The price of long-term care coverage has been on a steady march upward, and a new round of rate increases is landing in mailboxes across the country.
For anyone who bought a policy years ago expecting a fixed bill, the letter can come as a genuine shock.
Insurers are asking regulators for permission to raise premiums on existing policies, not just new ones.
A private room in a nursing home now runs well past $100,000 a year in many states, and in-home care isn't cheap either.
A home health aide can cost $30 an hour or more depending on where you live.
That's the expense this insurance is meant to offset, and it's why the coverage matters to a lot of families.
For a healthy 60-year-old couple, a policy with meaningful benefits can easily run $3,000 to $5,000 a year combined, and that's before any future increases.
Buy at 70 instead of 60, and the same coverage might cost two or three times as much.
Age is the single biggest lever on price.
Insurers badly misjudged two things decades ago: how long people would live and how many would actually file claims.
Low interest rates also hurt, because insurers count on investment returns to fund future payouts.
When those returns shrink, premiums have to make up the difference.
A few practical moves: - Shop the same benefit package at three or four carriers.
Quotes for identical coverage can vary by thousands per year. - Look at a shorter benefit period, like three years instead of five.
Most claims don't run that long, and the savings are real. - Compare against a hybrid policy, which combines life insurance with a long-term care benefit.
You may pay more upfront, but the premium typically can't be raised on you. - Ask your state insurance department whether you qualify for a rate-increase exemption or a reduced benefit option instead of a higher bill.
One more thing worth knowing: many states now run Partnership programs that let you keep more of your assets if you buy a qualifying policy.
It's a quiet perk that doesn't get much attention, and it can change the math for middle-income households.
If a rate increase letter shows up, don't just pay it or cancel in frustration.
You usually have options, including trimming inflation protection or lowering the daily benefit.
Call the insurer and ask what choices they're offering, then run the numbers before you decide.
The bottom line is that long-term care insurance is still worth considering if you have assets to protect and can afford the premiums without straining your budget.
But treat it like a mortgage, not a magazine subscription.
Get quotes from several companies, read the fine print on rate increases, and revisit the decision every few years as your health and savings change.
Final Thoughts
Doing nothing is also a choice, and it's often the most expensive one.