Almost 70% of people turning age 65 today will need some type of long-term care in the future. The average length of time people need care is 3 years.1
One-third of people may never need long-term care, but 20% will need it for longer than 5 years. On average women need 3.7 years of care while men need 2.2 years.2
In 2022, the average cost for 3 years of long-term care in California was $438,000 ($146,000 per year). That cost is projected to be $791,076 ($263,692 per year) in 2042.3
Does Medicare Cover Long-Term Care?
No, Medicare does not cover long-term care (custodial care). This type of care makes up more than 90% of all long-term care services. Examples of custodial care is when you need help with walking, bathing, eating, dressing or using the toilet. This is what people need most when they have a physical impairment from a stroke. Or, due to cognitive impairment from dementia or Alzheimer’s disease. Don’t make the mistake of thinking Medicare covers long-term care costs. It doesn’t.
Further, about 80% of care at home is provided by unpaid caregivers. With more than half of this care including intensive caregiving assistance with personal care such as bathing or feeding.4 And it’s not only seniors that need long-term care. Over 35 percent of people currently receiving care are between the ages of 18 and 64.5
When To Buy Long-Term Care Insurance
Like most advisors, we recommend buying long-term care insurance in your fifties or early sixties for the following reasons:
The younger you are when you buy a policy, the lower the annual premiums.
Even though you pay premiums a longer period of time, you’ll typically pay less overall than someone buying at an older age.
By the time you reach your mid sixties, you’re more likely to have a medical condition that makes you ineligible for a preferred-health discount, or makes it tough to get coverage at all.
So it almost never pays to wait. And, while you’re waiting, you’re uninsured. If an accident or illness happens causing you to need long-term care, you’ll have to pay out of pocket.
Traditional LTC, Hybrid Life LTC, and Hybrid Annuity LTC are the three most commonly chosen long-term care insurance plans in California. Another option is Short-Term Care, which is most often chosen because of health or age limitations.
Traditional Long-Term Care Insurance
The most comprehensive long-term care protection for your dollar
About half of all long-term care policies purchased, including California Long-Term Care Partnership policies
California Partnership for Long-Term Care policies combine private long-term care insurance with Medicaid (Medi-Cal) asset protection. Only Partnership policies provide this type of asset protection when you need nursing home, assisted living or home care.
The unique asset protection benefits of a California Partnership for Long-Term Care policy apply if your long-term care needs last longer than the benefits of your Partnership policy. For example, for every dollar your California Partnership for LTC policy pays in benefits, a dollar of assets is protected from the long-term care Medicaid (Medi-Cal) asset limit. The protected assets are also exempt from Estate Recovery in the same amount as the benefits paid by your Partnership policy.
Even though California Partnership for Long-Term Care rates are like regular policies, we recommend comparing them with non-Partnership policies. Because, non-Partnership policies may have options better suited to your needs. This includes Hybrid Long-Term Care Insurance plans not available under the California Partnership for Long-Term Care.
NOTE: As of the date of this writing, no insurance companies are currently offering LTC Partnership qualified products in California. This means you cannot buy a California Partnership for Long-Term Care policy at this time. This does not affect current, active insureds who are Partnership qualified.
Traditional non-Partnership and Hybrid Long-Term Care Insurance plans are available.
California does NOT participate in the national reciprocity agreement.
In states with Reciprocity, you can buy a qualifying Partnership for Long-Term Care policy in one state and maintain the special asset protection benefit when you move to another state with reciprocity. Your new state would recognize accumulated asset protection for Medicaid qualification if you’re already receiving benefits from your LTC Partnership policy before moving. The majority of states have Partnership Reciprocity and California is one of the exceptions.
How Much Does LTC Insurance Cost in California?
