Long Term Care Planning

The Complete Guide to Long Term Care Planning [2023]

The Complete Guide to Long Term Care Planning [2023]

In this article

— Last Updated May 27, 2022

Read Time
7 mins
Reviewed by
Eric Berkman

Guide The Complete Guide to Long Term Care Planning [2023]

— Last Updated May 27, 2022

Stephanie Wilson

Director of Operations


Reviewed by

Eric Berkman

Long term care refers to getting help with activities of daily living like bathing, eating, using bathroom and other normal daily activities that people typically are able to do for themselves. It’s a blessing if you are enjoying good health today but you don’t know what the future holds. It is crucial to set up a plan for when you may need help with care, typically later in life. 

Long term care planning allows you to protect yourself and get the care you need when you need it, and where you need it.  Long term care insurance is a product that you can purchase so you are able to have benefits to pay for long term care.  Long term care coverage can pay for the help you’ll need if you are typically experiencing issues 2 more activities of daily living. Long term care insurance helps in pay for those costs, regardless of if they are administered in your home of a facility. Keep reading to learn what long term care planning is?

A General Outlook on Long-Term Insurance

To get a better understanding of long term care planning it is important to learn about its roots. Here is an outlook of how long term care insurance came out.

When Did Long Term Care Planning First Appear?

The trend of nursing homes came into being in the middle of the 1960s for those who needed long term care when family members were unable to provide help.  But not all people were able to pay for this type of care and many of them had to sell their properties in order to get the necessary help to pay for their activities of daily living assistance, so a greater need arose for this specialized type of insurance plan. By the end of the 1970s, there were a number of long term care insurance plans offered across the country.

The Rise and Fall of Long Term Care Policies

In the 1980s it was common to have a long term care policy and private companies were selling them as part of their health & life suite of insurance products. 

The 1990s seemed a boom in the purchase of long term care insurance and it was a common thing to have a long term care policy.

2000 was the year when insurance companies started facing a backlash due to not providing some of the benefits when claimed. People were living longer, and claims on the benefits out of their long term care insurance was on the rise. Insurance providers didn’t meet the claims as they wrongly anticipated the number of claimants and cost of healthcare being increased over time.  The cost of long term care kept increasing, and it became evident by many policyholders that their benefits were going to be denied.

How Did It Evolve to What It Is Today?

When it comes to long term care planning, boomers and retirees have to plan it differently as there is the uncertainty of entitled benefits and increase in long term care costs.

Long term care insurance is a viable option to consider for some. Within the last several years there has been a drastic evolution in insurance products regarding provided care and benefits trends. As of now, half of the long term care benefits which are paid by insurance providers are primarily for in-house and assisted living care. Whereas, before it was paid for majorly nursing homes. But it’s important to know that if you have long term care insurance, it typically will pay benefits of insurance regardless of where you receive your care.

What Is Long Term Care Planning?

70% of people 65 and older will experience a long term event in their lifetime.  And so it’s important for people to realize that long term care planning is important to do so they can have things in place when the need for care arises. While long term planning is mostly associated with care provided at nursing homes, the truth is many people choose to receive care at home.  The Older Americans Act offers many programs and support to people to stay in their homes and communities and receive necessary care but it’s important to note that not all the expenses under health care are met through these government-initiated programs.

Long term care planning involves critical decisions like:

  •         Where will I stay when I am unable to take of myself?
  •         Who will take care of me?
  •         What kind of choice will they make about my life?
  •         What about my finances and the things I leave behind?

Before you make any decision about long term care planning, talk to someone you trust. They can be:

  •         Family
  •         Health care provider
  •         A social worker
  •         A counselor
  •         A licensed long term care specialist.

Talking to a licensed insurance agent who specializes in long term care insurance is one way to help you plan for your long term care needs. At Policy Solver, we’re experts in long term care planning, and can help you make the right decision. 

Action Plan Towards Long Term Care Planning

Long term care planning should be a vital part of every financial and retirement plan written today. Here is how you can get started:

Step 1: Understand the dire need for a plan.

Step 2: Understand the existing health care system and care services at the place you are going to live when age and also what options you have to stay in your home. 

Step 3: See whom you can count on for care and support, whether it’s family and/or friends. 

 Step 4: Have a talk with your family. Brief them on your thoughts on aging and long-term planning. Consider the ailments and chronic conditions you may face as per your family history.

Step 5: Construct a legal document with a lawyer and make it aware to those it may concern. Make a clear will and powers of attorney and provide a copy to your family.

Step 6: Compile all the personal, health, legal and financial information and store it at a place for ease of access.

Step 8: Discuss the plan with family and update it on a yearly basis.

