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Most Americans underestimate the risk of developing a disability and needing long-term services and supports (LTSS).  Using microsimulation modeling, we estimate that over half (56%) of Americans turning 65 today will develop a disability serious enough to require LTSS, although many will need assistance for less than three years.  About one in five of all adults (22%), however, will have a disability for more than five years.  On average, an American turning 65 today will incur $120,900 in future LTSS costs, measured in today’s dollars.  Families will pay more than one-third (37%) of the costs themselves out of pocket, with the rest covered by public programs and private insurance.  Although most people with LTSS needs will spend relatively little on their care, 14% will spend at least $100,000 out of pocket for future LTSS.  But these paid services do not cover all care people need, and consistent with prior research we find that family caregivers provide substantial unpaid care.  Valuing unpaid care contributions at the wage of a paid caregiver, we estimate that unpaid family care for older adults with significant disabilities who receive care is worth $204,000 on average, more than the expected cost of all paid LTSS.  Without help from unpaid family caregivers, families and public programs would spend much more on LTSS.

This Brief presents information about the risk of needing care and associated costs to provide content for policymakers and others considering long-term care financing proposals. It revises a brief that was written in October 2020. This research was conducted under contract HHSP233201600024I between HHS/ASPE’s Office of Behavioral Health, Disability, and Aging Policy (BHDAP) and the Urban Institute.


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