Does Long-Term Care Insurance Cover Nursing Homes in 2026?
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Key takeaways
- Long-term care insurance can pay for nursing home care, but what it pays depends on the policy. ACL says policies typically let the daily benefit be used in nursing homes and other settings.
- Medicare and most health insurance, including Medigap, don't pay for long-term care services such as care in a nursing home, according to Medicare.gov.
- A policy pays after you meet its benefit triggers and wait out its elimination period, a waiting period measured in days during which you pay for care.
- In states with a Long-Term Care Partnership program, Medicaid disregards assets equal to the benefits a qualifying policy has paid.
- For 2026, the IRS lets premiums for a tax-qualified policy count as medical expenses up to age-based limits of $500 to $6,200.
Short answer
Long-term care insurance can pay for nursing home care, but what it pays depends on the policy. The federal Administration for Community Living (ACL) says policies typically let you use the daily benefit in a range of settings, including nursing homes. Medicare and Medigap, by contrast, don't pay for long-term care in a nursing home.
To see what homes near you report to CMS, search by name, city or ZIP code on the nursing home search page, then compare homes side by side.
What is long-term care insurance?
Long-term care insurance is a private policy designed to pay for long-term services and supports. ACL says that, unlike traditional health insurance, it is designed to cover care in settings such as your home, a community organization or another facility.
Medicare.gov describes long-term care (also called custodial care) as care for people with a chronic illness or disability, mostly help with everyday tasks called activities of daily living.
Does long-term care insurance cover nursing home stays?
Policies typically can, but each policy sets its own terms. ACL says policies typically allow the daily benefit to be used in settings including:
- Nursing homes
- Assisted living facilities (also called residential care or alternate care facilities)
- Alzheimer's special care facilities
- Your home, adult day service centers, hospice care and respite care
The Texas Department of Insurance (TDI) also lists care in a nursing home or assisted living center among the types of care long-term care insurance pays for. TDI notes that some limited or short-term recovery policies may require a hospital stay before you go to a nursing home. If you are weighing settings, see nursing home vs. assisted living: care, cost and who pays.
When does a long-term care policy start paying?
A policy starts paying after you meet its "benefit triggers" and then wait out its "elimination period." ACL says benefit triggers are the criteria an insurance company uses to decide whether you are eligible for benefits. They are usually based on activities of daily living or cognitive impairment, and are determined through a nurse or social worker assessment sponsored by the company.
ACL says the elimination period is the time that must pass after a benefit trigger occurs before you start receiving payment. It is like a car insurance deductible, except it is measured in time rather than dollars. During that period you must cover the cost of any services you receive. ACL adds that some policies require you to receive paid care or pay for services during that time for it to count toward the elimination period.
| Source | What it says about the waiting period |
|---|---|
| ACL (federal) | Time after a benefit trigger before payment starts; you pay for care during it |
| Texas Department of Insurance | For most policies, a wait of 30 to 180 days; some policies count service days |
What does "tax-qualified" mean for a long-term care policy?
A tax-qualified policy is one that meets the rules in federal tax law (26 U.S.C. § 7702B). Under that law, a tax-qualified contract must, among other things, cover only qualified long-term care services, be guaranteed renewable, and meet consumer protection requirements. TDI says that if a policy is tax-qualified, it will say so in the policy.
Under the law, the person must be "chronically ill." That means a licensed health care practitioner has certified, within the past 12 months, that the person:
- cannot do at least 2 activities of daily living without substantial help, for a period of at least 90 days, due to a loss of functional capacity,
- has a similar level of disability, as determined under federal regulations, or
- needs substantial supervision to protect their health and safety because of severe cognitive impairment.
The six activities of daily living in the law are eating, toileting, transferring, bathing, dressing and continence, and a policy must take into account at least 5 of them. The 90 days describes how long the loss of ability lasts; it is a separate idea from a policy's elimination period. The care must also follow a plan of care prescribed by a licensed health care practitioner, such as a physician, registered professional nurse or licensed social worker.
