Long Term Care Insurance - Opinions Wanted
 

I wasn't sure if I should post this in the Non Villages Discussion or the Medical and Health Discussion.

I have been doing a little research on long term care insurance, and I will be going to a presentation in November about it.

Would appreciate any feedback regarding LTC. Worth it or not? I haven't heard what the monthly rate is, I believe it varies on what kind of coverage one chooses to purchase.

I'm a little reluctant to shell out money for insurance I may never use. If I drop dead suddenly at age 78 and never need long term care, what happens to the money I shelled out for 21 years to pay the premiums? I think this money could be put to better use going into my current employer's 401K plan or into the rollover IRA I opened 2 year ago with the money from my former employer's 401K and pension plans.

my mother used hers for the last three years of her life. each year the bills approached six figures and the ltc payout really helped. i have ltc and so does my sis so we won't become a burden on each other because let me tell you -- there are some really awful assisted living facilities out there and the good ones aren't cheap.

do your due diligence and pay a financial specialist to analyze your own particular situation. i'm sure you can google the subject for more perspective, too.

My husband has it. I do not. I have heard that if your financial assets are very low or very high, you may have Medicaid available when your assets reach less than $2,000 or to use your own assets to pay for the care, (estimated that you would need a minimum of $2,000,000). You may get some similar information from the seminar you will be attending.

That said, there are very few insurance companies offering LTC. Some who use to offer it are no longer accepting new policies. Without new policies, the insurers projected expenses are increasing. When insurers are able to prove that they can't meet their obligations at current premium rates, they petition the states for increases in premiums or decreases in benefits (at the same premium level). That is what is happening with my husband's LTC insurer. He has elected to lower his benefit to keep his premium level.

Buying LTC insurance will only be as good as the insurer you choose...if they are still solvent, in business, and probably, still in the business of selling new LTC insurance. That is the 20 to 30 year gamble for many of us. After the seminar, please share your thoughts on TOTV.

The 3 posts above seem to be referring to the "use it or loose it" type of Long Term Care Insurance (LTCI) coverage. Many of our parents have had this. Some of us do, too. You pay premiums monthly or annually. When the insured dies, all benefits end.

There is another option called Long Term Care Annuity (LTCA). You pay an initial premium up front. There are no ongoing premiums.

Most LTCI policies do not offer a cash withdrawal benefit, or benefits in the event that you don't require long term care during your lifetime. A LTCA may allow access cash value during your lifetime, even if you never require care. And, when the annuity contract matures, your contract's remaining cash value may be passed onto your beneficiaries.

The LTCA polices are not "perfect." As with a traditional annuity, there are fees. Some might even say "hidden fees."

I'm not advocating one or the other, simply pointing out some of the choices available.

In my opinion, long term care insurance is a waste of money. If you go broke, Medicaid will kick in. In fact, about 90 percent of the people living in nursing homes are on Medicaid. If the long term care insurance prevents you from going broke, it will benefit your heirs, not you. So, if your heirs want your money, then let them pay for your long term care insurance premiums. Also, annuities of any kind are a ripoff. They only benefit the people who sell them. The upfront sales commission on a typical annuity is about 10 percent.

Interesting replies...thank you to all.

My grandparents on my dad's side spent their last years in a nursing home in the mid-1980's. Grandpa spent 18 months in the nursing home, Grandma spent about 3 years. The combination of their nursing home expenses took almost all of the money they made by selling the family farm. My dad told me shortly after my grandmother passed away that if my grandmother had lived another 6 months, all of the money would have been gone, and she would have gone on Medicaid.

If you don’t mind your premiums going up every year, by all means, go for it.

Rollie

65 % of nursing home residents are Medicaid recipients. It would be wise to check out non Medicaid and Medicaid facilities to see if there is a difference in the quality of care and conditions of each. LTCI might look good to you afterwards.

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If you are single and the premiums would be a hardship, then it might not be worthwhile. If you ever need the services, you pay from your assets until they are exhausted then Medicaid kicks in.

For a couple LTC would make sense to preserve assets for the surviving/other spouse.

