Long-term care is the single largest unfunded retirement expense most households will face, and the average divorce barely mentions it. Health insurance gets a paragraph in the decree. Life insurance gets a section. Long-term care insurance, when it is in place, often gets one line that says the policy will be “divided per the carrier’s procedures,” which on a joint or shared policy may not be possible. The functional reality is that two newly-single retirees in their seventies, each of whom may need three to six years of professional care in their eighties, can together face a million dollars or more of long-term care costs neither household is financially prepared to absorb. When the costs hit, the adult children become the safety net by default, which is rarely what either parent or the children themselves would have chosen with proper planning.
What follows is a working guide to long-term care planning in divorce for the Divorce Financial Coach, family lawyer, or financial planner navigating a case where one or both spouses are at an age where the question warrants explicit treatment. It covers the cost reality of contemporary long-term care, how to estimate the future expense per spouse, the structural questions on existing LTC insurance policies, the hybrid life-or-annuity policies that resist clean splitting, the Medicaid question and why it is not a real plan for most households, and the operational provisions that should appear in the decree.
What long-term care actually is — and what is not covered.
Long-term care is personal, custodial, non-medical care provided to a person who can no longer perform the activities of daily living independently. It is not skilled medical care. It is not the care that follows a heart attack or a hip replacement. It is the care needed when a person can no longer bathe themselves safely, dress themselves, move from bed to chair, use the toilet without help, or eat without assistance — or when cognitive impairment from Alzheimer’s, dementia, or head injury requires constant supervision.
Three categories of impairment trigger the need for long-term care. Cognitive impairment from progressive neurological disease (Alzheimer’s, vascular dementia, Parkinson’s-related dementia, Lewy body dementia, frontotemporal dementia) or acute event (head injury, stroke with cognitive sequelae) requires supervision regardless of the patient’s physical capacity. Physical impairment measured by activities of daily living — typically requiring assistance with two of six ADLs (bathing, dressing, transferring, toileting, continence, eating) — qualifies for most insurance and Medicaid definitions of needing long-term care. Hands-on assistance is required for the most impaired patients; stand-by assistance suffices for less impaired patients.
Health insurance does not cover long-term care. Medicare does not cover long-term care. Medicare may pay for up to one hundred days of skilled rehabilitative care following a qualifying hospital admission (in practice, most discharged patients receive twenty to forty days), but the care must be skilled — provided by a licensed clinician — and rehabilitative. Custodial care that does not improve the patient’s condition is not covered. Once the rehabilitation potential is exhausted, Medicare ends and the household pays out of pocket until either private long-term care insurance engages or the household’s assets are exhausted to the Medicaid eligibility threshold.
Long-term care is not a place. It is an event. The event begins when the person needs help, and it can run for months or years before death. The location of the care matters less than the fact of the care: home care, adult day care, assisted living, memory care, or nursing home all qualify as long-term care settings. The setting choice is driven by the patient’s needs, the family’s resources, and the local availability of options.
What the care actually costs.
The Genworth Cost of Care Survey and similar annual surveys track the cost of professional long-term care services across the United States. As of 2023-2024 data, with post-COVID adjustments, the typical costs run roughly as follows.
Home care delivered by a professional caregiver averages $30 to $35 per hour in most of the United States, up from approximately $27 per hour pre-COVID. Forty hours per week of home care runs $5,000 to $6,000 per month. Twenty-four-hour home care — for patients who cannot safely be left alone — runs substantially higher, often $15,000 to $25,000 per month depending on geography and the level of nursing skill required.
Assisted living facilities have a national average base rate of approximately $4,500 to $5,500 per month. The base rate covers room, board, and a minimum level of care. Most residents need additional care beyond the base, with level-of-care surcharges adding 25% to 50%. Memory care units add another 30% to 50% over the assisted living base. A resident in memory care at an above-average geographic market may be paying $8,000 to $12,000 per month.
Nursing home private rooms average approximately $9,000 per month nationally, with substantial variation by region (low end in rural Midwest, $6,000; high end in urban Northeast or California, $14,000 to $18,000). The nursing home setting should not be the primary planning focus because most people prefer home care or assisted living when possible, but for the most impaired patients the nursing home becomes the only viable setting.
