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What Does Long-Term Care Insurance Cover?

Quick Answer

Today, Long-Term Care Insurance is comprehensive, covering all types of care options, including in-home care. There are more choices today than ever before.
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Detailed Answer

Decades ago, the only thing long-term care insurance covered was care in a nursing home. Few people wanted to go into a nursing home, but at that time, most long-term health care was delivered in a facility.

With the first wave of the baby boomers aging, more of them required long-term health care and large numbers. These baby boomers wanted other choices for extended health care.

Assisted Living

To meet the demand for other care options, assisted living facilities were being built in larger numbers. The first modern assisted living facility as we know them today was opening in 1981 in Portland, Oregon. Demand for better long-term health care made this option more appealing than conventional nursing home care.

Adult Day Care Centers

The first adult day care center opened in 1970, but it wasn't until the mid-1990s that they started taking hold. These centers allowed people to stay in their homes at night, but the care recipient was dropped off during the day to receive the help and attention they required.

Memory Care

Stand-alone memory care facilities grew substantially in the early 2000s. With the increased number of people with dementia, these centers focused their care on those with cognitive problems. The staff is trained on how to take care of the needs of people with Alzheimer's and other types of dementia. 

In-Home Care and Hospice Care

Home Health and Hospice Care have their roots all the way back to 1883 with the founding of the Good Cheer Society. Home health agencies started to become common in the 1980s and have expanded dramatically through today.

Most Long-Term Care Insurance will also provide respite care, rahab facilities, and some equipment expenses.

Families Unable to be Caregivers - More Insurance Options Needed

With greater demand for long-term health care and more families unable to provide the necessary care at home, the need for more choice in long-term health care demanded insurance options that paid for the other available options. 

Starting in the late 90s, Long-Term Care Insurance became more comprehensive. They were called 'integrated plans as they covered all areas of care in all settings, including home care, adult day care centers, assisted living facilities, memory care facilities, and traditional nursing homes. 

There are more choices available today than ever before to plan for the future costs and burdens associated with aging and changing health. While few insurance companies offer solutions, there are many to choose from and various types of available plans. Almost all of these available options are comprehensive. 

Most LTC Insurance is Comprehensive

Most consumers still purchased traditional comprehensive Long-Term Care Insurance. Traditional plans will pay benefits for all types of care once you meet the standardized benefit trigger as required by Section 7702B of the Internal Revenue Code - Are All Long-Term Care Insurance Policies the Same? | LTC News.

Partnership Long-Term Care Insurance is only offered when you own a qualified traditional policy - What is a Long-Term Care Partnership Policy? | LTC News.

Asset-based plans - known as "hybrid" plans, offer a combination of life insurance or annuities with a rider for long-term care services. These policies are also comprehensive and cover all types of long-term health care services in addition to a death benefit. 

However, be careful. Not all these plans meet federal guidelines and only consider a policy that meets the rules under Section 7702B of the IRS Code. 

Limited duration or short-term policies are not considered Long-Term Care Insurance; however, they usually use the same benefit triggers, and the benefits are tax-free. 

These plans usually provide one or two years of benefits and sometimes only cover facilities or only in-home care. They are designed for individuals who have health issues, making them unable to purchase other types of policies or who are older and out of the age range for traditional plans. 

Today Consumers Have Choice

Unlike the old nursing home insurance of the past, most solutions for long-term health care are fully comprehensive, allowing you and your family to choose the type of care and the setting once you qualify for benefits. 

Most Long-Term Care Insurance claims start with in-home care - Long-Term Care Insurance Delivers Care at Home | LTC News. You and your family remain in control. Not only will you safeguard your income and assets from the high costs of long-term health care, but you also get to enjoy the choice of how that care gets delivered to you. Plus, your loved ones get the time to be family instead of caregivers. 

Since there are so many available options and insurance companies to choose from, be sure to get expert help and assistance. Each insurance company has various options and underwriting guidelines, and premiums can vary dramatically. 

An experienced and licensed Long-Term Care Insurance specialist who represents the major companies can help match you with the best available options - Work With a Specialist | LTC News.

Health Insurance and Medicare Pay Limited Amount for Long-Term Care

Many families find out, when it is too late, that health insurance and Medicare (including supplements) pay little or nothing toward long-term health care services and supports.

Generally, health insurance and Medicare pay nothing toward custodial long-term health care services (which most people require) and for a limited amount of skilled care services.

Medicare will cover skilled services for a short period of time only if:

  • The individual must have been an inpatient of a hospital facility for a minimum of three consecutive days. OR
  • Within 30 days of that hospital stay, the individual was admitted to a Medicare-certified skilled nursing facility AND
  • The person requires skilled nursing, physical therapy, or other skilled therapy and rehab services as prescribed by a doctor.

Medicare will pay up to 20 days, and the supplement will pay days 21 through 100.

This coverage is not once in a lifetime but once per diagnosis. 


Medicaid will only pay for long-term health care if the individual has little or no income and assets. Some states have expanded Medicaid to allow some community and home-based care; however, most Medicaid benefits are for nursing home care, and Medicaid approved providers must be used. 

Cost of Long-Term Care Varies Depending on Type and Location

Long-term health care costs are expensive and grow yearly. However, depending on the type of care you require, and where you live, the costs vary tremendously.

The LTC NEWS Cost of Care Calculator can show you the costs of all types of care services throughout the country - not just by state - but based on location within a state - Cost of Care Calculator - Choose Your State | LTC News.

Growing demand for long-term care services and higher labor costs will increase the costs in the decades ahead. Most Long-Term Care Insurance policies offer inflation benefits, so your benefits increase over time, usually without an increase in your premium.

Tax Benefits

When you own a Long-Term Care policy, several tax benefits may help you purchase even more coverage and provide more complete asset protection - Long-Term Care Tax Benefits Guide | LTC News.


One option you have is whether to purchase a Partnership Long-Term Care Insurance policy. If you do, you obtain additional dollar-for-dollar asset protection - What is a Long-Term Care Partnership Policy? | LTC News.

Costs of LTC Insurance 

Once you understand how a policy works and what it covers, you research the current and future cost of care where you live or expect to live in the future. The LTC NEWS Cost of Care Calculator, as noted above, helps in your research. 

The cost of Long-Term Care Insurance depends on several things, including which insurance company you use. Insurance premiums are regulated, and every insurance company must file their rates for approval with every state's insurance department.

The premium you will pay depends on several factors, including:

  • Age and Health: Your age and health when you apply are key in determining your premium. If you are older and have significant health problems, you will pay more than someone in good health and is younger - i.e., in your 40s or 50s, which is when most people obtain coverage.
  • Gender: Women generally pay more than men because they live longer and thrive in a care environment longer than men do.
  • Marital/Partner status: Premiums are lower for married or partnered individuals than people who live alone.
  • Choice of Insurance Company: Prices for the same amount of coverage will vary among insurance companies over 100%. Working with a  specialist who can shop the top companies will help you find the best coverage at the best value.
  • Amount of Coverage: The more benefits in your plan - the more expensive it will be. A specialist can help you decide the amount of coverage best for you - but you get to decide on the total amount of benefit. Some people just want a little help, and others want complete asset protection.

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  • Has substantial experience in Long-Term Care Insurance
  • Strong understanding of underwriting, policy design, and claims experience
  • Represents all or most of all the leading insurance companies

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Work With A Trusted Specialist

  • Has substantial experience in Long-Term Care Insurance
  • Strong understanding of underwriting, policy design, and claims experience
  • Represents all or most of all the leading insurance companies
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