Long-Term Care Costs Are Affecting Inheritances. Here’s What Families Can Do About It.

In late July, The Washington Post published a detailed analysis of federal data tracking how Americans spend money in their final decade. The typical person who died between 2006 and 2022 spent about $19,000 out of pocket on care in those last years. As the Post noted, that figure does not include room and board at a care facility, which is often the largest expense. The range behind that number is wide: one in six spent more than $50,000, and one in twenty spent more than $100,000. For those who needed years of nursing home care, the costs ran far higher. The article’s conclusion was direct: the great wealth transfer that financial media has been discussing for years is largely a story about families at the very top. For middle-class families, retirement savings are being consumed by care costs, not passed on.

The reporting describes a problem that elder law attorneys see in their practice regularly. What families can do about it, particularly in New Jersey, is the focus here. Care costs in this state tend to run higher than national averages, and legal tools exist that many families don’t learn about until their options have narrowed.

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What the Analysis Found and What the Typical Figure Leaves Out

The piece’s central finding is important enough to restate precisely. The median out-of-pocket spending on care in the final decade of life was approximately $19,000. That number sounds manageable, but it leaves out facility room and board, and the distribution around it is wide. One in six spent more than $50,000. One in twenty spent more than $100,000. And for the subset who required sustained nursing home care, several years of care can consume a large share of a family’s savings.

A private nursing home room costs a national median of about $129,575 a year, according to the CareScout 2025 Cost of Care Survey. I

In New Jersey, costs run higher. The state’s own Medicaid program uses $420.67 a day, about $153,500 a year, as the average private cost of nursing home care as of April 1, 2026. Several years of care at those rates can consume savings that took a lifetime to build.

Research from the Roosevelt Institute found that long-term care costs permanently reduce the wealth of low- and middle-income families, while the highest earners tend to recover. The projected great wealth transfer, in other words, is increasingly concentrated at the top. For families in the middle, the wealth was real. The transfer may not happen the way they imagined.

Why This Lands Harder on Middle-Class Families

This is where middle-class families feel it most. Wealthy families can absorb years of care costs without exhausting their assets. Families with very limited assets qualify for Medicaid relatively quickly. The families caught in the most difficult position are those in the middle: people who built genuine wealth through decades of work, saving, and homeownership, but whose assets are not deep enough to sustain multiple years of institutional care at current rates.

According to the U.S. Department of Health and Human Services, 56 percent of Americans turning 65 will develop a disability serious enough to require long-term services and supports. Only 15 percent of Americans 65 and older carry long-term care insurance to help cover those costs, according to the Post’s reporting. Many families assume Medicare will cover nursing home care. Medicare generally does not pay for long-term custodial care. It covers only limited skilled nursing facility care, for up to 100 days, when certain conditions are met. That gap is where many middle-class families’ savings end up going.

In New Jersey specifically, the state’s Medicaid program covers long-term institutional care for qualifying individuals, but eligibility requires meeting income and asset thresholds that are, by design, low. For families with savings, investments, a home, or other assets, Medicaid eligibility can be complex. How particular assets are treated depends on the circumstances and applicable Medicaid rules.

What the Planning Tools Actually Look Like

The article that prompted this commentary is largely a diagnosis. It documents the problem with precision and quotes sources on the gaps in how long-term care is funded in the United States. What it does not walk through is what families in New Jersey can do within the current system to reduce their exposure.

Medicaid planning, done in advance, is a tool worth understanding for middle-class families in this state. For some families, advance planning may include an appropriately structured irrevocable trust. New Jersey generally applies a five-year lookback to certain asset transfers for long-term-care Medicaid eligibility, and transfers during that period can result in a period of ineligibility. Whether a trust or transfer strategy is appropriate depends on timing, the assets involved, the terms of the arrangement, and the family’s circumstances.

Long-term care insurance, where it remains available and the premiums are manageable, is another option worth exploring before health changes make coverage unavailable. The Post’s finding that only 15 percent of older Americans carry this coverage reflects both the cost of the policies and the fact that most families do not think seriously about long-term care risk until it is already present.

Spousal protections under Medicaid are also relevant for married couples in New Jersey. Federal and state rules allow a community spouse, the spouse who does not need institutional care, to retain a portion of the couple’s assets and continue receiving income during the Medicaid application and eligibility period. These protections are meaningful, but they require understanding and application. They do not happen automatically.

It is worth being direct about what these tools cannot do. Medicaid planning is not a mechanism for preserving an entire estate while the government pays for all care. The planning tools that exist operate within the rules of a system that is designed to serve people who genuinely need public support. What they can do, used thoughtfully and in advance, is help a family avoid the worst outcomes, reduce unnecessary spend-down, and maintain some meaningful ability to pass something on to the next generation.

The Timing Problem Is the Real Problem

The cost figures point to a timing problem. In our experience, most families begin thinking about long-term care planning only after a diagnosis, a hospitalization, or a facility admission is already underway. By that point, the options have narrowed considerably.

Once a long-term-care need has arisen, the five-year lookback can limit certain advance-planning strategies, although other planning options may still be available depending on the circumstances. Long-term care insurance typically cannot be purchased once a significant health condition has developed. A power of attorney cannot be executed after capacity is lost. The care conversation, in other words, belongs in the years before anything has gone wrong, not in the weeks after it has.

The piece describes families confronting these costs in real time, with limited options and limited preparation. That is the common experience. It does not have to be the only one. Starting the conversation earlier can give families more time to understand their options and make informed decisions before a crisis limits their flexibility.

Plan Well. Live Better.

The Washington Post’s reporting names a problem that is real and growing. At Milvidskiy Law Group, we help New Jersey families understand where they stand, what tools exist within the current system, and how to use the time available to them before a care crisis arrives and narrows the field. Learn more about our Medicaid planning services or explore how we approach elder law planning for aging families.

This article is for informational purposes only and does not constitute legal advice. The cost figures cited are from the CareScout 2025 Cost of Care Survey, New Jersey Medicaid Communication 26-04, and the HHS Office of the Assistant Secretary for Planning and Evaluation, verified in September 2026. Medicaid eligibility rules, long-term care costs, and applicable law are subject to change and vary by state. What is right for one family may not be right for another. We encourage you to speak with a qualified attorney to discuss your specific situation.