Long-term care insurance is worth it for many middle-income families who want to protect their savings and choose their own care. It’s usually not worth it if you can comfortably pay for care yourself, or if your savings are low enough that Medicaid would cover you. Whether it makes sense for you depends on your age, health, assets, family support and how much premium risk you can live with.
This guide lays out the numbers: what a policy costs in 2026, what long-term care itself costs, how likely you are to need it, why premiums on older policies have jumped, the tax breaks, and the alternatives worth comparing before you buy.
- Chance you’ll need care: almost 70% of people turning 65 will need some long-term care, and 20% will need it for more than five years (ACL).
- What care costs: about $74,400 a year for assisted living and $129,575 for a private nursing home room (CareScout 2025 medians).
- What a policy costs: about $5,010 a year for a couple aged 55 and about $7,030 for a couple aged 65 (AALTCI 2026, with 3% compound inflation protection).
- Medicare does not pay for ongoing custodial care, so the bill falls on you, a policy, or Medicaid once your savings run low.
- Biggest risk: premiums on traditional policies can rise. Some older policyholders have seen increases of 50% or more.
What long-term care insurance covers
Long-term care insurance pays for help with everyday living when you can no longer manage on your own. That includes help with bathing, dressing, eating, toileting, moving around, and supervision for someone with dementia. Most policies pay for care in any of these settings:
- In-home care from an aide or agency (see in-home care costs)
- Adult day care and respite care
- Assisted living and memory care
- Nursing home care
Benefits usually start when a licensed health professional certifies that you need help with at least two of six “activities of daily living,” or that you need substantial supervision because of cognitive impairment such as Alzheimer’s. Most policies also have an elimination period, a waiting period (often 90 days) during which you pay for care yourself before benefits begin.
Why you can’t rely on Medicare
Medicare covers short-term skilled care after a hospital stay, not ongoing help with daily living. In a skilled nursing facility it pays in full for only the first 20 days and stops entirely after day 100. Our guide to Medicare’s 100-day rule explains the details. For most families, the realistic payers for long-term care are their own savings, a long-term care policy, VA benefits for veterans, or Medicaid.
How likely are you to need long-term care?
Government figures from the Administration for Community Living (ACL) show how common, and how uneven, the risk is:
- Almost 70% of people turning 65 will need some type of long-term care.
- About one-third may never need any.
- 20% will need care for longer than five years.
- Women need care for 3.7 years on average, compared with 2.2 years for men.
- 65% use some care at home (about two years on average); 37% use care in a facility (about one year on average).
That uneven spread is the core of the decision. Many people need a modest amount of care that savings can handle. A minority need many years of expensive care, and that tail risk is what insurance is designed to cover.
What long-term care costs in 2026
The CareScout Cost of Care Survey (formerly Genworth) is the standard national benchmark. Its latest national medians, collected in 2025 and published in March 2026, are below.
| Type of care | National median | Per year | 3 years of care |
|---|---|---|---|
| In-home care (non-medical caregiver) | $35/hour | $80,080 (44 hrs/week) | ~$240,000 |
| Adult day health care | $95/day | $24,700 (5 days/week) | ~$74,100 |
| Assisted living | ~$6,200/month | $74,400 | ~$223,200 |
| Nursing home, semi-private room | $315/day | $114,975 | ~$344,900 |
| Nursing home, private room | $355/day | $129,575 | ~$388,700 |
Source: CareScout Cost of Care Survey 2025, national medians. Three-year totals are today’s prices with no inflation, so real future costs will be higher. Costs vary widely by state.
See our state-by-state guides to assisted living costs, memory care costs and nursing home costs.
How much does long-term care insurance cost?
The American Association for Long-Term Care Insurance (AALTCI) publishes an annual price index. Its 2026 figures for traditional policies:
| Who’s buying | Approx. annual premium (2026) | Notes |
|---|---|---|
| Couple, both age 55 | ~$5,010 | $165,000 initial benefits, 3% compound inflation protection |
| Single woman, age 60 | ~$4,450 (average) | Comparable protection |
| Couple, both age 60 (Illinois) | $4,591 to $7,173 | Identical benefits; the priciest insurer charged 56%+ more than the cheapest |
| Couple, both age 65 | ~$7,030 | Comparable coverage, 3% compound inflation protection |
Source: AALTCI 2026 Long-Term Care Insurance Price Index (as reported). Your premium depends on age, health, state, benefit design and the insurer.
Two things stand out. First, waiting costs money: the same couple pays about 40% more at 65 than at 55, and health problems that develop in the meantime can make you ineligible. Second, prices for the same coverage vary by thousands of dollars between insurers, so getting several quotes matters more than for most insurance.
A worked example
Say a couple buys at 55 and pays about $5,010 a year. If premiums never rose, 20 years of premiums would total roughly $100,200. With 3% compound inflation protection, their $165,000 benefit pool would grow to roughly $298,000 by the time they’re 75. That’s about the cost of three years of semi-private nursing home care at today’s prices. If neither of them ever claims, a traditional policy pays nothing back. If one needs several years of facility care, the policy pays back many times the premiums. Insurance trades a known, steady cost for protection against an expensive outcome you can’t predict.
