FLTCIP 2026: Federal Long Term Care Insurance — Current Status and What to Do Now

Seventy percent of people who reach age 65 will need some form of long-term care.¹ For federal employees, that risk collides with an inconvenient truth: the Federal Long Term Care Insurance Program (FLTCIP) — the group LTC insurance program available to federal employees — has been closed to new enrollees since December 2022, and the suspension has now been extended through at least December 19, 2026.

If you're a federal employee who hasn't enrolled in FLTCIP, you can't. If you're enrolled and want to increase your coverage, you can't do that either. This guide explains exactly where things stand, what FLTCIP covers, what Medicare and FEHB do not cover, and how to plan for long-term care costs using your TSP and other tools while the program remains closed.

Current FLTCIP Status (2026)

OPM first suspended new FLTCIP applications on December 19, 2022, citing "ongoing volatility in long-term care costs and a diminished insurance market." On December 19, 2024, OPM extended the suspension for another 24 months — through at least December 19, 2026.²

What the suspension means in practice:

• Current FLTCIP enrollees: Your coverage continues unchanged. Premiums and benefits remain in force.
• Current FLTCIP enrollees who want to increase benefits: You cannot apply for higher daily benefit amounts or a longer benefit period during the suspension.
• Federal employees not currently enrolled: You cannot apply for new coverage until the suspension lifts. There is no workaround or hardship exception.
• Family members of federal employees: Spouses, domestic partners, parents, parents-in-law — same rules apply. No new enrollment while suspended.

Why is this happening? LTC insurance has been under severe financial stress industry-wide for over a decade. Insurers systematically underpriced policies written in the 1990s and 2000s because they underestimated how long policyholders would live and how much care would cost. Many carriers have exited the market entirely. When OPM solicited bids for the next FLTCIP contract, only one carrier — John Hancock Life & Health Insurance Company (through its subsidiary FedPoint, which operates as Long Term Care Partners LLC) — submitted a bid.³ With a single-bidder market and rising LTC costs, OPM concluded that reopening enrollment without a competitive contract in place was not in the program's best interest.

When might it reopen? The suspension runs through December 19, 2026 — but that is not a guaranteed reopening date; it's an expiration date for the current suspension. OPM could extend again if no new contract is in place. Federal employees who want to enroll should monitor OPM.gov and NARFE announcements in late 2026.

What FLTCIP Covered — and Will Cover If It Reopens

Understanding the program matters now for two reasons: current enrollees are making decisions with existing coverage, and federal employees who can enroll when it reopens should know what they're buying.

Coverage benefits

FLTCIP pays for long-term care services that Medicare and FEHB typically don't cover — specifically, custodial care: help with activities of daily living (ADLs) like bathing, dressing, eating, and moving around. Covered settings include:

• In-home care (professional home health aide)
• Assisted living facilities
• Nursing homes (skilled and custodial)
• Adult day care centers
• Other community-based care programs

FLTCIP 3.0 plan structure

One practical note: if your daily care cost is less than your DBA, the unused daily benefit extends your effective coverage period. A 3-year benefit with a $300/day DBA on a $200/day home care bill effectively lasts 4.5 years.

Who is eligible to enroll (when the program reopens)

FLTCIP eligibility extends beyond active employees. Eligible individuals include:

• Current federal employees and U.S. Postal Service employees
• Federal and USPS retirees
• Active and retired members of the uniformed services
• Spouses and domestic partners of the above
• Parents and parents-in-law of active federal employees (not retirees)
• Adult children (18+) of the above

Enrollment requires medical underwriting — coverage is not guaranteed. Applying at a younger age when health is better increases the likelihood of approval and results in lower premiums.

The LTC Cost Problem in 2026

Long-term care is expensive and getting more expensive fast. If you're planning for retirement 10–20 years from now, the cost you'll face is considerably higher than today's already-high numbers.

