Overview of Current Long-Term Care Financing Options


The long-term care financing series summarizes current issues in financing long-term care and outlines policy options for increasing affordable access to services.

Date Updated: 03/20/2013

At some point in their lives, most people will need some form of ongoing assistance, often called long term care (LTC) or long-term services and supports (LTSS). This includes assistance with activities of daily living such as bathing or dressing or supervision required by a cognitive condition such as Alzheimer’s disease. LTC is provided to older people and younger adults with disabilities that typically emerge “because of a physical, cognitive, or chronic health condition that is expected to continue for an extended period  of time.”1

Specifically, 70% of those reaching age 65 will need LTC before they die, and they will receive care for an average of 3.5 years.2 Also, LTC is expensive: a year in a nursing home costs over $82,000 on average, and for a private room in an assisted living facility the amount is just under $40,000. Home health care at 20 hours a week costs nearly $22,000 a year.3

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This policy brief provides background on the historical development of benefit eligibility triggers in the private long-term care insurance market. Understanding how these triggers came into being can provide important information to those charged with implementing the CLASS Plan.

This policy brief provides information about how long-term care insurers implement benefit eligibility triggers in the private insurance market. The way in which companies have operationalized benefit eligibility triggers can inform the development of regulations for the CLASS Plan.

This policy brief provides information on the benefit eligibility assessment process in the private long-term care insurance industry. It focuses on how long-term care insurers use the information in the adjudication process, who is involved in the process, and how activities of daily living and cognition are assessed.