Might Long-Term Care Benefits Resonate With Your Workers?

Americans are very underprepared when it comes to understanding and preparing for their own long-term care (LTC) needs as they grow older, according to new industry research by LIMRA, the Life Insurance Marketing and Research Association.

The research showed while a 65-year-old American has a 70% chance of needing LTC during their remaining lifetime, only 3% have affiliated insurance to cover the costs.

LTC benefits for workers are typically offered through employers as voluntary insurance, providing financial protection for help with daily activities (e.g., bathing, dressing) not covered by health insurance, with benefits for home care, assisted living or nursing homes. Plans generally feature easier underwriting and group discounts, allowing employees to secure coverage for themselves and families, often portably, and helping them plan for future care needs.

LTC costs can be substantial and vary by location and care type. According to data from the U.S. government’s Federal Long Term Care Insurance Program, 2024 national LTC median costs were approximately:

• $9,300 to $10,600 per month for nursing homes (semi-private/private);
• $5,900 per month for assisted living; and,
• $214 per day for home health aides.

However, these figures are projected to rise significantly with inflation.

Access a bonus Workspan Daily Plus+ article on this subject:

• Comparing Long-Term Care Insurance Options: Traditional Versus Hybrid

‘The Need for Coverage Is Growing’

LIMRA’s research also found that while 65% of consumers worry about becoming physically dependent on others, only 44% have discussed LTC planning with their financial professional. More than one-third also reported being worried about paying for LTC services should they become unable to care for themselves.

An increasing number of employers are starting to offer LTC insurance to address aging concerns among workers of all demographics. Organizations can sponsor these group plans, making it more accessible and affordable than individual policies.

“The need for coverage is growing,” said Ron Neyer, LIMRA’s associate research director, adding that it’s not just among Baby Boomers and Generation X workers showing interest.

“Millennials now comprise the largest share of the workforce, and many of them have experienced caregiving stress first-hand,” he said, “so they are more open to and aware of such coverage.”

Given all that, now may be the right time to consider or review LTC benefits as part of your total rewards (TR) offering.

An ‘Unmet’ Need

As approximately 11,000 Americans each day turn age 65, the LIMRA research puts the LTC coverage gap into sharper perspective for employers and workers, Neyer said.

To wit: 40% of surveyed employees consider LTC solutions to be very important, but 20% also consider it an “unmet” employee benefit.

“There’s a big need that’s unfilled to this point,” Neyer said, adding that hybrid policies are beginning to gain market traction.

He noted, “Younger consumers like that it can be packaged as enhanced life insurance coverage that pays a death benefit if you die, but it can also be a tool to pay for LTC services, if needed.”

He also pointed to LIMRA’s Individual Retail Life Insurance Sales Survey, which found such hybrid products generated $4.2 billion in new premiums and 450,000 new policies in 2024.

Industry research also points to a growing market, with 11 of the 40 largest insurance carriers providing both LTC and chronic-illness solutions and four others set to enter the market soon.

“If you looked a few years ago, those numbers would have been a lot lower,” Neyer said.

LTC and Financial Wellness

Despite the recent market growth, both employee knowledge and access to LTC coverage remains limited, according to research from the Employee Benefits Research Institute (EBRI).

A significant proportion of future caregivers had not estimated LTC costs, according to EBRI’s 2024 Long-Term Care Survey. And among those who had estimated the cost of care for a specific individual, many underestimated the cost of LTC, with most expecting annual expenses to remain under $50,000.

Meanwhile, employee access to traditional LTC coverage ranges between 15% and 30%, depending on employer size and structure, said Bridget Bearden, a research and development strategist at EBRI.

But EBRI research showed, in a possible sign of things to come, that two out of three employers that currently do not offer LTC coverage are in the process of adding or evaluating the benefit in the future.

“It’s definitely something that’s top of mind for a lot of employers that currently don’t offer it,” Bearden said.

Given the skyrocketing trajectory of costs associated with healthcare, EBRI research also positioned LTC coverage as a financial wellness tool for employees — and many organizations are doing so.

According to the institute’s 2025 Financial Wellbeing Survey, 1 in 4 financial wellness-interested employers with 500 or more employees currently offer LTC coverage, and nearly 60% of employers view such coverage as a “financial wellness” benefit.

Resources for HR and TR Pros

According to Bearden, before an organization decides to move forward with providing voluntary LTC insurance to workers, it may make sense to seek out a specialist broker to determine the appropriate path forward.

“Some organizations, for example, are first and only rolling LTC coverage out as an executive benefit,” she said. “So, it’s very important to get the sizing correct.”

Steve Cain, the director of LTCI Partners, a brokerage firm specializing in LTC solutions, agreed: “This product is not suitable for everybody. It’s not [necessarily a target] for twentysomethings.”

He recommended that organizations work with a benefits broker to survey their workforce’s needs, adding that the ideal candidates for this type of coverage typically are workers between the ages of 45 and 65 with a total household income of $100,000 or more.

Cain said, though, that identifying the target audience is only one piece of the process.

“In my opinion, it’s not enough to just throw it against the wall and offer it,” he said. “As a benefits professional, you’ve got to stay engaged to ensure people understand the offering, because this is relatively new. It’s a different conversation, and that takes more [dialogue].”

Editor’s Note: Additional Content

For more information and resources related to this article, see the pages below, which offer quick access to all WorldatWork content on these topics:

• Employee Benefits
• Well-Being