Long-Term Care: How Big a Risk?

The brief’s key findings are:

• Long-term care is expensive, but only 13 percent of single individuals over 65 have long-term care insurance.

• Previous models of care usage appear to understate the risk of going into care and overstate the duration of care for those who require it.

• If long-term care is a more likely, but less expensive, event, fewer people may benefit from insurance than previously estimated.

• Our analysis shows that it is optimal for only about 20-30 percent of single individuals to buy insurance.

• This result strengthens the finding of previous research that Medicaid crowd-out can explain why most households do not buy insurance.