation. One plan might include in-home care, while others only cover assisted living or nursing home facilities. For more information, read about the difference between assisted living vs. nursing home vs. home care.
  • Check for exclusions: Some policies might exclude coverage in certain situations. For example, they might not cover nursing care for someone suffering from emphysema if the policyholder failed to disclose a smoking habit.
  • Upgrade if necessary: With long-term care insurance, there may be maximum lifetime benefits or daily limits. It's important to determine the total amount of coverage you need and the cost of care in your area. If you need additional coverage, ask about policy add-ons.
  • Check for partnership plans: Most states have a partnership plan with at least one long-term care insurance company. Check with your state’s insurance department to find out if your state has a program that encourages people to plan for long-term care.
Who sells long-term care insurance?
Long-term care insurance is sold through your employer or an agent. You can usually get group discounts when you buy long-term care insurance through an employer. However, agents typically provide more flexible policies customized to your needs and budget.

There were hundreds of long-term care insurers in the 1990s, but many stopped selling these policies during the 2008 recession. Since then, the market has grown again, and consumers have more long-term care insurance options.

Is long-term care insurance worth it?
Long-term care insurance is worth it because it protects your family from the financial, emotional and physical cost of caregiving. Long-term care insurance should be part of most people’s financial plan. Long-term care planning is stressful because it’s almost impossible to predict your future expenses, and insurance helps protect your financial health if things end up going downhill.

Author reviews for long-term care insurance providers

GoldenCare

GoldenCare is a long-term care insurance broker. It operates in all 50 states and offers critical care insurance, life insurance, annuities and prescription drug plans.

Read more about GoldenCare
ACSIA Partners

ACSIA is a nationwide distributor of long-term care insurance products. The provider network includes Med America, Transamerica Life Insurance, Sun Life Assurance Company and more.

Read more about ACSIA Partners
GuideOne Insurance

GuideOne's agents are trained to find customers the best carrier for life and long-term care insurance. The firm also provides additional types of insurance so clients can streamline multiple insurance needs through one company.

Read more about GuideOne Insurance
Transamerica Long Term Care Insurance

Transamerica offers a variety of life insurance and products for retirement solutions, mutual funds, annuities and employee benefits.

Read more about Transamerica Long Term Care Insurance
Bankers Life & Casualty Long-Term Care Insurance

Bankers Life & Casualty offers a complete range of coverage packages for the elderly, including Medicare supplement insurance, supplemental health insurance, life insurance, annuities and long-term care insurance.

Read more about Bankers Life & Casualty Long-Term Care Insurance
John Hancock Long-Term Care Insurance

John Hancock insures more than 3.5 million policyholders, paying out $2.3 billion each year in claims. The company currently only accepts new policies for federal employees.

Read more about John Hancock Long-Term Care Insurance
Mutual of Omaha Long Term Care Insurance

Mutual of Omaha offers customizable insurance products, including life, long-term care, disability and Medicare supplements.

Read more about Mutual of Omaha Long Term Care Insurance
MedAmerica

Founded in 1979, this New York- and Florida-based company has paid out more than $614 million in claims.

Read more about MedAmerica
Genworth Long Term Care

Genworth shows clients a cost comparison for long-term care insurance and the predicted cost of care in their area so they can be sure they're getting enough coverage.

Read more about Genworth Long Term Care
LTC Consumer

 LTC Consumer is one of the nation’s oldest and largest LTC planning firms in the country. The company connects individuals with its exclusive group of professional, licensed LTC specialists. The company works for the consumer, not the insurance companies, to find the best coverage at the lowest price. Find cost maps, resources and long-term care insurance quotes on their website.

Read 204 Reviews
OneAmerica

OneAmerica offers life insurance and annuities that provide long-term care benefits if needed. Long-term care insurance riders are underwritten by The State Life Insurance Company.

  • Life insurance: Life insurance with long-term care riders can help pay for in-home care, facility care or other long-term care services. If you never need care, you can get the cash value back or make a death benefit as part of your financial legacy.
  • Fixed annuities: Annuities with long-term care benefits can provide coverage for care expenses. Optional coverage extensions are available for an additional cost.
  • Benefit eligibility: To be eligible for long-term care benefits, clients must be chronically ill with qualified long-term care services provided.
  • Unique Benefits: OneAmerica is one of the few companies that offers lifetime unlimited benefits. It also allows qualified IRA money and cash value life insurance to be used to pay for LTC insurance.
  • Limited availability: OneAmerica long-term care solutions may not be available in all states.
Lincoln Financial Group

Lincoln Financial Group provides tools and resources to determine how much life insurance you need and if your savings will last.

  • Life insurance: The company offers term life, universal life and variable universal life insurance policies. It specializes in plans that protect your assets and living benefits.
  • Protected assets and annuities: Lincoln Financial Group has plans that protect growth and income after retirement. It offers fixed and variable annuities.
  • Employee benefits: Lincoln Financial Group offers nonmedical employee benefits, including term life insurance, short- and long-term disability, nursing home insurance, dental insurance, critical illness insurance, accident insurance and vision insurance. Customers can get discounted group rates and payroll deduction.
  • Long-term care planning: The company offers flexible retirement planning options for those 40 and older. Customers can select from hybrid long-term care solutions and Moneyguard packages.

Compare Top Long-term Care Insurance Companies

by Matthew Brodsky Insurance Contributing Editor

Matthew Brodsky is an established expert on insurance, having written hundreds of articles and other pieces of content on the subject, interviewed countless practitioners, and attended dozens of conferences and events. He served as an editor at industry magazine Risk & Insurance for six years.

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