Long-Term Care Insurance Calculator

How to Use the LTC Calculator

Long-Term Care — The Largest Unfunded Risk in US Retirement

10 Facts About US Long-Term Care

Frequently Asked Questions

• Does Medicare pay for long-term care?+
  No, beyond a very narrow window. Medicare Part A covers up to 100 days of skilled-nursing care if you were first hospitalized for 3+ days AND require ongoing skilled medical care (NOT just custodial care like help with bathing or eating). Days 1-20 fully covered; days 21-100 require ~USD 200/day copay. After 100 days: nothing. This narrow window is the single most common Medicare misunderstanding — most retirees believe Medicare covers LTC, it doesn't.
• What's Medicaid LTC and the spend-down?+
  Medicaid is the only US public program that pays for ongoing LTC, but eligibility requires almost-no assets: typically USD 2K of countable assets (some states higher). Spouse can keep ~USD 130K + the house. To qualify, you must "spend down" assets via medical bills, home modifications, prepaid funeral, etc. Lookback period 5 years for asset transfers — gifting kids USD 100K then applying for Medicaid 4 years later triggers a penalty period. Once on Medicaid: limited facility choice, bed shortages common.
• When should I buy LTC insurance?+
  Sweet spot is ages 55-65 — premiums are still reasonable, underwriting still accepts healthy applicants. Younger means more total premium paid over the policy life; older means much higher annual premium and tighter underwriting. After age 70 many carriers won't issue; after 75 most won't. Any significant health event (cancer, stroke, early dementia) can disqualify you regardless of age — buying before such events is the standard advice.
• Traditional vs hybrid LTC — which?+
  Hybrid LTC + life is the modern preferred choice for middle-and-upper-middle income families: locked-in premium, death benefit if unused (no "wasted premium" concern), and modest LTC coverage. Traditional LTC remains cheaper per dollar of pure LTC coverage but premium can rise mid-policy and benefit is "use it or lose it". Roughly 70% of new LTC-style purchases since 2020 have been hybrids per ACLI data — driven by traditional carriers raising rates aggressively.
• Should I just self-fund LTC?+
  Reasonable if you have USD 2M+ specifically earmarked for LTC (separate from retirement spending budget). Risk: a longer-than-expected LTC episode + market downturn during care can drain the portfolio. The "1.5× expected cost" buffer is a common floor — your earmarked assets should cover roughly 4-5 years of high-cost care, not just the median 2-3 years. High-net-worth families ($5M+) routinely self-fund; middle-net-worth typically benefit from hybrid coverage.
• What about state LTC programs?+
  Washington's "WA Cares" (2023+) is the first US public LTC program: 0.58% payroll tax funds USD 36,500 lifetime LTC benefit. Useful supplement but nowhere near comprehensive. California is studying similar legislation; New York is contemplating. Don't rely on state programs as primary coverage — benefits are modest compared to actual costs, and rules can change.
• Are LTC premiums tax-deductible?+
  Federal: tax-qualified LTC premiums are deductible as medical expense (subject to 7.5% AGI threshold). Age-limited caps: USD 480 (under 40), USD 900 (40-50), USD 1,800 (50-60), USD 4,810 (60-70), USD 6,020 (70+) for 2024. State income tax: many states (AK, AR, CA, CO, FL, GA, HI, KY, ME, MD, MN, MS, MO, MT, NJ, NY, NC, OR, VA, WV, WI) offer additional state-level deductions or credits. Check your state's revenue department.
• What triggers a claim?+
  Most policies use "ADL trigger" — inability to perform 2 of 6 Activities of Daily Living (bathing, dressing, transferring, toileting, eating, continence) WITHOUT assistance. Or cognitive impairment (Alzheimer's, dementia). Elimination period (typically 90 days) must elapse before benefits start — you pay out-of-pocket during that window. Periodic re-assessment by claims doctors is standard. Claims processes vary significantly by carrier; Lincoln, Mutual of Omaha, and Northwestern Mutual generally have strong reputations.
• Can my spouse and I share a policy?+
  Yes — "shared benefits" or joint policies pool the lifetime benefit between spouses. If one spouse uses only 1 year of a 3-year benefit, the other has 5 years available (3 own + 2 transferred). Joint policies are typically cheaper per dollar than two single policies and address the statistical reality that one spouse is much more likely to need care than the other. Available from most carriers; check the shared-care rider.
• What if I'm a non-US person planning LTC for US retirement?+
  If retiring in the US: same coverage options apply as for US citizens — visa-holders can typically purchase LTC if otherwise insurable. If returning to ASEAN/EU for retirement: LTC costs are dramatically lower in most home countries (SG: 1/3 US cost; MY: 1/5; Philippines: 1/10). Some hybrid LTC policies pay benefits internationally; most traditional LTC requires US-licensed providers. If your retirement plan is uncertain, hybrid LTC + life with international-care rider is the most portable option.

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