Medicare Won’t Pay for Long-Term Care: Why Retirees Could Face a $115,000-a-Year Bill

Medicare generally does not pay for long-term care, which can include ongoing medical and nonmedical assistance for people with chronic illnesses or disabilities.

That distinction can become costly if retirees assume their Medicare coverage will handle extended care needs. Experts say long-term care typically requires a separate funding strategy, whether through Medicaid, long-term care insurance or personal savings, according to a report published by CNBC on Wednesday.

What Medicare Covers

There are circumstances in which Medicare can help pay for short-term skilled care. Medicare Part A may cover up to 100 days of skilled nursing facility care per benefit period after a qualifying inpatient hospital stay, provided other eligibility requirements are met.

That coverage is different from long-term nursing or custodial care. Medicare does not cover certain nursing facility care that does not follow a qualifying hospital stay.

The distinction matters because Medicare can help with some initial skilled care but is not designed to cover ongoing long-term care.

Medicare’s coverage gaps are already a concern for retirees facing rising healthcare costs. Recent coverage has noted that Medicare does not cover expenses such as long-term nursing home care, while premiums and other out-of-pocket healthcare costs can continue to put pressure on retirement income.

Medicare vs. Medicaid

There are generally three ways to pay for long-term care: Medicaid, insurance or self-funding.

Medicaid, rather than Medicare, is the primary payer for nursing facility care for eligible low-income people. Medicaid eligibility rules vary by state and can include limits on income and assets.

"People often confuse Medicare with Medicaid when it comes to long-term care," Carolyn McClanahan, a physician, certified financial planner and founder of Life Planning Partners in Jacksonville, Florida, told CNBC.

"Medicaid covers long-term care. Medicare covers some initial skilled care, but not ongoing long-term care."

Households that may qualify for Medicaid should understand their state’s rules before they need care. Others may consider long-term care insurance or plan to pay for care themselves.

"People assume Medicare is their long-term care plan," Jeff Judge, a certified financial planner and managing partner at Chesapeake Financial Planners in Forest Hill, Maryland, told CNBC.

"It isn’t, and finding that out during a crisis is the worst possible time."

Recent retirement research has also highlighted how retirees are underestimating healthcare costs. Retirees surveyed by Schroders reported spending 16% of their monthly income on healthcare, while 58% said they were caught off guard by those expenses.

The Planning Gap

The misunderstanding remains widespread. A new survey from the American Council of Life Insurers found that 39% of middle-class households expect to turn to Medicare to pay for long-term care.

The survey included 1,404 respondents from middle-class households with annual household incomes between $50,000 and $150,000. Nearly 20% said they plan to self-fund long-term care expenses.

The potential gap is particularly important because retirement healthcare estimates do not necessarily include long-term care. Fidelity’s 2026 estimate projected $185,500 in healthcare expenses for a 65-year-old enrolled in Original Medicare Parts A and B and Part D, but specifically excluded long-term care expenses.

The potential need for care is also significant. Someone turning 65 has a nearly 70% chance of needing some type of long-term care services, according to the Department of Health and Human Services data.

Long-term care can also be expensive. A semiprivate room in a nursing home may cost $114,975 annually, based on the national median daily rate of $315, according to a 2025 CareScout cost-of-care survey.

That makes planning important. Judge told CNBC that people should begin planning for long-term care in their 50s or 60s, rather than waiting until their 70s.

The key takeaway is that Medicare should not be viewed as a general long-term-care funding plan. People approaching retirement should understand what Medicare covers and consider whether Medicaid, insurance or personal savings may be appropriate for potential long-term care costs.

Disclaimer: This content was produced with the help of AI tools and was reviewed and published by Benzinga editors.

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