Does long-term care insurance cover adult day care?

Are you thinking about buying a long-term care insurance policy? If so, you may be making a wise decision. As you age, you may need help with daily tasks - nearly 70% of Americans do at some point after they turn 65. And, long-term care insurance can help you cover the cost of that help. But, as with any other type of insurance, it's important to consider policy coverages and how the policy's coverage relates to your needs. 

For example, some older adults would prefer to age at home with friends and family. A 2021 AARP survey said 77% of adults older than 50 wanted to remain in their home and a 2022 University of Michigan poll said 88% of adults felt it important to remain in their home for as long as possible. But, even with friends and family members who are willing to help with their care, those who age at home may need adult day care services occasionally. These services can provide care, meals, social activities, recreation and more for those in need. But, according to Genworth, those services will average more than $25,000 annually. So, does long-term care insurance cover adult day care? 

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Does long-term care insurance cover adult day care?

"Long-term care insurance absolutely covers adult daycare services, and most policies have for a very long time," explains Bill Comfort, CLTC, director of training at Certification for Long-Term Care, a training company that provides certifications for long-term care insurance agents. "New policies are 'comprehensive,' meaning they cover the entire care continuum including home care, adult daycare, assisted living and memory care facilities and nursing homes."

But, if you have a policy you purchased in the 1990s, your coverage may be different. "With older policies, particularly those sold in the 1990s, adult daycare was part of the home care or 'home and community care' benefit, which was often sold as a separate rider."

It's also important to read the policy details before you purchase it as some may consider adult day care services as informal care. 

"Adult day care, where long-term care services are being provided, certainly meets the requirement for reimbursement, assuming the policy provides for informal care," explains Larry Nisenson, CGO at Assured Allies, a firm that helps older adults plan for their care. "Most new long-term care policies, including traditional and hybrid policies, certainly cover these types of facilities but it's always prudent to check your policy or call the carrier to confirm coverage details."

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What else does long-term care insurance cover?

So, long-term care insurance covers adult daycare. But, what else does this type of insurance cover? "It can cover home health care aides and nurses," explains Virginia Barausky, national director of sales at The Pinnacle Group, a firm that helps consumers and financial advisors with insurance and long-term care needs planning. "Assisted living facilities are also covered by long-term care policies." And, she explains that even "nursing home care is covered by long-term care policies." Here's what those services offer and how much they cost if you don't have a long-term care insurance policy to pay for them. 

• Nursing homes: Nursing homes are facilities that employ highly skilled nurses to help those who need care on a round-the-clock basis. As such, they are best for those who need a high level of care throughout the day. These are typically the most expensive forms of long-term care with a price tag that averages over $100,000 per year. 
• Assisted living communities: Assisted living communities are an option for those who need help with some tasks, but prefer to live a more active and independent lifestyle. Assisted living communities can also be significantly less expensive than nursing homes. According to Genworth, the average annual cost of an assisted living community is expected to be just over $66,000 through 2024.
• Home health aides: Home health aides offer long-term care services in the comfort of your own home. Depending on the level of care you need, home health aides may provide your care on an hourly basis or be available all day. Of course, the cost of home health aides will vary depending on the level of care you need and other factors. Nonetheless, the average annual cost of a home health aide is expected to be $77,769 through 2024. 

The bottom line

Long-term care insurance typically provides a wide array of coverage, including coverage for adult day care services as well as other forms of long-term care - like nursing homes, assisted living communities and home health aides. Compare your coverage options and purchase a policy today to make sure you have access to the care you may need.