Long-Term Care Cost Projection Calculator
Example: Your current age: 55 · Age you expect to need care: 80 · Current daily nursing home cost in your area: 280 $ · LTC cost inflation rate: 3.5 %/yr · Expected duration of care: 3 years · LTC insurance monthly premium (0 if none): 200 $ · LTC policy daily benefit maximum: 150 $
| Projected out-of-pocket cost | $560,321 |
| Projected daily cost at need age | $662 |
| Total care cost (projected) | $724,571 |
| LTC insurance benefit total | $164,250 |
| Monthly savings needed to fund the gap | $805 |
Worked example
A 55-year-old expecting to need care at 80 faces 25 years of LTC cost inflation. Today's $280/day nursing home room grows to $668/day at 3.5% inflation. For 3 years of care, that is $732,060. A policy paying $150/day covers $164,250, leaving $567,810 out of pocket. To fund that gap with monthly savings at 6% over 25 years requires about $760/month.
Frequently asked questions
Does Medicare cover nursing home care?
Medicare covers skilled nursing care only after a qualifying hospital stay of at least 3 days, and only for up to 100 days (with copays after day 20). Medicare does not cover custodial care — help with bathing, dressing, and daily activities — which is the most common form of LTC need.
What does Medicaid cover for long-term care?
Medicaid is the primary payer for nursing home care in the US, but it requires you to spend down most assets first. The spend-down rules vary by state, and the planning around Medicaid eligibility is complex. LTC insurance is one tool for preserving assets before Medicaid kicks in.
When is the best time to buy LTC insurance?
LTC insurance premiums are lowest in your 50s. Waiting until your 60s significantly increases the cost, and health issues can make you uninsurable. The American Association for Long-Term Care Insurance recommends applying between ages 52 and 64.
Are there alternatives to traditional LTC insurance?
Yes: hybrid life insurance/LTC policies let you access the death benefit for care if needed. Asset-based LTC policies funded by a lump sum are another option. A fee-only financial planner can model all three approaches for your situation.