LTC costs are rising at 4–8% per year — well above general inflation. Nursing home costs rose 4.6% from May 2025 to May 2026; home care costs jumped 7.9% over the same period.⁴

The average LTC stay is roughly 2–3 years, but Alzheimer's and dementia cases often run 7–10 years. Planning for 3 years is a reasonable midpoint; planning for 5 years gives meaningful margin.

The math for a federal employee retiring today at 62:

• Expected LTC need age: ~80 (18 years away)
• A 3-year assisted-living stay today: $212,400
• Same stay projected at age 80 at 5% annual LTC inflation: approximately $510,000
• A 3-year nursing home stay today: $406,000
• Projected at age 80: approximately $976,000

That is a very large number against a $1.4M TSP. Without a plan, a nursing home stay could consume most of a federal retiree's investment assets.

Why Medicare and FEHB Don't Cover This

This is the most important thing federal employees misunderstand about LTC costs.

Medicare

Medicare covers skilled nursing care following a qualifying hospital stay of at least 3 days. It covers up to 100 days of skilled nursing facility care per benefit period — but with increasing copays from day 21 onward ($204.50/day in 2026), and absolutely nothing after day 100.

Medicare does not cover custodial care — the ongoing help with bathing, dressing, eating, and moving around that constitutes most of what people actually need in long-term care. Once you don't require skilled nursing intervention (which most LTC residents don't, most of the time), Medicare's clock has already run out.

Home health benefits under Medicare require intermittent skilled care — not ongoing home aide services. A daily home health aide for a stable dementia patient is custodial care and is not covered by Medicare.

FEHB

Federal Employees Health Benefits is health insurance. Like Medicare, it covers medical services, hospitalizations, and skilled nursing care — not custodial care. An FEHB policy cannot substitute for LTC insurance. Enrollees who rely on FEHB and expect it to cover nursing home costs are in for a costly surprise.

For more on FEHB in retirement, see the FEHB in retirement guide.

Your Four Options While FLTCIP Is Suspended

Option 1: Self-Insurance via Your TSP

Self-insurance is the deliberate decision to pay LTC costs out of pocket rather than buy insurance. It only works if you have sufficient assets to cover a realistic LTC scenario without depleting your entire retirement savings.

Federal employees have a significant structural advantage here that private-sector retirees don't: the FERS pension. If your FERS pension and Social Security together cover your regular living expenses, your TSP doesn't need to generate ongoing income — it can sit largely intact as a reserve. That reserve can absorb a multi-year LTC event without affecting your daily financial life.

Consider a federal retiree at 65 with:

• $3,200/month FERS pension
• $2,000/month Social Security
• $1.4M TSP

Monthly expenses of $4,500 are covered by pension + SS. The TSP is untouched for normal expenses. If LTC becomes necessary at age 80, the TSP (now potentially $2M+ after 15 years of growth) can cover $5,900–$11,000/month without disrupting the pension or Social Security income streams.

Self-insurance doesn't work for everyone. Federal employees whose pension and Social Security don't fully cover living expenses, or whose TSP balance is modest (under $500K), face more exposure. In those cases, insurance is a more appropriate hedge.

Option 2: Private LTC Insurance

Private LTC insurance is still available from a small number of carriers — Mutual of Omaha, Transamerica, and a handful of others — but the market has contracted significantly. Many insurers have exited the business, and premiums on new policies are substantially higher than policies written 15–20 years ago, reflecting the industry's experience with underpricing.

What you need to know:

• Apply in your 50s. Premiums increase sharply with age, and health underwriting becomes more restrictive. A 55-year-old in good health can qualify for significantly lower premiums than a 65-year-old with any meaningful health history.
• Expect premium increases. Even new policies can include future premium increases — the insurer can apply to state insurance regulators for rate increases if claims experience is worse than projected.
• Work with a specialist broker. A generalist agent who sells life insurance as a sideline typically doesn't know the nuances of LTC policy structure. An LTC specialist can compare the handful of remaining carriers.
• Coordination with FLTCIP. If FLTCIP reopens in late 2026 and you've already bought private coverage, you could end up with overlapping policies. Many federal employees in that situation choose to let the more expensive private policy lapse and convert to FLTCIP's group rates.

