Long term care insurance (LTCI) is typically purchased by people in their 40s, 50s, and 60s planning for the care they may need decades from now. Although it serves as a very challenging task for LTCI companies and actuaries to create products that will meet the needs of an unknowable future, it's not impossible.
As an example of how the future may affect long term care, consider a recent story found on the BBC news website: "Japan may pick robots over immigrants," which included a video of a very realistic-looking robot. The gist of the story is that Japan is facing a population crisis and rising concern over who is going to care for a larger older population, and most Japanese are hesitant to increase their immigrant population in order to pick up the slack. In the United States, however, we have a strong history of encouraging immigration, but economic conditions and political gridlock may mean we'll face a shortage of available workers in the future.
For a real-life example of how a shortage of caregivers can affect costs, consider that according to the 2010 Genworth Cost of Care Survey, the most expensive home health care is in Alaska, where it can be difficult to attract home health care workers.
The same survey from Genworth also recorded the five-year annual growth in the cost of licensed home health aide services: a growth rate of only 1.7 percent, as high unemployment means that people will look for even modest-paying jobs such as home health care.
