California Long-Term Care Insurance Cost & Options
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- Long-Term Care Annuities
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Owning LTC coverage in California can play a significant role in your family’s future well-being. By planning ahead you can provide security and peace of mind for years to come by knowing you can:
✔ Secure quality, affordable long-term care.
✔ Safeguard your assets for your spouse and other heirs.
✔ Relieve family members and friends from having to provide extended-care.
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Did You Know?
Almost 70% of people turning age 65 today will need some type of long-term care in the future. The average length of time people need care is 3 years.1
One-third of people may never need long-term care, but 20% will need it for longer than 5 years. On average women need 3.7 years of care while men need 2.2 years.2
In 2024, the average cost for 3 years of long-term care in California is $394,047 ($131,349/year). That cost is projected to be $863,406 ($287,802/year) in 2044.3
Understand Long-Term Care Costs
California Long-Term Care Rates – 2024 (annual) |
|||
| Nursing Home (private room) |
Assisted Living (private room) |
Home Care (44 hours/week) |
|
| State Average | $131,349 | $72,570 | $72,846 |
| Region | Nursing Home Care | Assisted Living Facility | Home Health Care |
| Bakersfield | $114,027 | $48,784 | $59,853 |
| Chico | $130,390 | $59,409 | $68,751 |
| El Centro | $131,349 | $58,545 | $68,694 |
| Fresno | $132,533 | $53,581 | $69,339 |
| Hanford-Corcoran | $138,691 | $57,476 | $72,846 |
| Los Angeles | $117,802 | $76,053 | $66,683 |
| Madera | $112,292 | $50,563 | $70,044 |
| Merced | $123,706 | $59,779 | $75,650 |
| Modesto | $140,611 | $50,907 | $69,346 |
| Napa | $165,669 | $92,658 | $70,025 |
| Oxnard-Thousand Oaks-Ventura | $127,385 | $72,733 | $78,442 |
| Redding | $133,406 | $62,894 | $71,445 |
| Riverside-San Bernardino-Ontario | $119,579 | $55,036 | $69,208 |
| Sacramento-Roseville | $125,380 | $72,404 | $66,419 |
| Salinas | $142,655 | $87,917 | $81,479 |
| San Diego-Carlsbad | $135,241 | $66,530 | $64,620 |
| San Francisco | $140,819 | $86,920 | $79,249 |
| San Jose-Sunnyvale-Santa Clara | $135,713 | $89,618 | $86,334 |
| San Luis Obispo-Paso Robles | $128,620 | $80,177 | $69,860 |
| Santa Cruz-Watsonville | $126,812 | $95,561 | $90,554 |
| Santa Maria-Santa Barbara | $171,030 | $82,231 | $74,318 |
| Santa Rosa-San Rafael | $140,107 | $86,517 | $85,323 |
| Stockton-Lodi | $127,035 | $53,002 | $73,120 |
| Vallejo-Fairfield | $124,590 | $74,298 | $63,419 |
| Visalia-Porterville | $99,764 | $55,928 | $69,771 |
| Yuba City | $123,935 | $55,989 | $80,162 |
Nationwide Financial annual cost of care survey conducted by HVS, site accessed 4/16/2024
Does Medicare Cover Long-Term Care?
Medicare does not pay for long-term care (custodial care). This type of care makes up more than 90% of all long-term care services. Examples of custodial care is when you need help with activities of daily living (walking, bathing, dressing, eating or using the toilet). This is what people need most when they have a physical impairment from a stroke. Or, due to cognitive impairment from dementia or Alzheimer’s disease. Don’t make the mistake of thinking Medicare covers long-term care costs. It doesn’t.
Further, about 80% of care at home is from unpaid caregivers. And more than half of this care includes intensive help with personal care like bathing or dressing.4 And it’s not only seniors that need long-term care. Over 35 percent of people currently receiving care are between the ages of 18 and 64.5
When To Buy Long-Term Care Insurance?
The best age to buy long-term care insurance is when you’re in your fifties or early sixties. Here’s why this makes financial sense:
- The younger you are when you secure a long-term care plan, the lower the annual premiums.
- Even though you pay premiums a longer period of time, you’ll usually pay less than someone buying at an older age.
