Health
Survey highlights widespread misconception among middle-class Americans regarding Medicare long-term care coverage
Nearly 40% of middle-class households wrongly expect Medicare to cover extended care, leaving many financially vulnerable amid rising industry costs.
The short version
- A survey by the American Council of Life Insurers found that 39% of middle-class households expect Medicare to cover their long-term care expenses, despite the program generally not covering custodial nursing care.
- Individuals approaching retirement face substantial costs, with the national median price for a semi-private nursing home room reaching $114,975 per year.
- Financial experts emphasize that long-term care relies primarily on private insurance, out-of-pocket self-funding, or Medicaid, which requires meeting strict state-level income and asset limits.
- Retirement advisers recommend that individuals begin planning for long-term care in their 50s or 60s to manage premium expenses and explore policy options before reaching crisis points.
Key facts
- An August survey by the American Council of Life Insurers found that 39% of middle-class households earning between $50,000 and $150,000 expect Medicare to fund long-term care.[CNBC]
- According to KFF, Medicare does not cover ongoing custodial or long-term nursing facility care, limiting skilled nursing facility coverage to up to 100 days following a qualifying hospital stay of at least three consecutive days.[CNBC]
- Medicaid serves as the primary payer for nursing facility care for low-income individuals, but eligibility requires exhausting personal assets and complying with state-specific income restrictions.[CNBC]
- Department of Health and Human Services data from 2020 indicates that individuals reaching age 65 have an estimated 70% probability of requiring long-term care services.[CNBC]
- The national median annual cost of a semi-private room in a nursing facility reached $114,975, according to a 2025 survey by CareScout.[CNBC]
- A March report from the AARP Public Policy Institute found that home care costs rose 39% since 2021, outpacing broader inflation rates.[CNBC]
What remains uncertain
- The proportion of middle-income households that will successfully self-fund long-term care costs remains uncertain given escalating care prices and varying state Medicaid eligibility criteria.[CNBC]