My parents have a 5-year benefit period on their long-term care insurance plan. Does that mean they must use all the money within that time?

Call the long-term care insurance company that produced the policy and ask them this question and they will explain how the coverage works.

If their policy is like my Mom's (or any other policy I've seen), yes, the policy covers a dollar amount equal to the annual coverage times five years, which can be stretched out over their lifetime or until the total coverage amount is paid out, whichever comes first.

You can confirm this by reading the policy "evidence of coverage" and finding the total coverage amount. There will likely be a list of definitions that spells out how the total coverage amount is adjusted for inflation and how it is reduced for claims paid. Mine also has a page for each category of benefit that spells out "When will benefits end?" and states

"This benefit will be paid as long as:
 the Conditions for Receiving Benefits are met; and
 the Total Coverage Amount has not been reached.
(The Total Coverage Amount is shown in the Schedule of Benefits.)"

If they are not yet receiving benefits and have inflation protection, they should receive an annual "schedule of benefits" listing the updated total coverage amount and the maximum for daily or monthly coverage.

If they are on claim, the "explanation of benefits" should have a summary showing the payment for the current period, the total amount of plan payments, and the lifetime coverage remaining.

These documents should be available through an online portal once an account has been set up.

The total benefit is calculated by the monthly benefit amount selected when the policy was bought multiplied by the number of months in the benefit period.

The amount of money can be thought of as a checking account.

You should call the insurance company customer service line and have them walk you through it.

Or post this question on www.bogleheads.org; there are a couple of LTCi experts there.

Here is a very thorough explanation:

https://www.ltcnews.com/resources/faq/what-is-a-benefit-period-on-a-ltc-insurance-policy

Good question! I hope somebody replies because I would like to know the answer too. Momma has a long term care policy and she has been in assisted living for almost five years. Also she does not use up all of her benefit money in a month. I was reading somewhere about a death benefit. That some of that money she did not use up every month she would or her estate would receive it after she is deceased but it might have something to do with what kind of policy you have. I have read mommas policy again but cannot find anything about this. I was thinking I could call them. I talk to them all the time.