My employer offered LTC when I was in my late 40s...$100/month, inflation protection, and your premiums won’t go up...til they did 5 years later. I have chosen the self insured route.


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LTC Insurance
 

We have had LTC insurance thru Mutual of Omaha for about 8 years. Our premiums have never gone up, but the amount of coverage we have has increased each year by 5%. Our policies also coordinate so if one of us needs the coverage but the other does not, that person can use the coverage of the other one as well as their own. Our financial adviser, who we started using after getting the LTC, thinks it's a great plan. He has no affiliation with Mutual of Omaha. Everyone's needs are different but we are very pleased with this plan. And it gives us peace of mind if nothing else. Almost every form of insurance is a waste of money if you don't have a claim. The question is are you solvent enough to afford long term care assistance on your own. Whether or not you will need it cannot be accurately predicted. PM me and I can share more details if you would like.

B.

It rally depends on your SWAN requirements (Sleep Well at Night). You have medical insurance you hope covers you adequately. Same with Car insurance and Homeowners. I don;t know of anyone who makes sure they get their moneys worth using any of them. Some people have pensions, and along with social security use that as their "bond allocation" to protect against stock market variability. Others like annuities (I DO NOT). According to experts, there is a high likelihood that you will need Long Term Care somewhere during your lifetime. As an example, my dad had a stroke at 78, which left him unable to care for himself. He never went back home. He lived for 6 years in a very nice Assisted Living facility, and the last six months of his life in a Skilled Nursing Facility. I managed the money as tightly as I could, and picked up some little known veterans benefits for him at a crucial time. He had no idea about the money situation, but for the grace of God he passed at about the same time as the money was about to run out. he was a lifelong blue collar worker on the railroad, and managed to squirrel away enough money to take care of himself.

others aren't so lucky. While my wife and I are in much better shape than he was financially, medical costs and assisted living costs have skyrocketed. Often, in the case of couples, the first to need it puts an undue burden on the other. several years ago, when LTC was just coming out, we were both offered really good plans and really good rates way before we hit the "recommended" age of 60 for such insurance. We jumped at the chance, and have never missed the money from the premiums. We hope we never have to use it.. but, as part of our overall financial picture, we are able to Sleep Very Well at night ..

I don't live in The Villages - my Mom does, hence my membership on this site. That said, my wife and I (both 62) took out LTC from Mass Mutual through a broker here in NY this year. It ain't cheap, but NYS, oddly enough, gives you a 20% tax CREDIT on LTC premiums paid. Between the two of us, it comes out to about $7500 / year, but we each have a $220K pool of funds, and a third shared $220K pool that either of us can draw from if needed. It has built-in 3% inflation increases. And we get back $1500 at tax time from the credit. Wish other states would do the same, as we won't be staying in NY long after retirement age. Mass Mutual seemed to have the best bang for the buck with that 3rd pool of $$$ that others (like Mutual of Omaha) didn't offer.

To each his own, but that is a lot of money for something you may never use.

I believe I did a lengthy reply to a similar question on TOTV. I will try to find it and repost my thoughts...I was an Assisted Living Administrator and I do have a business sponsorship on TOTV under another name where I do support for seniors.

Long Term Care is not just for nursing homes. If you find you are in need of care which requires a few of the activities of daily living-eating (need meals), bathing, dressing, mobility-you may need assisted living and not nursing care. Or you may need a memory care community within an Assisted Living.

Assisted living is very expensive. I am a former Assisted Living Administrator. If you want a nice Assisted Living after having had a nice home and lifestyle, and depending on how much help with your daily living needs you have, you can be looking anywhere from mid $4,000 on up into the $6-$10,000 range.

A good long term care policy will cover in today's rates at least $6,000 a month with annual increases in the amount of coverage. You can usually expect 3-5% increase a year in Assisted Living.

And check to see if the policy will allow you to use the benefit to have in home help instead of moving out if that would suit your situation. Often you can hire your own person, even a relative, to provide care.

And please remember, if you are a veteran and need assisted living or nursing home, apply for the Aide and Attendant Benefit, but you have to have lower assets to be eligible.