Option 3: Hybrid Life / LTC Policies

A hybrid policy combines permanent life insurance (whole life or universal life) with an LTC rider. If you need long-term care, the policy pays out its LTC benefit. If you die without needing LTC — or without exhausting the benefit — your heirs receive a death benefit. You don't "lose" the premium if you never use LTC, which is the main objection to standalone LTC insurance.

How it typically works:

• You pay a single premium or a 10-year level premium to establish the policy
• The policy builds cash value and maintains a death benefit
• If you need LTC, monthly benefit draws down the death benefit (usually 2–4% per month)
• The LTC benefit pool is often 2–3× the initial premium

The TSP connection. A common strategy at federal retirement: roll a portion of traditional TSP to a traditional IRA, then use a portion of IRA funds to purchase a hybrid policy with a single premium. The IRA withdrawal is taxable, but you fund the policy with pre-tax dollars that might otherwise be fully taxable as RMDs later. If the hybrid policy's LTC benefit is used, those benefits are generally income-tax-free.

This approach is more complex than self-insurance and requires careful analysis of the policy's cost vs. the expected tax savings. A fee-only advisor can model both scenarios.

Option 4: Medicaid — Last Resort

Medicaid covers nursing home care for people who have spent down their countable assets below state eligibility thresholds. For most federal employees with FERS pension + TSP, Medicaid is not a realistic primary plan — but it's worth understanding its mechanics.

Key issues for federal employees:

• The FERS pension is countable income. Many states deny Medicaid when monthly income exceeds a threshold (often $2,742/month for an individual in 2026). A federal retiree with $3,000–$4,000/month in pension income may be income-ineligible even after spending down assets.
• TSP is a countable asset. Your TSP balance (or rollover IRA) counts toward the asset limit. You'd need to deplete it to approximately $2,000–$3,000 in most states to qualify.
• 5-year look-back. Medicaid has a 5-year look-back period — asset transfers made within 5 years of application can result in disqualification penalties.
• Spousal protections exist. The Community Spouse Resource Allowance protects a portion of the couple's assets for the spouse remaining at home (roughly $30,000–$154,140 depending on the state in 2026). The FERS pension of the spouse at home is also protected.

Medicaid planning for federal employees is complex and usually requires an elder law attorney. It is not a strategy to rely on without professional guidance.

Roth Conversions and LTC: A Hidden Connection

Most federal employees focus on Roth conversions as an RMD-reduction tool. But there's an underappreciated LTC angle: if you need to pay $120,000 in nursing home costs in a single year by drawing from traditional TSP, that withdrawal is ordinary taxable income. Stacked on top of your FERS pension and Social Security, it can push you well into a higher bracket and trigger IRMAA Medicare surcharges.

Roth TSP (and Roth IRA) withdrawals are tax-free when qualified. If you've converted a meaningful portion of your traditional TSP to Roth during the low-income window between early federal retirement and Social Security claim date — typically age 56–67 for federal retirees who leave before 62 — then any LTC costs you pay from Roth assets carry zero additional federal tax cost.

The math: $120,000 in nursing home costs drawn from traditional TSP at a 22% effective rate = $154,000 gross withdrawal needed to net $120,000 after tax. The same cost drawn from Roth = $120,000 exactly. Over a 3-year nursing home stay, the difference can exceed $100,000.

Use the TSP Roth conversion calculator to see how much of your traditional TSP to convert each year to build a tax-free LTC reserve.