The pros of long-term care insurance
- Protects your savings and home. A long stay in a nursing home can use up a lifetime of savings in a few years.
- More choice of care. Policies pay for home care and assisted living, not just nursing homes. Medicaid’s options are narrower and often have waitlists.
- Takes pressure off family. Paid care means a spouse or adult children don’t have to become full-time caregivers.
- Tax advantages. Part of your premium may be tax-deductible, and benefits from tax-qualified policies are generally tax-free (see below).
- Medicaid asset protection in Partnership states. A Partnership-qualified policy lets you keep extra assets if you ever need Medicaid.
The cons, and the risks to understand
- Premiums can rise. Insurers can’t single you out, but they can raise rates for a whole class of policyholders with state approval. In 2025, Maine regulators approved Genworth increases as high as 99% on some older policies, phased in over up to three years. A 2026 CT Mirror investigation found nearly 100,000 Connecticut policyholders hit by increases that often exceeded 50%.
- “Use it or lose it.” With a traditional policy, if you never need care you get nothing back. About one-third of 65-year-olds never will.
- Underwriting. You must qualify medically. A diagnosis like dementia, a recent stroke or serious mobility problems can mean you’re declined, which is a reason not to wait too long.
- Benefits are capped. Most new policies pay a set daily or monthly amount up to a total pool (often two to four years of care). A very long need can outlast the policy.
- Lapse risk. If premiums become unaffordable in your 80s and you drop the policy, you lose the protection just as you’re most likely to need it. Many policies offer a reduced “paid-up” benefit instead. Ask about this before you buy.
Who long-term care insurance is usually worth it for
There’s no single cut-off, but financial planners tend to group people like this:
| Your situation | Is it worth it? | Why |
|---|---|---|
| Modest savings, little income beyond Social Security | Usually not | Premiums would strain your budget, and Medicaid is likely to pay for long-term care after a short spend-down. |
| Middle-class assets: a paid-off home, solid retirement savings, comfortable income | Often yes | This is the group with the most to lose: too much to qualify for Medicaid quickly, not enough to pay $100,000+ a year for several years without hurting a surviving spouse. |
| Married couple who want to protect the at-home spouse | Often yes | Paying for one spouse’s care can drain the savings the other spouse needs to live on. |
| Wealthy, with assets that could easily cover several years of care | Optional | You can “self-insure.” Some still buy coverage to protect an inheritance or for peace of mind. |
| Single with no family nearby to help | Leans yes | Without unpaid family help, you’re more likely to need paid care, and to need it sooner. |
| Already age 70+ or with significant health conditions | Harder to get | Premiums are high and you may not qualify. Look at the alternatives below. |
A useful test is to ask: if I needed five years of nursing home care starting at 80, could I pay for it and still leave my spouse (or my plans for my estate) in good shape? If the answer is clearly yes or clearly no, insurance matters less. If the honest answer is “it would wipe us out,” it deserves a serious look.
Is long-term care insurance tax deductible?
Partly. For a tax-qualified policy, premiums count as a medical expense up to an age-based limit. For 2026 the limits per person are:
| Age at end of 2026 | Maximum deductible premium |
|---|---|
| 40 or under | $500 |
| 41–50 | $930 |
| 51–60 | $1,860 |
| 61–70 | $4,960 |
| 71 and older | $6,200 |
- If you itemize, those amounts count toward medical expenses, which are deductible only above 7.5% of your adjusted gross income.
- Self-employed people can usually deduct the eligible amount directly, without itemizing.
- You can pay eligible premiums tax-free from a Health Savings Account (HSA), up to the same limits.
- Benefits are generally tax-free. For “per diem” policies that pay a flat daily amount, the 2026 tax-free limit is $430 per day; more than that is taxable only if it exceeds your actual care costs.
- Many states offer their own deduction or credit too.
Tax rules have conditions, so check with a tax professional.
Partnership policies: extra protection if you ever need Medicaid
Most states run a Long-Term Care Partnership Program. If you buy a state-approved Partnership policy and later use up its benefits, you can keep extra assets and still qualify for Medicaid, dollar for dollar. For example, if your policy paid $150,000 in benefits and your state normally lets a single person keep $2,000, you could keep $152,000 and still qualify for Medicaid.
Partnership policies must include inflation protection, and the asset protection generally applies only in your own state or in states that have a reciprocity agreement with it. Ask any agent whether a policy is Partnership-qualified. If you’re unsure how Medicaid’s asset rules work, read does Medicaid pay for nursing home care?
Alternatives to traditional long-term care insurance
Hybrid life / long-term care policies
These combine life insurance (or an annuity) with long-term care benefits. If you need care, the policy pays for it; if you don’t, your heirs get a death benefit, and many policies return some or all of the premium if you cancel. They’re often paid with a single lump sum or over a fixed number of years, and their premiums are usually guaranteed not to rise. The trade-off is a higher upfront cost for a given amount of care coverage.
