"There are several reasons," says Dr. Walden, a professor of agricultural and resource economics. "First of all, a simple reason is that the majority of older people end up not needing long-term care. About two-thirds of older folks will never go into a nursing home, so with those kind of odds many people say, 'Gee, I'm not going to need that kind of care, so I'm not going to buy the insurance.'

"The second reason is there are private substitutes. The most common is that your family will take care of you if you need long-term care. And indeed that is the case in many situations; a person gets in effect unpaid care from their children or perhaps through a church group," he adds.

"And then thirdly there is government help. Under certain restrictions, Medicaid will pay part of the cost of a nursing home. And even though that's not lavish, many people again their mindset would be, 'Well, gee, if I do need a nursing home, the government's going to pick up the bill.' And they view Medicaid as a backstop. In effect they view Medicaid as a substitute for their own long-term care that they may have paid for out of their pocket.

"So for these three reasons economists think that long-term care insurance really hasn't taken off," he concludes. "And so these three reasons would have to be addressed if we want to see more folks buy long-term care insurance."