For Current FLTCIP Enrollees: What to Review

If you enrolled in FLTCIP before December 2022, your coverage continues and premiums are still being collected. A few things worth reviewing:

• Your daily benefit amount. If you enrolled 10–20 years ago with a $150/day DBA, does that still cover realistic care costs? If you chose the 3% ACIO inflation protection, your benefit has been compounding — a $150/day benefit at 3% compound over 20 years is now $271/day. At today's nursing home costs of ~$375/day, you're still partially covered. If you didn't elect inflation protection, your original DBA may now cover far less than a day's care.
• Beneficiary and billing review. Log in at ltcfeds.gov to confirm your policy details and verify that premium payments are current. If you left federal service or retired, billing may have changed.
• Your elimination period. FLTCIP has a 90-day elimination period. That means you pay the first 90 days of care out of pocket before benefits begin. At $11,294/month, that's roughly $34,000 out of pocket. Have you budgeted for it?
• Coordination with Medicare. FLTCIP coordinates with Medicare. Medicare pays skilled care first; FLTCIP kicks in for custodial care that Medicare doesn't cover. Understanding which is primary for which type of claim matters when care starts.

When FLTCIP Enrollment Reopens: What to Expect

The suspension expires December 19, 2026 — assuming OPM doesn't extend again. If enrollment reopens:

• Federal employees who missed the 2022 enrollment window will have a new opportunity, likely during an open enrollment period announced by OPM
• Expect medical underwriting — a health questionnaire and potentially a phone interview; coverage is not guaranteed
• Premiums for FLTCIP 4.0 (or whatever the next product iteration is) will likely be higher than FLTCIP 3.0 given rising LTC costs
• The 3% ACIO inflation option may be modified or replaced with a CPI-linked option given how LTC costs are outpacing 3%
• Spouses of federal employees should consider enrolling simultaneously — they're eligible even if they have no federal service connection, and they face the same LTC cost exposure

If you're in your mid-50s and haven't enrolled, the window when you reopen at the best health-and-age combination for underwriting is narrowing. Be ready to apply promptly when OPM announces the next enrollment period.

Key Takeaways for Federal Employees

• FLTCIP is suspended through at least December 19, 2026. No new enrollments, no coverage increases for existing enrollees.
• Medicare and FEHB do not cover custodial LTC. The gap is real and potentially $100K–$400K+ per event.
• Federal employees have a structural LTC advantage. If your FERS pension + Social Security covers living expenses, your TSP can remain as a reserve rather than being drawn down for daily costs — making self-insurance more viable than for private-sector workers.
• The Roth conversion window matters. Converting traditional TSP to Roth during low-income years builds a tax-free LTC reserve that avoids large taxable distributions when care is needed.
• Monitor OPM announcements in late 2026. If FLTCIP reopens, apply quickly in the first enrollment period — underwriting becomes harder with age and health changes.

Sources

1. Administration for Community Living (ACL.gov): How Much Care Will You Need? — "70% of people turning 65 today will need some form of long-term care during their lifetime." Verified 2026.
2. NARFE: FLTCIP Application Suspension Extended Into December 2026 — OPM extended FLTCIP suspension for 24 months effective December 19, 2024, through December 19, 2026.
3. Federal News Network: Suspension on long-term care insurance enrollments will last until at least 2026 — John Hancock was the only bidder in OPM's most recent contract solicitation.
4. A Place for Mom: 2026 Costs of Long-Term Care and Senior Living — 2026 median care costs; nursing home cost increases 4.6%, home care 7.9% YoY per BLS data.
5. LTCFEDS.gov: Frequently Asked Questions — FLTCIP 3.0 plan structure: daily benefit amounts, benefit periods, elimination period, ACIO and FPO inflation options.
6. OPM.gov: Federal Long Term Care Insurance Program — Official OPM page on FLTCIP program information, eligibility, and suspension status.

LTC cost data verified against 2026 sources: A Place for Mom (May 2026), CareScout Cost of Care report, U.S. Bureau of Labor Statistics. FLTCIP status verified via NARFE (November 2024 OPM announcement) and OPM.gov. FLTCIP program details verified via ltcfeds.gov FAQs.