long-term care insurance (LTCI)

Long-term care insurance (LTCI) is a form of health insurance that provides benefits for a chronically ill or disabled individual over an extended period of time.

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Long-term care (LTC) coverage provides funds for nursing-home care, home-health care, personal, or adult day care. Most LTCI policies will cover only a specific dollar amount for each day spent in a nursing facility or for each home-care visit. Federal legislation in 1996 established what is termed "tax-qualified long-term care insurance" and standardized coverage to qualify for the tax-deductible plan. Most LTC coverage is written to comply with the federal plan. LTCI policies are either "tax-qualified" or "non-tax-qualified," and there can be significant differences between the two. Standard LTC is often referred to as non-qualified LTCI.