Can You Afford Long Term Care Insurance?

Important information to consider before you apply for coverage under the Federal Long Term Care Insurance Program (FLTCIP)

People buy long term care insurance for many reasons. Some buy insurance to make sure they can choose the type of care they receive. Others do not want to use their own assets or have their family pay for long term care. But long term care insurance can be expensive and is not right for everyone.

Please read below for important information and questions that may help you decide if you should apply for this coverage. We recommend that you read the following materials: Book One: Program Details and Rates, which includes the FLTCIP 3.0 Outline of Coverage; Book Two: Additional Information; Premium Rate Increase and Lapse History; and A Shopper's Guide to Long-Term Care Insurance, all of which are found in the application kit. If you have questions about whether long term care insurance is appropriate for you, call us at 1-800-LTC-FEDS (1-800-582-3337) TTY 1-800-843-3557.

1. Can you afford to pay the premiums for the coverage you are considering?
If you plan to pay premiums solely from your own income, a rule of thumb is that you may not be able to afford this coverage if the premium is more than 7% of your income.* Your premium is based on the benefit options you select, your age, and the premium rates in effect at the time we receive your application. If you need help calculating your premium or creating a plan that suits your needs, please use our online premium calculator or call us at 1-800-LTC-FEDS (1-800-582-3337) TTY 1-800-843-3557.

2. Can you afford future changes to your premiums?
Your premiums may increase if:

  • you increase your coverage, either by accepting increases to your benefits under the future purchase option or requesting and being approved for an increase in your benefits
  • you are among a group of enrollees (for example, those with the same plan design or set of benefits) whose premium is determined to be inadequate

Note: Premiums are not guaranteed. While the group policy is in effect, the U.S. Office of Personnel Management (OPM) must approve an increase in premium rates.

3. If you are considering the future purchase option, have you looked at whether you can afford increased premiums for future increases to your benefits?,
If you do not plan to accept future increases, have you considered how you will pay for any long term care that exceeds the amount your insurance will cover?

4. Do you qualify for Medicaid, or are you likely to qualify in the near future?
Medicaid may be available to cover long term care services if you have low income and few assets. If this applies to you now, or you expect it to in the next 10 years, you may want to consider whether long term care insurance is right for you. Eligibility requirements vary by state. To learn more about Medicaid, contact your local or state Medicaid agency.

*National Association of Insurance Commissioners. "A Shopper's Guide to Long-Term Care Insurance," 2019.