The Odds Are Higher Than You Think
Most people assume long-term care is something that happens to other families. The numbers say otherwise.
What long-term care means
Long-term care is help with everyday activities, such as bathing, dressing, eating, moving around or managing memory loss, when you can no longer do them on your own. It is usually not medical treatment, and it is not just nursing homes. Most care actually happens at home, with the rest in assisted living or nursing facilities.
Women face the biggest risk
On average, women who need care need it for 3.7 years, compared with 2.2 years for men. Women also more often outlive the spouse who might have cared for them.
How to Stay Out of the Nursing Home
Ask almost anyone where they'd want to receive care, and the answer is "at home." Most care does happen at home, but staying there takes planning, and the time to plan is before you or a family member needs care.
Know what Medicare will and won't do
Medicare can pay for short-term skilled care at home, such as nursing or therapy after a hospital stay. It generally does not pay for ongoing help with bathing, dressing, meals or supervision, which is most of what people need to stay at home.
Plan how home care would be paid for
A home care aide in California now costs about $7,627 a month for 44 hours a week. Without a plan, that bill falls on your savings or on your family. Some coverage pays for care at home and in assisted living, not just in a nursing home, so check what any plan you own, or are considering, actually covers.
Get your home and family ready
- Make the home safer: grab bars, better lighting, a first-floor bedroom and bathroom, and no-step entries can delay or prevent a move.
- Talk with your family now: who would help, how often, and what would happen if they couldn't. Family caregivers often give up work and income to help.
- Know the middle steps: adult day programs and assisted living can bridge the gap between living at home and a nursing home.
- Put your paperwork in place: a durable power of attorney and a health care directive let someone you trust act for you if you can't.
Sources: Medicare.gov, home health services; CareScout, Cost of Care Survey, California 2025 data.
What Care Costs in California
California is one of the most expensive states for long-term care, and costs keep rising, with nursing home rooms up 4% and home care up 5% in a single year.
| Type of care (California median, 2025) | Per month | Per year |
|---|---|---|
| Nursing home, private room | $15,178 | $182,135 |
| Nursing home, semi-private room | $12,167 | $146,000 |
| Home care aide (44 hours a week) | $7,627 | $91,520 |
| Assisted living | $6,900 | $82,800 |
Who pays? Probably not who you think
- Medicare generally does not pay for long-term custodial care. It covers only limited skilled nursing after a hospital stay, for up to 100 days, with conditions.
- Medi-Cal pays for nursing home care only after most of your savings are gone. As of January 1, 2026, California again limits countable assets to $130,000 for an individual, plus $65,000 for each additional household member, and can look back 30 months at transfers.
- Your family often fills the gap with unpaid care, lost work time and their own savings.
- Your savings pay for everything else. Three years in a private nursing home room could cost more than $540,000.
What Care Could Cost in the Future
If you're planning for care you may need 10, 20 or 30 years from now, today's prices are only the starting point. Here's what California nursing home costs could look like if they keep rising at 4% a year, the same increase semi-private rooms saw last year.
| Annual cost | Today (2025) | In 10 years | In 20 years | In 30 years |
|---|---|---|---|---|
| Semi-private room | $146,000 | $216,100 | $319,900 | $473,500 |
| Private room | $182,135 | $269,600 | $399,100 | $590,700 |
Monthly, a private room would run about $22,470 in 10 years, $33,260 in 20 years and $49,230 in 30 years.
Small differences add up
| Private room, per year | In 10 years | In 20 years | In 30 years |
|---|---|---|---|
| At 3% a year | $244,800 | $329,000 | $442,100 |
| At 4% a year | $269,600 | $399,100 | $590,700 |
| At 5% a year | $296,700 | $483,300 | $787,200 |
What this could mean for you
A 60-year-old today who needs care in 20 years could face about $1.2 million for a three-year stay in a private room, at 4% a year, before any further increases during the stay. A benefit that sounds generous today, such as $165,000, would cover only about five months of that care.
Projections start from CareScout's 2025 California median costs and assume the growth rates shown. They are hypothetical illustrations, not predictions; actual costs vary by location, facility and future inflation.
How Traditional LTC Insurance Works
It works like car or health insurance: use it or lose it
You pay premiums every year, and if you need care, the policy pays benefits up to its limits. If you never need care, or you stop paying, most traditional policies have no cash value to return. The premiums you paid are simply gone, just like car insurance premiums in a year with no accident.
