Is Private Long-Term Care Insurance the Answer?

Introduction

As the population ages, more Americans than ever before will need long-term care. The cost of providing services is already straining government and family budgets, and costs are expected to soar in a few decades when the Baby Boomers begin to reach their 80s. One option often touted as a possible solution to the looming crisis is to promote private insurance coverage of long-term care needs. This brief describes private long-term care insurance and some of the advantages and limitations of coverage. Despite ongoing efforts to promote private long-term care insurance, widespread coverage faces a number of important hurdles, including affordability, uncertainty about future premium increases, and the disincentives created by the Medicaid safety net…