- By the time you reach your mid sixties, you’re more likely to have a medical condition making you ineligible for a preferred-health discount. Or, making it difficult to get through medical underwriting at all.
- While you’re waiting, you’re uninsured. If an accident or illness happens causing you to need long-term care, you’ll have to pay out of pocket.
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Protect your family and assets by planning ahead.
California LTC Insurance Alternatives
These are the types of long-term care insurance plans available in California.
Traditional LTC Insurance—California Long-Term Care Partnership
- The most comprehensive long-term care benefits for your dollar
- About half of all long-term care plans purchased
- The broadest set of options & LTC benefits
- Recurring premiums
- Learn more about Traditional LTC >
Life Insurance with Long-Term Care Rider
- A permanent life insurance policy with benefits you can use for long-term healthcare
- If care is not needed, your asset passes to your estate as a tax-free death benefit
- May build cash value and have a return of insurance premium option
- Premiums will NOT increase and 1035 exchanges are possible
- You can fund it with qualified dollars (IRA, 401k, etc.)
- Learn more about Hybrid Life with LTC >
Annuity with Long-Term Care Rider
- A deferred annuity contract with long-term care benefits. Includes a fixed interest rate and possible indexing for asset growth
- If not exhausted paying for long-term healthcare, the annuity will transfer to your estate
- Long-term care benefits are usually double or triple the value of the annuity
- Premiums will NOT increase and 1035 exchanges possible
- Learn more about Hybrid Annuities with LTC >
Understand LTC Partnership Plans
California Long-Term Care Partnership
California Partnership for Long-Term Care policies combine private long-term care insurance with Medicaid (Medi-Cal) asset protection. Only Partnership program policies provide this type of Medicaid asset protection from long-term care costs.
The asset protection benefits of the California Partnership for Long-Term Care program apply if your long-term healthcare needs last longer than the insurance benefits of your Partnership policy. For example, for every dollar your California Partnership for LTC policy pays in health care costs, a dollar of assets is exempt from the long-term care Medicaid (Medi-Cal) asset limit. The protected assets are also exempt from Estate Recovery in the same amount as the health care costs paid by your Partnership policy.
California LTC Partnership insurance premiums are like regular policies. We still recommend comparing them with traditional long-term policies. You may find that non-Partnership policies have options that better fit your needs. Including Hybrid Long-Term Care Insurance plans not available under the California Partnership for Long-Term Care. Know that all plans are regulated by the California Department of Insurance.
NOTE: As of the date of this writing, no insurance companies are currently offering LTC Partnership qualified products in California. This means you cannot buy a California Partnership for Long-Term Care policy today. This does not affect current, active insureds who are Partnership qualified.
Traditional and Hybrid Long-Term Care Insurance plans are available.
California Partnership Reciprocity
California does NOT take part in the national reciprocity agreement. The majority of states have Partnership Reciprocity but California is one of the exceptions.
In states with Reciprocity, you can:
- Buy a qualifying Partnership for Long-Term Care policy in one state
- Maintain the special asset protection when you move to another state with reciprocity
- Your new state recognizes accumulated asset protection for Medicaid qualification if you’re already receiving benefits before moving
Who Sells Long-Term Care Insurance in California
Which are the best long-term care insurance companies in California? It depends on your personal situation because it relates to age, health and other factors. Choosing a high ranking company is important, but the plan must have the right set of benefits for your needs.
Our licensed professionals will help you choose the best long-term care insurance company for your situation. Here are the companies we can compare for you:
- Bankers Life & Casualty
- Global Atlantic
- LifeSecure
- Lincoln Financial (MoneyGuard)
- Mutual of Omaha
- National Guardian Life (NGL)
- Nationwide Life Insurance Company
- New York Life
- Northwestern Mutual
- OneAmerica
- Securian Financial
- Thrivent Financial
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Our specialists offer guidance on a wide range of long-term care planning products and strategies. Expect personalized service on topics such as:
✔ Choosing from a variety of long-term care planning products
✔ Suggestions for the insurance company best suited to your situation and goals
✔ Help with medical underwriting (qualifying) for insurance coverage
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About the Author: Craig Matesky
Reviewed by: Mike Berger