Types of long-term care plans

Private insurance options

Individual (traditional) long-term care insurance

A standalone policy dedicated to long-term care. It offers the most flexible design — you choose the daily or monthly benefit, how long benefits last, the waiting period, and inflation protection — and pays for care at home, in assisted living, or in a nursing home. It typically delivers the most care benefit per premium dollar, but there's no payout if you never need care.

Hybrid (linked-benefit) policies

Hybrid policies combine long-term care with another product, so your money isn't "used up" if you stay healthy:

• Life insurance + long-term care. You fund a life insurance policy with a long-term care rider. If you need care, it pays for care; if you don't, your family receives the death benefit. Many are funded with a single premium or a few years of payments.
• Annuity + long-term care. An annuity that grows over time and pays an enhanced amount for qualified long-term care. Useful for repositioning savings you might otherwise earmark to self-insure.

Hybrids usually cost more up front than traditional coverage, but the "use-it-or-lose-it" concern goes away. See our dedicated guide to asset-based & hybrid coverage for how the structures compare and who they fit.

Employer / group plans

Some employers offer long-term care insurance as a voluntary benefit, sometimes with simplified underwriting — a real advantage if a health condition might keep you from qualifying for an individual policy on your own. Group coverage can also come with a modest premium discount versus buying individually.

The tradeoff: employer plans are often more restrictive than what you could design yourself — fewer choices on benefit period, inflation protection, and daily benefit amount, and the policy may not be portable (or may cost more) if you leave the job. Healthy applicants can often find more flexible designs or better long-term pricing on the individual market, so it's worth comparing both before you decide.

Asset protection: state partnership programs

A Partnership policy is a traditional long-term care policy that meets state standards — it is not insurance run by the state. Its advantage: for every dollar the policy pays in benefits, you can protect a dollar of your assets if you later apply for Medicaid. It's a way to combine private insurance with a Medicaid backstop.

Public programs (what they do and don't cover)

• Medicare pays only for limited, short-term skilled care after a qualifying hospital stay — not ongoing custodial long-term care.
• Medicaid does cover long-term care, but only after you've spent down most of your assets to qualify. It's the largest payer of long-term care in the U.S., and often the fallback when savings run out.
• VA benefits. The Department of Veterans Affairs offers some long-term care and income-based benefits (such as Aid & Attendance) to qualifying veterans and spouses.
• New state public programs. An earlier federal program (the CLASS Act) was repealed in 2013, but states are now stepping in — Washington's WA Cares Fund launched public long-term care benefits in 2026, and other states are studying similar programs. Benefits are modest and limited to that state's residents.