Estimating the future cost of care for each spouse.
The planning calculation requires today’s cost, inflation projection (3-5% per year is the typical range for long-term care costs, with recent years running higher), the patient’s age at expected care start (average is approximately 80 for both genders), and the expected duration of the care event.
Long-term care insurance industry claims data provides the duration estimates. Male claimants average 2.5 years of care; among males whose care lasts more than one year, the average duration is approximately four years. Female claimants average 3.5 years of care; among females whose care lasts more than one year, the average duration is approximately six years. The gender difference reflects longevity differences and the higher prevalence of dementia in older female populations.
A worked example. A 55-year-old couple, both expected to need care starting at age 80. Current cost of professional care $5,000 per month. With 3% inflation, the same care will cost $10,500 per month in twenty-five years. The male spouse’s expected care duration is three years (minimum), producing a total nominal care cost of approximately $388,000 ($10,500 × 36 months, ignoring intra-period inflation). The female spouse’s expected care duration is five years, producing approximately $667,000.
The nominal future cost is the planning target. To express it in present-value terms for property division purposes, discount at a reasonable rate (6% is a common choice). The male’s $388,000 in twenty-five years has a present value of approximately $76,000. The female’s $667,000 has a present value of approximately $130,000. The combined household exposure, in present-value terms, is approximately $206,000 — a significant line item that rarely appears on the marital balance sheet.
The numbers are illustrative; specific cases require region-specific cost inputs and household-specific duration estimates. The point is that long-term care is a meaningful, quantifiable, and almost universally under-acknowledged future cost that has to be planned around in any divorce involving spouses in their fifties or older.
Long-term care insurance as part of the planning architecture.
Traditional long-term care insurance is purchased before care is needed and pays a defined daily or monthly benefit when the policyholder meets the policy’s care-qualification standards (typically inability to perform two of six ADLs without substantial assistance, or cognitive impairment requiring substantial supervision). Premiums are paid until the policyholder begins claiming benefits.
Illustrative pricing for a 55-year-old couple buying traditional LTCI in 2023-2024 (national averages, varies substantially by state and carrier): a $5,000 per month starting benefit with 3% inflation protection. Male, 3-year benefit period (covering the typical claim duration): approximately $185 per month premium. Female, 5-year benefit period: approximately $410 per month premium. Combined household premium $595 per month, or approximately $7,000 per year. The premium continues until claim, with the prospect of substantial future premium increases (the LTCI industry has a difficult historical pricing record and has imposed substantial rate increases on many in-force policies over the past two decades).
Hybrid policies — life insurance with long-term care riders, or annuities with long-term care riders — are the alternative product class that has largely replaced traditional LTCI in current sales. The structural appeal of hybrid policies is that they have a cash value (so the premium is not “lost” if the policyholder never claims benefits), the premium is typically guaranteed not to increase, and the death benefit (on life-linked products) pays whatever benefits were not consumed by long-term care claims. The trade-off is meaningfully higher upfront premiums, often paid as a single premium or over a five-to-ten-year period rather than for life.
The structural questions for couples with existing LTC insurance.
Many divorcing couples in their fifties and sixties have existing LTC insurance, purchased at some point during the marriage when the household made the decision to insure against the eventual care risk. Several structural questions surface when the marriage ends.
Who pays the ongoing premiums after divorce? LTCI premiums are typically several thousand to ten thousand-plus dollars per year per insured, payable indefinitely until claim. The decree should specify who pays for each spouse’s policy — either each spouse pays their own, or one spouse pays both (often with offsetting adjustments elsewhere in the settlement), or the premiums are funded from a specific source defined in the decree. Treating LTCI premiums the way health insurance premiums are treated in the decree — as an ongoing critical expense to be continued — is the right framing.
What happens to the policies if one spouse stops paying? Lapsed coverage is the worst outcome — the policyholder loses all the value that has been paid in over years and is left without the protection the policy was supposed to provide. The decree should specify a default consequence (typically the non-paying spouse becomes liable for replacement coverage), and the third-party lapse notification on the policy should be updated to ensure the other spouse is notified before the policy lapses.