Your California long-term care insurance rates will depend on your age, health history, plan design and type of coverage selected. The following choices let you choose how much protection is right for your situation:
California long-term care insurance is available from several highly rated insurance companies. We compare these carriers to find you the right plan at the lowest cost. Here is a list of long-term care insurance providers in California:
Long-term care is the assistance needed when a person is unable to manage their own personal care needs or when they need help with daily activities (walking, bathing, continence, dressing, eating, toileting and transferring). This type of care is known as Custodial Care and is not covered by Medicare.
How much does long-term care insurance cost?
For most people, long-term care insurance is affordable. However, several factors impact the cost of a policy, including your age, health, and policy design. The typical annual premium is much less than paying for one month of long-term care services out of your pocket.
What disqualifies me from long-term care insurance?
Your health status and age determines your eligibility for long-term care insurance. But even people with significant health conditions may still qualify. Conditions like Alzheimer’s, Parkinson’s, or currently needing care could disqualify you. Short-term care insurance may be a good option for those at older ages or with certain health issues.
What is the best long-term care insurance?
There are many plan options and highly rated carriers available. The best plan is from a highly rated insurance company with the right set of benefits for your needs.
How to buy long-term care insurance?
Your best source is from a Long-Term Care Advisor with substantial experience in LTC insurance underwriting, policy design, and claims. A licensed professional who represents several companies can find you the best coverage at the best value.
Some people turn to their financial advisor for long-term health care planning, but this is not their core competency. Many only work with one or two companies and have limited experience with the features and benefits of these products. Also, most have never filed a long-term care claim and don’t understand the process. As a result, many financial advisors partner with us to ensure their clients get the best service.
What Our Customers Say
If you are shopping for long-term care insurance, then I strongly recommend that you contact Craig Matesky… More at ACACIA Insurance Services. Craig helped me get the best policy for my needs and budget. He is knowledgeable, friendly, and was always available to address my concerns. Thanks Craig!
I have had the good fortune to work with Rhona Unsell in getting my LTC policy. Ms. Unsell is a true… More professional – her expertise, her ability to listen and to provide accurate information – all were so valuable to me. In making important life decisions, qualities like trust, knowledge, and the understanding of how to listen to a client’s needs are critical. Rhona has all these qualities and more. I strongly recommend Ms. Unsell to anyone looking for excellent ongoing service and a caring attitude.
With the new long term care laws passed in Washington State, I was in the market for private LTC insurance.… More I worked with Michael Berger and I was blown away with how hard he worked to get me a plan that met my needs. As the market changed during this process, he was always the first on the phone explaining options and walking through what's next. I was able to get a great plan, at a great price, and can't recommend him and this group enough!
My wife and I had a teleconference with Marcia, a Long Term Care Planning Specialist with Acacia Insurance… More Services.Marcia was very knowledgeable, personable, and entertaining during our 1.5 hour meeting. To be honest, the meeting did not seem that long at all as Marcia kept the ball rolling by going over various options for LTC.We feel like we lucked out getting her as our contact.Well done, Marcia!
Marcia is among the best insurance brokers I've ever encountered. She's intuitive, understanding,… More conscientious, and always concerned first for the client. She found the best policy for me, assisted me through the application process, smoothed out the inevitable wrinkles, and always followed up like the new friend she is. I recommend her highly.
Our decision to buy long term care insurance was a smart one. My husband received home care benefits… More for over three years before he passed away. Now I've been getting home health care paid by the policy for almost two years. It has greatly reduced the burden on our family and our savings. We are so grateful for the ACACIA Insurance agent that sold us our long term care policies and assisted us with the claims process.
1. “How Much Care Will You Need?” LongTermCare.gov, U.S. Department of Health and Human Services, site accessed 6/26/2023 2. “How Much Care Will You Need?” LongTermCare.gov 3. Cost of Care Survey 2021 Genworth.com, site accessed 6/26/2023 4. “Who Will Provide Your Care?” LongTermCare.gov 5. Family Caregiver Alliance Caregiver.org, site accessed 6/26/2023 Please note: Coverages and other features vary between insurers, vary by state, and are not available in all states.