The longer you wait, the more it costs
Premiums are based on your age and health when you apply. Waiting ten years can nearly double the price, if you can still qualify.
| Age when you buy | Single man | Single woman | Couple (combined) |
|---|---|---|---|
| 55 | $950 a year | $1,500 a year | $2,080 a year |
| 60 | $1,200 a year | $1,900 a year | $2,600 a year |
| 65 | $1,750 a year | $2,700 a year | $3,750 a year |
Average 2025 premiums for a $165,000 initial benefit with no inflation protection, as published by the American Association for Long-Term Care Insurance. Rates vary by state, insurer and health.
Your premium isn't locked in
With most traditional policies, the insurance company can ask state regulators to raise premiums on existing policyholders, and many have, sometimes repeatedly. Some requested increases have ranged from 50% to 150%. When that happens, policyholders usually face three choices: pay more, cut their benefits, or drop the coverage and lose what they've paid in. These increases often arrive in your 70s or 80s, when you're living on a fixed income.
The Downsides to Weigh
You may never get back what you put in
A couple who buys at 65 and pays $3,750 a year until 85 would pay about $75,000, before any rate increases. If neither ever needs care, that money is gone. This is the single biggest reason people hesitate to buy traditional coverage.
Premiums can rise when you can least afford it
Rate increases on existing policies can force a hard choice late in life: pay more than you planned, accept less coverage, or walk away from years of premiums.
You have to qualify medically
Health conditions can raise your price or make you ineligible. The longer you wait, the more likely a health change takes options off the table.
Benefits may not keep up with costs
California care costs rose 4% to 5% in a single year. Without an inflation rider, which adds substantially to the premium, a benefit that looks generous today may cover far less when you need it.
There are newer ways to plan
Today, there are modern approaches to long-term care planning designed to remove the "use it or lose it" risk. Some can provide guaranteed premiums that can never increase, and make sure your money still benefits your family whether or not you ever need care. They aren't right for everyone and they still require qualifying, but they're well worth comparing before you buy, or keep paying for, a traditional policy.
Your Long-Term Care Plan Check
A few minutes with these questions will show whether you have a plan, or a gap. Blanks are fine; they're what we'll work on together.
A. If you needed care for three years
B. How would you pay for it today?
C. Already have a long-term care policy?
Your next step: a free long-term care review
In a no-obligation review, we'll go over your plan check, estimate what care could cost you, talk through how you could receive care at home, and compare traditional long-term care insurance with the newer alternatives, including what each costs, what it covers and what happens if you never need care.
What to have available for our meeting (whatever you have is fine):
- Your completed plan check
- Any long-term care policy you own, plus any rate increase letters
- Recent statements for savings, IRAs and annuities
- A list of current medications and health conditions (helps us see which options you may qualify for)
Email: rick@rickliuagagency.com
Important disclosures
This material is for educational purposes only and is not an offer of insurance or a recommendation to buy, keep or cancel any policy. Do not cancel an existing policy before reviewing your options and confirming new coverage is in force. Premiums, benefits and availability vary by insurer, state, age and health, and all coverage is subject to underwriting. Statistics are from the sources below and are national unless stated otherwise. Medicare and Medi-Cal rules are summarized and subject to change; consult the program or an elder law attorney for your situation. Rick Liuag Insurance and Financial Services does not provide tax or legal advice. Insurance products offered through Rick Liuag Insurance and Financial Services, CA License #0E72518.
Sources: U.S. Administration for Community Living, LongTermCare.gov, "How Much Care Will You Need?"; Milliman, "The long-term care insurance industry through 2024" (covered lives as a share of U.S. population 60+); CareScout, Cost of Care Survey, California 2025 data (released March 2026); American Association for Long-Term Care Insurance, 2025 Price Index; Oregon Division of Financial Regulation, long-term care rate increases; Justice in Aging, Medi-Cal asset limit reinstatement (2026).
About Rick Liuag
For 37 years, Rick Liuag has helped people protect two things that matter most: the income they'll live on and the savings they've worked hard to build.
Rick works primarily with pre-retirees, retirees and small business owners, people who have spent decades building something and want to make sure it lasts. His clients often come to him with the same questions: Will my savings last as long as I do? What happens if the market drops right before I retire? How do I protect my family from a big, unexpected expense?
He writes his guides in plain language, explains the trade-offs along with the benefits, and never recommends something that doesn't fit. His clients always know how a plan works, what it costs and how he's paid before they decide anything.
Rick Liuag, Certified Pension/Retirement Advisor
Rick Liuag Insurance and Financial Services · Corona, CA
CA License #0E72518 · Also licensed in TX, NV, SC, GA and FL
951-515-0292 · rick@rickliuagagency.com
Want a printable copy?
Download the PDF version of this guide to print or keep.