The Misconception About Medicare and Long-Term Care
A new survey from the 2025 Nationwide Retirement Institute has revealed that nearly six in 10 Americans mistakenly believe that Medicare covers long-term care (LTC), putting millions at risk of financial hardship. The poll, conducted among US adults aged 29 and older with household incomes of $75,000 or more, found that 58% expect Medicare to pay for extended care. However, Medicare only provides limited, short-term coverage and does not fund the long-term daily assistance that many older adults eventually require.
As life expectancy continues to rise, with the US Census Bureau projecting the number of centenarians to quadruple by 2054, the likelihood of needing LTC is also increasing. Despite this, 41% of survey respondents said they do not expect to live long enough to need LTC insurance, even though nearly 70% of people turning 65 today are projected to require some form of long-term care.
The cost of LTC is a growing concern. More than half of respondents (58%) expressed uncertainty about their ability to pay for their own or a partner’s care. A similar share (59%) said they plan to rely on Medicaid to cover expenses, indicating that many anticipate reducing their assets to meet eligibility requirements. Medicaid is currently the largest source of funding for LTC in the US, but it is also subject to potential budget cuts.
Preferences vs. Reality in Long-Term Care
Preferences for aging in place appear to conflict with financial and logistical realities. While 77% of Americans said they would prefer to receive care at home, 41% reported that their current residence may not be safe or accessible for aging. Nearly half (47%) said they expect home modifications to be unaffordable. Additionally, 54% said the real estate market makes relocating difficult, and 42% of adults aged 61 and older said they plan to stay in their current homes without renovations.
Long-term care expenses are also affecting family finances. Half of respondents said these costs will likely reduce the inheritance left for their children, and 42% of current caregivers believe their caregiving expenses could limit what they leave behind for their own heirs. Caregivers reported spending an average of $372 per month on out-of-pocket expenses such as prescriptions, transportation, and household needs.
The Underutilization of Long-Term Care Insurance
Long-term care insurance (LTCI) remains underutilized despite being seen by some as a useful tool. While 32% said LTCI would help with planning for extended longevity, only 10% said they currently own a policy. Interest in buying LTCI appears to be declining, with 40% saying they do not plan to purchase coverage, an increase from 32% in 2024. Cost is a common concern, with 38% citing price as a barrier. However, 64% overestimated the actual cost of LTCI, and 47% said they would reconsider purchasing it after learning the accurate pricing.
The survey also found gaps in planning. Among those who work with financial advisors but haven’t discussed LTC planning, the most common reason was that their advisor had not raised the topic. Two-thirds said they trust their advisor to guide them on the timing of a purchase.
The survey was conducted online by The Harris Poll between March 17 and April 7, 2025, among 1,324 respondents. Data were weighted for demographic accuracy.
