What AARP Long-Term Care Insurance Covers: The Basics
AARP long-term care insurance is a policy designed to help pay for care services that people may need as they age. Unlike regular health insurance, which covers doctors, hospitals, and acute medical conditions, long-term care insurance focuses on help with daily activities and ongoing support. This guide explains what this type of insurance typically covers so you can understand the kinds of services and settings that may be included.
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Long-term care needs often arise when someone can no longer handle everyday tasks independently. According to the U.S. Department of Health and Human Services, about 70% of people over age 65 will need some form of long-term care services during their lifetime. AARP offers long-term care insurance through partner insurance companies, and these policies outline specific services and settings that are covered.
The coverage generally falls into several categories: nursing home care, assisted living facilities, adult day care, home care services, and hospice care. Each category has different purposes and different levels of support. For example, nursing home care provides 24-hour medical supervision and assistance, while home care might include a few hours per week of help with household tasks and personal care.
Understanding what a policy covers means looking at the actual policy document, which lists covered services, daily or monthly benefit amounts, and how long benefits will be paid. Some policies cover certain types of care only if a doctor says they are medically necessary. Others have fewer restrictions. The specifics vary by policy, so comparing details matters if you're considering this type of insurance.
Practical Takeaway: Long-term care insurance covers ongoing care services and support, not traditional medical treatment. The exact coverage depends on the specific policy chosen. Reading through the policy details or asking the insurance company to explain what is and isn't covered helps you understand what to expect.
Nursing Home and Assisted Living Facility Coverage
Nursing homes and assisted living facilities are two different settings, and AARP long-term care insurance policies typically cover both, though the extent of coverage may differ. A nursing home provides skilled nursing care, meaning a licensed nurse is on staff and medical oversight is constant. An assisted living facility offers a less medical environment where staff help with daily tasks like bathing, dressing, and meals, but round-the-clock nursing care is not provided.
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According to the American Health Care Association, the average cost of nursing home care was approximately $8,821 per month for a semi-private room and $10,014 for a private room as of recent data. These costs continue to rise yearly. Assisted living facilities typically cost less, averaging around $4,500 to $6,000 monthly, depending on location and services. Long-term care insurance can help pay these expenses, though the actual amount covered depends on the policy's daily or monthly benefit limit.
AARP policies usually specify a daily benefit amount. For example, a policy might cover up to $150 per day in a nursing home. This means if your daily cost is $300, the insurance pays $150 and you pay the rest. Some policies also have a maximum total benefit, such as $300,000 total over the lifetime of the policy. Once that maximum is reached, the insurance stops paying, and you pay all remaining costs yourself.
Facility coverage also depends on whether care is deemed medically necessary. Some policies require a physician's determination that skilled nursing care is needed before they will pay. Others are more flexible and cover care in these settings based on different criteria. The policy language spells out these requirements, so understanding them beforehand prevents surprises when you need to file a claim.
It's also important to note that coverage may be limited if you don't meet the policy's definition of "needing care." Many policies require that you need help with a certain number of daily living activities—such as bathing, dressing, eating, toileting, transferring (moving from bed to chair), or continence—before benefits begin. This is called a functional or medical trigger for benefits.
Practical Takeaway: Nursing homes and assisted living facilities are covered, but at different rates depending on your policy. Knowing your daily benefit limit and maximum lifetime benefit helps you understand how much the insurance will actually pay toward these often-expensive settings.
Home Care Services and In-Home Support
Many people prefer to receive care at home rather than move to a facility. AARP long-term care insurance policies typically include coverage for home care services, which is one reason these policies appeal to many people. Home care can range from a few hours per week to 24-hour live-in care, depending on what someone needs and what their policy covers.
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Home care services covered by long-term care insurance usually include personal care assistance—help with bathing, dressing, grooming, toileting, and eating. Some policies also cover homemaker services like light cleaning, laundry, meal preparation, and grocery shopping. In-home nursing care, physical therapy, and occupational therapy may be covered if medically necessary. Some policies cover adult day care centers, which provide supervision and activities during daytime hours while caregivers work or need a break.
The costs of home care vary widely based on location and the level of care needed. According to Genworth's 2023 Cost of Care Survey, home health aide services averaged about $27 to $32 per hour in many areas, while skilled nursing care at home cost considerably more, sometimes $100 to $200+ per hour. A policy with a daily benefit of $100 might cover several hours of home care services, depending on local rates.
Home care coverage often requires that a physician or care manager assess the person's needs and recommend specific services. The insurance company may then approve certain services and deny others. For instance, a policy might cover in-home physical therapy after surgery but not cover ongoing housekeeping. Understanding these boundaries helps explain why some home care costs may not be reimbursed.
One advantage of home care coverage is that it allows people to stay in their own homes, which many prefer. However, home care policies typically don't cover room and board costs if you're paying someone to live with you in your home. They cover the cost of the care service itself, not the expense of housing the caregiver. Additionally, home care policies generally require that a licensed care provider deliver the services, so paying a family member or friend may not be covered.
Practical Takeaway: Home care coverage can help pay for personal care and support services at home, which is often less expensive than facility care. However, coverage is limited to professional services and typically doesn't include housing costs for caregivers or payments to family members.
Respite Care, Adult Day Care, and Other Services
Beyond nursing homes and in-home care, AARP long-term care insurance policies may cover other services designed to support people with long-term care needs. Respite care is one important service. Respite care provides temporary relief for family members or primary caregivers by offering short-term care in a facility or at home. If a daughter has been caring for her aging mother full-time, respite care might cover several days or weeks of facility or in-home care to give the daughter a break.
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Adult day care centers are another covered service for many policies. These programs provide supervision, social activities, meals, and sometimes therapy services during daytime hours. A person might attend adult day care three days a week while living at home, and their long-term care policy may help pay for this. Adult day care typically costs $50 to $80 per day but provides valuable support and socialization for people who need monitoring during the day.
Some policies also cover transitional care services, which help someone move from one care setting to another. For example, if someone is discharged from the hospital and needs a week of care coordination and therapy before going home, some policies may cover this bridge period. Coverage for these services depends entirely on what the specific policy includes.
Other services that may be covered by some AARP long-term care policies include care coordination and case management, which involve a professional assessing needs and arranging services. Some policies cover hospice care, which provides comfort-focused care for people nearing the end of life. A few policies include coverage for emergency response systems, medical alert devices, or home modifications like grab bars or ramps, though these are less common additions.
The specific services your policy covers depend on the plan you choose. AARP works with multiple insurance carriers, and each carrier offers different policy options with varying coverage levels. It's important to review the policy details or speak with the insurance company to understand exactly which additional services are included and