By putting together a long term care plan you will achieve two goals:

        Know where you plan to receive care

        Know how you plan to finance your care

Examples of Long Term Care Planning

Stand-Alone Long Term Care Insurance Policies

Also known as traditional long term care insurance, it provides direct and affordable paying solutions for most of the long term care expenditures. These policies will pay benefits if you:  

  1.    Need assistance in 2 – 6 ADLs i.e. dressing, bathing, feeding, toileting, transferring, and continence.
  2.   Become cognitively impaired due to the disease of Alzheimer’s.

Stand-alone Long term care Insurance Policies include these components:

        How much coverage you’ll get per month – benefits typically range from $1,500 to $12,000 per month, depending on the insurance company and the specific plan you purchase.

        How long you’ll get benefits– benefit periods range from 2 – 6 years, also depending on the insurance company.

        How long before your monthly coverage starts – this can range from 0 days up to 365 days

        Optional benefits – you can add on optional benefits as Riders.

Asset-Based Hybrid Long Term Care Insurance Plans

These policies provide features of traditional long term care insurance and life insurance combined into one policy. The hybrid policy provides a range of affordability and guaranteed benefits. You can have the same benefits of life insurance while having an added rider as LTCI. The components will be the same as the stand-alone policy. Asset-based long term care policies are only workable for only those people who have some assets to protect.

Specific details:

        One policy, two purposes – now the total value of the policy goes to both long term care insurance and life insurance.

        Your premiums are typically guaranteed not to increase.

        Flexibility in payment – you can choose to pay your premiums in a lump sum as a single payment plan, 20 annual payments as a 20 payment plan, or lifetime payments.

        Underwriting is less strict.

        Get a refund of premiums – with many plans you can cash in your policy for any reason and get back some or all of the premiums you’ve paid in.

Who Needs Long Term Care Planning?

While most of the people who need long term care are in their older ages, long term care planning applies to anyone and should be done when you’re younger and healthier so you’re prepared. People of young age can also benefit from a  long term care plan in case of sudden injury or accident.

Long Term Care Planning and Insurance Specialists

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Get in touch so we can discuss your needs, and match you with the right product and coverage to fit your budget.


What Are the Differences Between Long Term and Short Term Care Planning?

Long Term Care Planning

Long term care planning is intended for seniors and people with other chronic or progressive medical conditions.

Short Term Care Planning

Short term care planning aims at temporary medical aftercare following a surgery, illness or other medical forms that have the expectation of improvement. It’s best to inform youself on differences between short vs long term disability insurance a little more.

What Is the Cost Of Long Term Care Planning?

Planning itself doesn’t take much in terms of cost.  In fact, it’s typically free.  But, the costs of long term care are very high and increase almost every year.  According to Statista, in the year 2020, the average cost of long term care in the United States ranged from $19,240 to $105,850 depending on the type of care and where the care is administered.

The most expensive long term care service is nursing homes costing about $93,075 annually for a semi-private room. However, the cost of nursing room expenses varies from state to state, as a semi-private room in an Alaskan nursing home nearly reached $450,000 in 2020 whereas it was $132,313 in Minnesota.

At-home care services are another viable option frequently chosen as part of long term care planning. Similar to nursing room costs, the cost for in-home care services such as homemaker services varied depending on the state you are living in. In Washington DC, the annual cost for homemaker services was $71,294 in 2020.

Where Can I Find Out More and Get Advice on Long Term Care Planning?

Policy solver has knowledgeable, licensed agents, and is here to help you navigate through your long term care insurance journey. We are a team of professional insurance policy brokers and we can save you time and money while finding the right policy for your specific needs. Our experienced advisors will ask you a few questions to understand your unique situation and will come up with a comprehensive analysis of different long term care plans so they will be able to recommend the best policy at the best price for you.

Contact us or schedule a free consultation, and we will connect with you soon!



Older Americans Act, (August 7, 2021) retrieved from Administration for community living: Website: https://acl.gov/about-acl/authorizing-statutes/older-americans-act

NIH National Institute on Aging (NIA), (May 01, 2017) retrieved from National Institute on Aging Website:  https://www.nia.nih.gov/health/what-long-term-care

The annual average rate of long-term health care services in the United States as of 2020, by type retrieved from Statista Website: https://www.statista.com/statistics/310446/annual-median-rate-of-long-term-care-services-in-the-us/

U.S. states with the highest annual cost for a private or semi-private room in a nursing home facility as of 2020, retrieved from Statista Website: https://www.statista.com/statistics/310438/most-expensive-annual-cost-private-room-in-nursing-home-in-us-by-state/

U.S. states with the highest annual cost for in-home care, as of 2020 (in U.S. dollars), by cost for homemaker services, retrieved from Statista Website:https://www.statista.com/statistics/310410/most-expensive-annual-in-home-care-homemaker-services-in-us-by-state/

Stephanie Wilson


November 12, 2021

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