Life insurance with a long-term care or chronic illness rider
A rider lets you draw down part of the death benefit early if you need care. It’s cheaper than a full hybrid, but the care benefit is smaller and the rules for qualifying vary, so read the definitions closely.
Annuities with long-term care benefits
Some annuities multiply the payout if you need care. They can suit people with savings to reposition who may not qualify medically for traditional coverage.
Short-term care insurance
These policies cover up to about a year of care, with easier medical underwriting and lower premiums. They suit people who’ve been declined for long-term care insurance or who want to cover a shorter need.
Self-funding
If your savings could pay for several years of care, you can earmark part of them as a long-term care fund. Your home equity counts too, through a sale, downsizing, or a reverse mortgage, though using it reduces what you leave behind.
Public programs
- Medicaid pays for nursing home care, and in many states home care and assisted living, once your income and assets are low enough. See our guide to Medicaid and assisted living.
- VA benefits such as Aid and Attendance can help eligible veterans and surviving spouses pay for care.
- Washington State’s WA Cares Fund began paying benefits in July 2026: up to $36,500 over a lifetime (2026 amount, indexed to inflation) for eligible workers who paid in.
Short on money already? Our guide to paying for assisted living with no money covers the programs that help.
If you decide to buy: 8 tips for getting it right
- Look in your 50s to early 60s. Premiums are lower and you’re more likely to pass underwriting.
- Get quotes from several insurers. AALTCI found a 56%+ price gap for identical coverage.
- Include inflation protection. Care costs keep rising. A policy bought at 55 might not pay out for 25 years.
- Pick a realistic benefit. Compare the daily or monthly benefit with care costs where you plan to live, and consider covering part of the cost rather than all of it to keep premiums manageable.
- Check the insurer’s rate-increase history with your state insurance department before buying.
- Couples: ask about shared care. It lets one spouse use the other’s unused benefits.
- Choose a Partnership-qualified policy if your state offers one.
- Understand the elimination period. A 90-day wait lowers premiums, but you’ll need savings to cover those first months.
Consider an independent agent who sells for several insurers, or a fee-only financial planner who doesn’t earn commission. Your State Health Insurance Assistance Program (SHIP) also offers free, unbiased counseling.
The bottom line
Long-term care insurance is worth it when the cost of a long care need would seriously damage your finances or a spouse’s security, and when you can afford the premium today and a possible increase later. If you have modest savings, Medicaid is the more realistic safety net. If you’re wealthy, self-funding may be enough. For everyone in between, the decision deserves real numbers: get quotes, compare them against what care costs in your area, and weigh a traditional policy against a hybrid.
When the time comes to choose care, our senior care directory lists assisted living, memory care and in-home care providers near you.
This article is general information, not financial, legal or tax advice. Talk to a licensed professional about your situation.
Long-term care insurance FAQs
Is long-term care insurance worth it at 70?
It can be, but it’s harder. Premiums at 70 are much higher than at 55–65, and more applicants are turned down on health grounds. Many people in their 70s look at short-term care insurance, an annuity with long-term care benefits, or setting aside savings instead.
Does Medicare cover long-term care?
No. Medicare covers short-term skilled nursing or rehab after a qualifying hospital stay, up to 100 days per benefit period. It doesn’t pay for ongoing custodial care in a nursing home, assisted living or at home.
What happens if I never use my long-term care insurance?
With a traditional policy, the premiums are gone, much like home insurance on a house that never burns down. Some policies offer a return-of-premium rider at extra cost. Hybrid life/long-term care policies pay a death benefit to your heirs if you never claim.
Can long-term care insurance premiums go up?
Yes, for traditional policies. Insurers can raise rates for a whole class of policyholders with state approval, and some older policies have seen increases of 50% or more. Hybrid policies usually have guaranteed premiums.
What is the best age to buy long-term care insurance?
Most people who buy do so in their mid-50s to mid-60s. Premiums are still moderate at that age and you’re more likely to qualify medically. AALTCI’s 2026 figures show a couple paying about $5,010 a year at 55 versus about $7,030 at 65.
Is long-term care insurance tax deductible?
Premiums for tax-qualified policies are deductible as a medical expense up to age-based limits ($1,860 at ages 51–60 and $4,960 at 61–70 in 2026), and can be paid from an HSA. Benefits are generally tax-free.
What are the alternatives to long-term care insurance?
Hybrid life/long-term care policies, life insurance with a long-term care rider, annuities with care benefits, short-term care insurance, self-funding from savings or home equity, and public programs such as Medicaid and VA benefits.
Sources
- Administration for Community Living: How Much Care Will You Need?
- CareScout Cost of Care Survey 2025 results
- American Association for Long-Term Care Insurance: 2026 Price Index findings
- Maine Bureau of Insurance: Genworth long-term care rate decisions (July 2025)
- CT Mirror: “Priced Out” (April 2026)
- ElderLawAnswers: 2026 long-term care premium deduction limits
- WA Cares Fund: Benefits
