Long-Term Care Insurance Is Getting Harder To Buy. Here’s Why You Might Not Need It Anyway

Long-term care insurance has a math problem. The people who need it most are often the same people who can’t qualify for it or can’t afford it.

Underwriting has tightened as insurers have fled the business. Premiums have climbed for years, sometimes doubling for existing policyholders who have already paid in for a decade or more. What used to be a straightforward decision in your 50s or 60s now comes with real friction at every step.

What Clark Howard Says Right Now

Money expert Clark Howard still tells people to think seriously about long-term care coverage, but his framework has narrowed to three groups.

• If you’d qualify for Medicaid based on low income, you don’t need to buy insurance against this risk.
• If your net worth is $3 million or more excluding your home, Clark generally doesn’t recommend it either.
• Everyone in between is the group he says should consider a policy.

“Getting old is part of life,” Clark says. “At some point, most of us are going to need care. Maybe in a nursing home. Assisted living. Or skilled care in our homes. Are you prepared?”

His timing advice hasn’t changed much: Buy in your late 50s or early 60s, when you’re more likely to pass underwriting and before premiums have had decades to compound. He’s blunt about the alternative. “It’s your choice,” he says. “Take your chances that you’ll be in the small group of people that will never need help in old age or buy insurance to cover yourself.”

But buying insurance isn’t the only way to prepare for that risk. As Wes Moss argues later in this article, some retirees may be better served by building potential long-term care costs into their overall financial plan and preparing to self-fund if necessary.

Clark has also been candid about how badly the traditional LTC market has performed. “There were over 1,000 companies at one time that issued long-term care policies and now there might be 10,” he says. “It’s totally a business that the insurance industry was like, ‘Wow, we screwed that up.’ And they headed for the exits.”

That collapse is why hybrid policies, whole life insurance with a long-term care rider, have become the fallback for people who want price certainty. Clark points out the tradeoff plainly: Hybrids can cost 200% to 300% more than traditional LTC coverage, but the premium never escalates, and your heirs get value back if you never use the benefit.

Why You May Not Need To Buy It At All

Wes Moss, a fiduciary financial advisor and host of Ask an Advisor on the Clark Howard Podcast, takes a different angle on the same problem. His view is that long-term care insurance is often too expensive for the very people who would need it, and premiums have risen for years to the point where policies can become impractical to keep paying for.

Rather than pre-funding the risk with a policy, Wes suggests building the potential cost of care into your overall financial plan instead.

His reasoning centers on something most LTC conversations leave out: Retirement spending doesn’t stay flat once care becomes necessary. Travel stops. Dining out drops. Discretionary spending across the board slows down at exactly the point when care costs start showing up.

If you’re spending $10,000 a month in retirement and $3,000 of that goes toward travel, restaurants, entertainment and other discretionary expenses, intensive care may eliminate much of that spending. In other words, a $5,000 long-term care bill doesn’t necessarily mean you suddenly need $5,000 more in monthly income.

That freed-up cash flow can go toward paying for care, reducing the amount you need to pull from your portfolio or other sources.

Two Ways to Think About the Same Risk

Clark’s framework and Wes’s framework aren’t in conflict. Clark is describing who can still get coverage and what to look for if you decide to buy it. Wes is questioning whether a policy is the right tool at all for the large group of people stuck between “qualifies for Medicaid” and “has $3 million to self-insure.”

If you’re in your 50s, healthy, and the premiums fit comfortably into your budget without crowding out saving elsewhere, Clark’s approach still holds up. If the quotes coming back are already straining your plan, or you’ve watched a policy’s premium climb past what you budgeted for, Wes’s approach gives you a way to plan for the risk without betting on an insurance market that has spent the last two decades shrinking.

Final Thoughts

Long-term care is a risk you need to plan for, but that doesn’t necessarily mean you need long-term care insurance.

For some people, a policy can provide valuable protection and peace of mind. For others, the premiums may be too expensive, or the coverage may no longer make sense given how much the insurance market has changed. And if you’re able to build enough flexibility into your retirement plan, you may be better off preparing to pay for care yourself.

The important question isn’t simply, “Should I buy long-term care insurance?” It’s “What happens to my finances if I need long-term care?” Think through what your monthly spending would look like, which expenses would likely shrink or disappear, and how much you could realistically redirect toward care.

Whether you choose long-term care insurance or to self-insure, having a plan before you need care can help you protect both your retirement security and the people you love.