In the United States, the aging population is redefining the landscape of long-term care. With millions of Americans approaching the age of 80 — the age at which the need for daily assistance becomes more common — understanding, planning, and preparing for the costs and demands of such care is more urgent than ever.
According to the U.S. Census Bureau, the number of Americans aged 85 and older is expected to double by 2035 (to 11.8 million) and nearly triple by 2060 (to 19 million). This demographic shift not only places significant economic pressure on families and healthcare systems but also raises an essential question: who will take care of all of us?
The Perfect Storm: More Demand, Fewer Professionals
While the demand for caregivers is growing exponentially, the supply of workers in the sector is shrinking. CareScout, a company that monitors care costs in the U.S., points out that the long-term care workforce is in crisis. With average wages of just $16.72 per hour in 2023, many professionals are leaving the field in search of better working conditions.
Even more concerning: about 28% are immigrants. With immigration policies becoming more restrictive, especially during administrations like President Trump’s, the shortage is likely to worsen — directly impacting the quality of care.
The Cost of Aging in the United States
The numbers don’t lie. According to CareScout’s 2024 survey, the average monthly costs for different types of care are:
- Assisted living: $5,900/month
- In-home care with a homemaker: $6,292/month
- Private room in a nursing home: $10,646/month
These costs have risen by about 10% in one year — far above the average inflation rate of 2.9%. And projections indicate that these increases will continue in the coming years.
Still, many Americans continue to believe that Medicare covers these services comprehensively — which is not true.
Medicare, Medicaid, and Misunderstandings
Most retirees rely on Medicare as their primary source of healthcare coverage. But there’s an important detail: Medicare covers, at most, 100 days of care in a skilled nursing facility following a hospitalization. After that, the costs are your responsibility.
Medicaid does offer long-term care coverage, but it requires beneficiaries to have very limited income and assets. In other words, to qualify, individuals often have to “spend down” nearly all of their personal wealth — which can compromise the financial well-being of a surviving spouse or heirs.
| Category | Medicare | Medicaid |
| Program Type | Federal public health insurance | Joint federal and state assistance program |
| Who Qualifies | People aged 65+ or under 65 with certain disabilities | Low-income individuals, regardless of age |
| Main Eligibility Criteria | Age or disability | Income and asset limits |
| Administration | Federally administered (same rules nationwide) | State-administered with federal guidelines (rules vary by state) |
| Cost to Beneficiaries | Monthly premiums, copays, and deductibles | Usually free or low cost depending on income |
| Prescription Coverage | Part D (or included in Advantage plans) | Included, but varies by state |
| Long-Term Care Coverage | Limited to short-term rehab after hospital stays | Covers long-term care (nursing homes, in-home assistance) |
| Eligibility for Long-Term Care | Restricted, only with qualifying medical needs | Available for those with low income and functional need |
| Enrollment Process | Automatic at age 65 or through SSA application | Apply through your state’s Medicaid office |
Long-Term Care Insurance: A Dying Option?
In the 1980s and 1990s, private long-term care insurance gained traction. But high costs, complex policies, and unexpected premium increases eventually undermined the popularity of these products. Today, fewer than a dozen insurers still offer such policies.
An alternative is hybrid insurance, which combines life insurance policies with long-term care coverage. If the benefit is not used during your lifetime, it converts into an inheritance. It’s a way to ensure that the investment isn’t “lost” if care isn’t needed.
Self-Funding: Is It Possible?
For many Americans, the alternative will be using their own savings. But this requires rigorous planning. Experts like Carolyn McClanahan, a physician and financial planner in Florida, suggest setting aside two to five years’ worth of long-term care expenses — equivalent to hundreds of thousands of dollars.
She also recommends keeping at least five years of expenses in highly liquid assets, such as cash or short-term bonds. And she emphasizes: “Families should make sure that, in financing one spouse’s care, they are not leaving the other financially vulnerable.”
Informal Care and the Impact on Families
According to the CRR, over 64% of care hours in the U.S. are provided by family members, children, spouses, and close friends. This care, however, comes at a cost: nearly 60% of caregivers report cutting back on basic expenses such as food or clothing. One-third say they have fallen behind on rent or bills. Long-term impacts include reduced savings, lower Social Security benefits accumulation, and professional stagnation.
The Time to Act Is Now
Planning for long-term care isn’t easy. But being unprepared can cost far more — emotionally and financially. Start with a conversation with your loved ones. Understand your options. Seek a financial planner. Explore your eligibility for hybrid policies or other financing methods.
Aging is inevitable. Helplessness is not.
