China is experiencing an accelerated and large-scale aging process, with the proportion of people aged 60 and above reaching 18.7% and those aged 65 and above 13.5% in 2020, accompanied by a persistently low total fertility rate (1.3) and the first negative population growth since 1962. To address the growing long-term care (LTC) needs of disabled elderly people (approximately 44 million by 2022), China launched the social Long-Term Care Insurance (LTCI) pilot program in 15 cities in 2016, expanded to 29 cities in 2020, and covered 49 cities and 170 million people by the end of 2023. The LTCI system, a key component of China’s social security framework, primarily finances through transfers from basic medical insurance funds, government subsidies, and employer/individual contributions, with financing methods including quota-based, proportion-based, and mixed systems. Pilot practices (e.g., Qingdao, a pioneer since 2012) have demonstrated positive effects: reducing the economic and care burden of families, optimizing medical resource allocation, and promoting the LTC industry and employment. However, challenges remain, including unsustainable financing sources, mismatches between LTC supply and demand, shortages of professional institutions and caregivers, limited coverage scope, and inadequate assessment and regulatory standards. To advance nationwide popularization, China plans a phased path: early exploration (2012–2016), initial pilot (2016–2020), pilot expansion (2020–), and national promotion. Policy recommendations include establishing multi-channel sustainable financing mechanisms, expanding coverage to rural and vulnerable groups, developing unified disability assessment standards, standardizing benefit payments, fostering professional LTC institutions and talent, and strengthening regulation to mitigate moral hazard and fund risks. China’s LTCI experience provides valuable insights for developing countries tackling aging-related care challenges.