Insights into the Long-Term Care Market Trends
The long-term care marketplace presents a significant financial challenge for aging Americans, with over half of those turning 65 expected to require some form of long-term care. Despite misconceptions about the collapse of the private long-term care insurance market, millions of Americans are covered by private LTC insurance. There is a growing interest in hybrid LTC options and state/federal initiatives to address long-term care needs. Opportunities exist for enhanced benefit provisions, inflation protection, pricing flexibility, and consumer protections in the long-term care sector.
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Long-Term Care Marketplace Jan M. Graeber Senior Actuary ACLI jangraeber@acli.com July 15, 2021
State of the Long-Term Care Market More than half of Americans turning 65 today will need some type of long-term care (LTC). More than 20% will likely need care for five or more years. 10,000 Americans turning 65 every day Median cost of over $100,000 for a one-year stay in a private nursing home room Boston College Center for Retirement Research Tremendous variation in the duration and intensity of care 2
Private Long-Term Care Market: Misconceptions vs. Reality Misconception that the private long-term care insurance market has collapsed Reality Millions of Americans are covered by private LTC insurance today ACLI members paid out nearly $12 billion in LTC insurance claims in 2019 Consumers find private LTC coverage to be invaluable Growing Hybrid Long-Term Care Market Growing Interest in State and Federal Long-Term Care Initiatives and Programs 3
State and Federal Long-Term Care Initiatives Examples Washington Cares California Study WISH Act Create Opportunities for Public/Private Partnerships 4
Opportunities Nonduplication of Benefit Provisions Inflation Protection Requirements Flexibility in Pricing and Benefit Structure Ability to Provide a Cash Value in Stand-Alone Long-Term Care Opportunities to Age-in-Place Consumer Protections 5