How does the future benefit interact with the support structure? If the LTCI policy on one spouse eventually pays out, the benefits typically supplement the spouse’s own income to fund their care. The non-paying spouse and any children are protected from the personal consequences of needing to provide care themselves. The provision is particularly important when there are adult children — without the financial provision, the children may be compelled to provide care, which most children would not have chosen and which most parents would not have wanted to impose.
Split billing and addresses of record are important operational details. Each spouse’s policy should have separate billing to that spouse’s address after divorce. Joint billing to a single address typically continues by default and can produce missed payments when the parties’ communication breaks down.
Joint or shared LTC policies — and the splitting question.
Many LTC policies sold to couples are joint or shared policies — a single policy covering both spouses, with a combined pool of benefit days that either spouse can draw on. Joint policies offer lower combined premiums than two separate policies and provide structural protection if one spouse needs substantially more care than the other (the unused benefits of the lower-claim spouse become available to the higher-claim spouse).
Joint policies often can be split into two separate contracts via an administrative process with the carrier. The process timing varies — some carriers process splits within thirty days, others require months. The decree should specify that the policies will be split via the carrier’s procedures within a defined timeframe, and the splitting administrative cost (if any) should be allocated between the parties.
Not all joint policies can be split. Some carriers’ contracts do not provide for splitting at all; the policy is a single contract that cannot be divided. When the coverage cannot be split, the decree must address ongoing premium responsibility, the agreement not to share benefits in ways that disadvantage one spouse, and the operational provisions for managing the policy on behalf of both spouses going forward.
Hybrid policies — the cash value, beneficiary, and ownership questions.
Hybrid LTC policies (life-linked or annuity-linked) introduce additional complexity in divorce. Three structural questions recur.
First, there is a cash value that has to be accounted for on the balance sheet. Unlike traditional LTCI, where the premium is effectively gone if benefits are never claimed, hybrid policies retain a cash value that represents either a portion of paid premiums plus accumulation or a defined surrender value under the policy terms. The cash value is a marital asset that has to be valued and allocated like any other asset.
Second, if the hybrid policy is life-insurance-linked, the death benefit beneficiary designation has to be updated. The default beneficiary is typically the spouse, which after divorce is rarely the intended outcome. The decree should specify who the new beneficiary will be (typically the children, or a trust for the children) and require the policyholder to execute the beneficiary change within a defined period after the decree. Note that LTC claims reduce the death benefit dollar-for-dollar in most hybrid products; the death benefit available at death depends on how much LTC benefit was used during life.
Third, joint or shared hybrid LTCI typically cannot be split into separate contracts. The hybrid structure usually has a single owner (often just one spouse, even on a policy covering both lives), a single beneficiary, and a single contract. The decree must address who the owner is going forward, who pays the ongoing premium, what beneficiary changes will be made, and how the parties will jointly manage a contract that they each have an interest in but only one of them controls.
The risk patterns specific to hybrid policies in divorce include the non-owner spouse’s exposure to the owner spouse raiding the cash value or lapsing the coverage entirely. A written agreement covering ongoing maintenance and management of the policy should be incorporated into the decree, with default consequences for violation that the parties can actually enforce.
Medicaid as a fallback — and why it is not a real plan.
Some households reach divorce without LTC insurance, without the resources to fund care out of pocket, and with the implicit assumption that Medicaid will eventually pick up the cost. The assumption has several structural problems that should be made explicit in the planning conversation.
Medicaid is crisis planning, not legitimate forward planning. The eligibility thresholds are tight — for a single person, countable assets must be below approximately $2,000; for a married couple, the combined community spouse resource allowance varied between approximately $31,584 and $157,920 in 2025 depending on state. The house is non-countable for a married couple while the community spouse is living in it, but becomes countable after the community spouse’s death or move. Most households with meaningful retirement savings, home equity, or business interests do not qualify for Medicaid until they have spent down substantially.
Medicaid primarily covers nursing home care. Coverage of home and community-based services has expanded under the Affordable Care Act’s Section 2404, but the home-based options are not universally available and the eligible services are typically more limited than what a privately-funded plan would provide. Most patients prefer to age in place when possible, and the Medicaid pathway often forces nursing-home placement that the patient would not have chosen.
