Should you buy inflation protection for long-term care insurance? Absolutely. In fact, if you don’t think you can afford that extra coverage, you should probably rethink whether you should buy the insurance at all.

The issue of inflation protection was just one of the subjects that I, along with financial adviser Michael Kitces and insurance industry spokesman Jesse Slome, discussed on a Wall Street Journal webcast on Monday. The Journal’s Anne Tergesen wrote a nice article this week that also touched on the inflation issue.

There is a reasonable debate about how much additional coverage you should buy, but there is no doubt that nearly everyone should buy some. Here are just some reasons why:

Typically, buyers of long-term care insurance are in their 50s or early 60s. But you probably won’t need substantial help with daily living until you are in your 80s. That means the cost of long-term services and supports—whether you receive care at home, in a nursing home, or in some other setting–will rise year after year for thirty years before you ever collect benefits.

As a result, what looks like a pretty good benefit today will be worth far less when you eventually make a claim.

How much less? Say you buy a three year policy that promises to pay $150-a-day (a bit more generous than a typical policy). Today, according to the latest survey of long-term care costs by ltc insurer Genworth, a private room in a nursing home averages $240-a-day, or nearly $88,000-a-year. Your $150-a-day policy would cover 58 percent of the cost and you’ll pick up the additional $90 out of savings or retirement income.

That might be manageable. But if inflation averages 3 percent a year (the long-term average for the overall economy), in 30 years the purchasing power of that $150 will shrink to less than $62. Or to put it another way, that $240 daily cost of a nursing home bed would increase to $582. However you prefer to think about it, your insurance would cover only about one-quarter of your daily costs instead of nearly 60 percent.

It is true that inflation will also increase the size of your nest egg (in nominal dollars), but will you have the resources to pick up the difference?

Of course, there is no way to predict increases in long-term care costs over the next 30 years. The Genworth study and others like it provide some useful information but also can be misleading.

Here’s one problem: Genworth reports that the median cost for that private nursing home room increased by an annual average of 4.19 percent over the past five years. But that was a period when we were slowly climbing out of the worst recession since the 1920s and many measures of inflation, including labor costs, remained stagnant. Thus, I’d be very careful about using the last five years to predict the next 30.

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In recent months, major insurers have adopted “gender distinct” rates for new coverage. Translation: If you’re a woman, you’ll now pay more than a man for the same coverage.

Rates for single women rose 20 to 40% last year, while rates for single men fell 15%, says Jesse Slome, executive director of the American Association for Long-Term Care Insurance (AALTCI) in Westlake Village, Calif. For couples, who pay blended rates, premiums rose 3%.

Here’s an example: If you’re a 55-year-old woman in good health, you’ll pay an average of $1,225 a year for a new policy providing $164,000 in benefits, without any built-in inflation protection. A man of the same age and health with the same coverage would pay $300-a-year less, according to the AALTCI 2014 Long-Term Care Insurance Price Index.

The difference in premiums is even greater if you buy a policy whose benefits grow with inflation, which many experts recommend. A 55-year-old healthy man would pay $1,765 a year for that same policy with 3% inflation protection, but a woman might pay over $2,300 annually.

Why are women now paying more than men for long-term care policies? Longevity.

Women typically live five to seven years longer than men, which means they’d need benefits for more years. “So, it makes sense that they would pay more than a man,” says Slome. “Prices for insurance are based on risk, which is why men pay more than women for life insurance and bad drivers pay more than good drivers for car insurance,” he says.

A Fight to Overturn New Pricing

But women are pushing back.

Last month, The National Women’s Law Center (NWLC) filed complaints with the U.S. Health and Human Services Department’s Office for Civil Rights against leading long-term care insurer Genworth Financial and three others — John Hancock, Transamerica and Mutual of Omaha. The group maintains that gender-based premiums violate a provision of the Affordable Care Act that bans sex discrimination in health care.

“Women already have a hard enough time making ends meet, earning only 77 cents for every dollar earned by men,” says NWLC Vice-President and General Counsel Emily Martin. “With lower wages to begin with, women simply can’t afford to pay 20 to 40% more than men for the same long-term care insurance.”

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