How does long-term care insurance fit with Medicare and Medicaid?
Medicare.gov says Medicare doesn't pay for long-term care. It says that since most long-term care is non-medical, Medicare and most health insurance, including Medicare Supplement Insurance (Medigap), don't pay for long-term care services, including care in a nursing home. Medicare.gov says Medicare can cover short-term skilled nursing facility care after a qualifying inpatient hospital stay; see does Medicare pay for a nursing home.
Federal tax law also says a tax-qualified contract generally does not pay for services to the extent Medicare would pay for them, or would pay except for a deductible or coinsurance.
Medicare.gov names two other ways to pay for long-term care: Medicaid, if you meet your state's eligibility rules, or private long-term care insurance you choose to buy. See how Medicaid pays for a nursing home.
Long-Term Care Partnership policies
Federal Medicaid law lets states run a Long-Term Care Partnership program. In a state with an approved program, Medicaid disregards assets equal to the insurance benefits a qualifying policy has paid. TDI puts it this way: Medicaid will disregard one dollar of your assets for every dollar your policy pays in benefits. For Texas, TDI says these assets "also are protected from Medicaid liens and recoveries after you die."
Among the federal conditions, the insured must have lived in the state when coverage began, and the policy must be tax-qualified and issued on or after the date of the state's program. For Medicaid asset rules, see Medicaid's 5-year look-back and Medicaid liens and estate recovery.
How much does nursing home care cost?
The 2025 national median is $9,581 a month for a semi-private room and $10,798 for a private room, according to the CareScout Cost of Care Survey. You can look up homes by state, for example on the Texas nursing homes page.
What are the 2026 tax rules for long-term care insurance?
Premiums for a tax-qualified policy can count as medical expenses, up to an age-based limit. For 2026, the IRS limits are:
| Age at end of the tax year | Most of the premium that counts (2026) |
|---|---|
| 40 or under | $500 |
| 41 to 50 | $930 |
| 51 to 60 | $1,860 |
| 61 to 70 | $4,960 |
| Over 70 | $6,200 |
- The 7.5% floor. Federal law allows the itemized medical expense deduction only for total medical expenses above 7.5% of adjusted gross income.
- Nursing home costs. IRS Publication 502 says you can include the cost of medical care in a nursing home in medical expenses. This includes meals and lodging if a principal reason for being there is to get medical care.
- Benefits. Federal law treats amounts received under a qualified contract (other than policyholder dividends or premium refunds) as reimbursement for medical care expenses.
- The $430 per diem limit. For 2026, the IRS per diem limitation for periodic payments under a qualified contract is $430 a day. This is a tax limit, not a benefit amount a policy must pay.
- Retirement plan money. IRS Notice 2026-33 says that, for distributions made after December 29, 2025, a 401(k), 403(b) or governmental 457(b) plan may, but does not have to, allow distributions to pay for certified long-term care insurance. IRAs are not eligible. For 2026 the yearly amount is limited to the least of premiums paid, 10% of the vested balance, or $2,600. The money is generally taxable, but the 10% additional tax on early distributions generally does not apply.
Can long-term care insurance premiums go up?
Yes. ACL notes that the insurance company may raise the premium on your policy. As a Texas example only, TDI says:
- Insurance companies can raise rates only if they raise them for everyone with the same policy, and must give at least 45 days' notice.
- Companies must give you at least 30 days to look over your policy after you get it.
- A company must renew your policy each year if you want it to, with some exceptions such as unpaid premiums.
Where to get official help with long-term care insurance
ACL says to contact your state's Department of Insurance to find out whether your state offers a partnership program and which insurance companies offer long-term care coverage in your state.
- Texas residents: the Texas Department of Insurance Help Line is 800-252-3439. Other states' insurance departments have their own numbers.
- Medicaid eligibility: your state Medicaid agency handles applications.
- Tax questions: IRS Publication 502 explains medical expense rules.