Medicaid is not a legitimate plan for future care for most households. It is the fallback when other plans fail. The planning conversation should treat it as such and should not allow the assumption that Medicaid will solve the problem to defer the real conversation about how each spouse will pay for their care.
Medicaid divorce — when it is appropriate and when it is not.
Medicaid divorce — divorcing specifically to allocate assets in a way that allows one spouse to qualify for Medicaid while preserving assets for the other — is covered in detail in the companion piece on Medicaid planning and divorce. The structural takeaway for this context is that Medicaid divorce works only when the divorce is real (separate residences, separate financial lives), only when the asset division is not impoverishing to either spouse, and only when there is no prenuptial agreement that Medicaid will respect.
Two structural points specific to the LTC context. First, if there is a prenuptial agreement, Medicaid ignores all prenup provisions if the couple remains married. The couple’s combined assets are evaluated against the Medicaid threshold regardless of how the prenup allocated them. Medicaid allows divorce according to a legitimate prenup — meaning the divorce can transfer the assets per the prenup terms without triggering a Medicaid transfer penalty — only if the divorce is actually consummated. The prenup-plus-divorce combination is structurally powerful but requires that both pieces be in place and both be real.
Second, Medicaid divorce cannot impoverish one spouse. Asset divisions running 80/20 or 90/10 to favor the community spouse are sometimes approved by courts but require a defensible factual basis. The conservative posture is to allocate 50/50 or 60/40 and document the community spouse’s continued need. More aggressive allocations require more documentation and more risk of challenge.
What should appear in the decree.
Eight operational provisions belong in any decree involving spouses old enough to warrant explicit LTC planning.
An inventory of existing LTC and hybrid policies covering either spouse, including carrier, policy number, current cash value (if hybrid), current benefits (daily, monthly, lifetime), inflation protection terms, and beneficiary designation. A specification of how each policy will be split, transferred, or managed post-divorce — including the carrier’s required procedure and the timeline for completion. An allocation of ongoing premium responsibility for each policy, with payment instructions and consequence for non-payment. An update to the third-party lapse notification on each policy so the non-paying spouse is notified before lapse can occur. Beneficiary designation updates for hybrid policies with a defined deadline. A coordination provision specifying how the parties will communicate about the policies going forward (annual review, sharing of carrier correspondence, joint participation in any policy decision affecting the other party’s interest). If no LTC insurance is currently in place, an acknowledgment of the unfunded future care exposure with each spouse’s plan for addressing it. A provision for review of the LTC arrangements at defined intervals (typically every five years) to ensure the structure still works as the parties age.
Each provision protects both parties. The cost of including them at drafting is low. The cost of resolving them later, after a care event has begun, is enormous.
How VennBoard supports long-running LTC planning.
Long-term care planning is a multi-decade obligation. The decree provisions are typically the start of an arrangement that will run for thirty to forty years before claims begin, with periodic reviews, policy updates, premium changes, and beneficiary adjustments along the way. A planning file that begins clean at the decree falls apart within a decade unless someone is responsible for keeping it current.
VennBoard maintains the matter workspace beyond decree, tracking the LTC inventory as structured obligations rather than buried in paragraphs. The annual premium payments are tracked, the periodic carrier correspondence is uploaded as it arrives, the beneficiary designations are maintained as live documents that can be reviewed and updated as the parties’ circumstances change. Built-in reminders surface when annual review is due, when premiums are approaching their next change, and when the parties are approaching age milestones (65, 70, 75) where the plan should be re-evaluated.
Two operational features matter beyond document management. The shared expense tracking captures the ongoing premium payments and any cost-sharing arrangements between the former spouses, producing a clean record of who paid what and when. The immutable messaging log between the former spouses (and between each spouse and the financial planner or Divorce Financial Coach) captures the documented communications about policy management decisions, which protects both parties when the policies eventually do pay out.
Long-term care is the most consequential planning area most divorces leave under-addressed. VennBoard exists to make sure the planning that is set up at decree remains in place across the decades during which it has to function. Professional walkthrough at VennBoard.com, product detail at VennBoard.com.