Long-term care insurance is one of the most effective tools for protecting assets from nursing home costs — but only if you understand what your policy actually covers and when benefits begin.
What Long-Term Care Insurance Covers
Most long-term care (LTC) insurance policies cover care in:
- Nursing homes (skilled nursing facilities)
- Assisted living facilities
- Memory care units
- Adult day care centers
- Home health care
Coverage is typically triggered when the insured cannot perform at least 2 of 6 activities of daily living (ADLs) — bathing, dressing, eating, toileting, transferring, and continence — or has a severe cognitive impairment like Alzheimer’s.
How Benefits Work
- Daily/monthly benefit: The maximum amount the policy pays per day or month (typically $150–$300/day for nursing home care)
- Benefit period: How long benefits last — typically 2, 3, 5 years, or lifetime
- Elimination period: The waiting period before benefits begin (usually 30–90 days — similar to a deductible). You pay out of pocket during this time.
- Inflation protection: A rider that increases benefits annually — essential given rising care costs
How to File a Claim
- Contact your insurer as soon as a care need is anticipated — the claims process can take 30–60 days
- A physician must certify the need for care and complete the insurer’s medical forms
- The insurer may conduct their own assessment
- Keep all care receipts and invoices for reimbursement claims
What to Do If You Don’t Have LTC Insurance
If your loved one does not have LTC insurance, review other payment options: Medicare (for short-term skilled care), Medicaid (for long-term care after asset spend-down), VA benefits (for eligible veterans), and private pay from savings or retirement accounts. See all payment options →
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