Long-Term Care Planning: What You Need to Know Before It’s Too Late

According to the U.S. Department of Health and Human Services, someone turning 65 today has a 70% chance of needing some form of long-term care (LTC) during their lifetime. On average, women will need about 3.7 years of care, while men will require 2.2 years. Although roughly one-third of today’s 65-year-olds may never need long-term care, 20% of those who do will need it for more than five years.

These statistics make one thing clear: long-term care planning is essential for nearly every older adult. Yet, only about 7.2 million Americans age 65 or older currently have a traditional long-term care insurance policy—a number that hasn’t changed much in years.

Long-term care insurance can be expensive, and choosing the right plan can feel confusing. To make informed decisions, it’s important to understand the facts and dispel some of the most common myths.

7 Common Myths About Long-Term Care

1. “I have to spend down all my assets to qualify for Medicaid.”

This is one of the most common misconceptions. Medicaid is a means-tested program, meaning eligibility is based on financial need. In most states, you can only keep up to $2,000 in countable assets to qualify.

However, several key exemptions apply:

• Your home (if a spouse, minor, or disabled child still lives there)
• One vehicle
• Personal belongings and household items
• Prepaid funeral arrangements and burial plots

In addition, Community Spouse Resource Allowance (CSRA) rules let a non-applicant spouse keep a portion of the couple’s assets to prevent financial hardship.

Before transferring or “spending down” assets, speak with an elder law attorney. Medicaid’s five-year lookback rule can result in penalties if assets are transferred incorrectly.

2. “Medicare will cover my long-term care expenses.”

Unfortunately, this is false. Medicare only covers short-term skilled care under very limited conditions:

• Up to 21 days of skilled in-home care (such as nursing or therapy) if ordered by a doctor.
• The first 20 days in a skilled nursing facility are fully covered, but from days 21–100, you must pay a copay, and coverage ends after that.

Medicare does not pay for custodial or long-term residential care.

3. “I’m too young to worry about long-term care.”

The truth is, anyone can need care unexpectedly. Chronic illnesses such as diabetes, heart disease, or high blood pressure — or even an accident — can lead to the need for long-term support.

According to HHS, about 8% of people aged 40–50 already have a disability that may require LTC services. Planning early gives you more affordable insurance options and more control over your care.

4. “My family will take care of me.”

Relying solely on family members for care can be unrealistic. While many older adults are successfully aging in place thanks to technology, family caregiving often becomes emotionally, physically, and financially draining.

Before assuming family will provide full-time care, have an open conversation. Discuss responsibilities, expectations, and whether they’re truly willing and able to take on that role long term.

5. “My health insurance will cover long-term care.”

Most health insurance plans do not cover long-term care. They may pay for short-term rehabilitation or skilled nursing, but not ongoing custodial care.

Even long-term care insurance policies have limitations — such as elimination periods (similar to deductibles) or benefit caps. Coverage terms vary widely, so read your policy carefully.

6. “I can pay for long-term care out of my retirement savings.”

While this may sound practical, the numbers tell a different story. The national median annual cost for a home health aide is now over $50,000, not including housing, food, or other expenses.

For those requiring assisted living or nursing home care, costs can quickly reach hundreds of thousands of dollars over a few years. Unless you’re independently wealthy, your savings can disappear faster than you think.

Use tools like A Place for Mom’s Long-Term Care Cost Calculator to estimate your personal expenses.

7. “Long-term care insurance is too expensive to be worth it.”

While premiums can be high, the cost of not planning can be much greater. Today’s market also offers more flexible hybrid options that combine life insurance with long-term care benefits — giving you protection and potential cash value.

An experienced elder law attorney can help you compare policy types, assess Medicaid planning strategies, and explore creative financial options for protecting your assets.

 The Bottom Line

Most Americans will need long-term care at some point. Understanding your options now — including insurance, Medicaid planning, and asset protection — can save your family from unnecessary financial and emotional stress later.

We can help you build a personalized long-term care plan that fits your health, financial goals, and family situation.

📞 Call Aging in Maine at (207) 848-5600 to schedule a consultation and start preparing today.

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Read more about long-term care planning:
👉 Creative Financial Approaches to Long-Term Care Services