Planning how you manage your assets early on can help you obtain Medicaid and Aide and Attendant when you need it.

Many assisted livings do a very high level of care which will keep you out of a nursing home unless you develop certain medical needs that the State regulations do not allow them to provide. Always ask what is the highest level of care they provide, including a memory care area within the assisted living. And please look beyond the beauty of the building and the chandelier. Ask how long the Administrator has been there; ask to see the State survey results of the past few years and also to see any investigation complaints and outcomes (also on the ACHA website); talk to residents and family members; ask the percentage of staff turnover; and eat quite a few meals there on different days including Sundays. You would be surprised to know that with all the money you pay, the food budget daily for a resident can be from under $5 to $7 a day. They hound the Administrator to keep the food budget low and to push the chef to be frugal.

Ask about transportation-how often, to where, how far will they drive you. And entertainment-how often are entertainers brought in, will they take people out to other events and outings.

How many nursing hours a day? And is it 7 days a week?

Be vigilant in choosing an assisted living. There are many in The Villages and there are some very nice ones on the outskirts. Do not be manipulated when they tell you at the ones in The Villages that you can access all the benefits of The Villages. Very few people in Assisted Living use Villages amenities, sometimes the healthier spouse living there may, but don't take it as a selling point, and they will try and sell and market to you. Take a look at those in and outside the parameters of The Villages.

And, do not think you cannot negotiate. There is always a "move in" fee. You can negotiate this down and often get rid of it all together if they need to get their occupancy numbers up. Assisted Living is all about occupancy. There are investors to satisfy as well as the management company who is pressured by the investors and owners. They need you more than you need them because there are so many to choose from. Sometimes there are incentives like a month or two free rent, so never move in without an incentive and a deal.

Hope this helps-I know you were asking about Long Term Care insurance but it is good to understand how you can spend it, where and what you get!
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Another thread

https://www.talkofthevillages.com/fo...long+term+care

Long term care or any insurance is a bet
 

Just be aware that any,"presentation," is someone or some company trying to SELL something.

Listen, learn AND SIGN NOTHING. Any presentation where you must act now. Don't walk now-RUN.

I recall reading that the average stay in long term care is SIX MONTHS. What is SIX MONTH insurance worth?

You may want to read the Oct 2017 Consumer Reports article.

I don't subscribe to LTC premiums being a lot of money for something that may never be used.
Like home owners insurance?
Car insurance?
Rx insurance?
To name a few almost all of us have.

I personally do not accept the default of going broke and having medicaid is an acceptable alternative.

Like the other insurances in our lives....all just in case...I prefer to add LTC to my list. To me I want some control over the type and quality of where I will be treated/housed.

If I never have to use it it will be a plus. Like all the automobile premiums paid year in and year out for 60 years and happy to not have had to make a claim.

I have LTC for the wife and I. We have been fortunate these many years to not have to use it!!

Like so many things as we age, it is all about personal choices, finances, peace of mind (and affordability).

Sound advice. A financial advisor will tell you that LTC is an essential part of your financial picture even if he or she does not offer it.

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OP, talk to your financial advisor, you may have options that you are not aware of. I am not interested in posting specific personal info on this site, but if you are interested, send me a PM.

Something to consider...several years ago while looking for assisted living for a relative in another state, several of the nicer facilities that did not accept medicaid told us right up front that they did not accept LTC either! This was not an issue since that option was not on the table anyway so we didn't pursue their reasoning for it but it is something to consider before purchasing LTC. Perhaps talk to some of the facilities in the area and ask them if they accept it or not.

The facility doesn't have to accept it. You pay the bill, then file a claim with the insurance company. Generally the policy will have guidelines about what types of care the facility provides, licensing, etc.

I've posted before......................

There are a lot of studies out there................If you have less than $250k in assets, don't buy. And if you have over $1.5mil, don't buy. But if you are in the middle, should consider.

Okay, Open Season............take shots.

:boom::boom:

Well, that's the nature of any kind of insurance, right? And last I checked, no one can really predict the future (well, except the end game, lol).


So yeah, to each, his own.

Right, but I have never paid anywhere near $7500 per year for any insurance. I'd rather go on a cruise and take my chances with long term care.

The $7500 per year would indicate you waited far too long to think about getting it.

Actually, no, lol. Got it at 61. And that's coverage for two people, not one. The wife's had a few health issues that made her rate somewhat more expensive than mine.

But like anything, it's what you want and the options you choose that determines the cost.

We've got over $650K in shared pool benefits available, no elimination period for benefits, 3% annual compound inflation protection - so that current $650K pool keeps compounding each year.

I've already mentioned we get a NYS 20% tax credit (not deduction), so now we're down to $6000 net for two people. My company throws in $1000 in my HSA every year - which can be used for LTC premiums - so now we're down to $5000 net for two people.

Trust me - I've done my homework. And I'm not trying to convince anyone else to do it. Personally, I don't want to put my retirement nest egg at risk were something to happen to either me or my wife that would require some expensive LTC. But, that's just me. Everyone can - and should - decide what's best for them. There's no right or wrong.

I read through all the replies. Some are accurate but some not. I'm new to the Villages and didn't expect to see the constant barrage of info about anything financial, but I guess I understand it. There are a ton of retirees down here and everyone wants to sell something. I do have some professional points that folks can take or leave;
Traditional LTC insurance is generally the use it or lose it variety. As people live longer and the costs get higher to care for someone, particularly if they have cognitive issues that can go on for years, the insurance companies pay out more and more in claims, so the premiums will only get higher. Premium pays for protection of assets. I've seen nest eggs and retirement accounts decimated because of the costs of not only facility care, but in-home care of a spouse.
It's true that if you dont use it, you dont get anything back, and premiums will go up but, like it or not, how to pay for medical care like this is a huge financial risk for retirees, and most don't want to be a financial burden to their kids. People who buy LTC insurance are playing the odds, but statistics do show that chances are good one or both spouses will need some form of care when they get older.
To those who say "oh, I'll just rely on Medicare or Medicaid to take care of things.": Have a better plan, because that one sucks. The more Medicare, Medicaid, and government is involved, the less choice you will have in what happens. Medicare stops paying after 90 days. Medicaid is the door to crappy facilities, restricted options for care, and spend-down scenarios with longer and longer lookback periods. These things are not what someone wants to deal with when they have to make hard decisions about the care of a loved one.
Because of the down sides of LTC insurance, companies do offer other options for those who want some protection against having to come up with $6 or 8,000 a month to take care of their spouse. I've seen some hybrid products introduced that are sometimes a better option. Some are life-insurance based, others are annuity-based. If you have a decent financial planner, he or she should have let you know about these. I've seen annuity products that double or triple a one-time investment if the funds are used for LTC needs. That one requires good health but the person gets it back if they don't use it. For those who say that annuities are always bad; I disagree. They are very effective when used for the right purpose for the right person, and, like anything else, are just a piece of a good plan. The point is, investigate what is out there. There are actually some great solutions if huge long term care expenses might be in your future.

LTC insurance is reimbursement. Not an acceptance issue.

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Yes reimbursement AFTER you have been accepted to start receiving it. You need to have some of daily living needs, 2 to 3, to be able to use the insurance you pay for. So if you are independent and moving into assisted living, you cannot use it. But if you have a few needs of daily living, such as mobility, eating, dressing, bathing/bathroom, or if you have memory care, then you should be accepted to use it. Read your policy carefully and also try to get one that allows you to bring help into the home in case you prefer that option.

This was a must have in our final selection.

I'm the original poster who started this thread a few weeks ago. I'm now waiting for my LTC application to be completed by Mutual of Omaha. The nurse's health screen/memory interview conducted last week was quite interesting.

With LTC health issues don't necessarily preclude denial. It isn't like life insurance where they want longevity. Per my agent.

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One thing about LTC insurance that has always bothered me is what do you do if the insurance company denies your claim because they say you are not sick enough? How can you trust the company to pay up when you need it?

Necessary qualifications will be spelled out in the policy. Usually based on ADL's (Activities of Daily Living). If certified by a licensed health care practitioner that you are unable to perform a specified number of ADLs without assistance (dressing, eating, bathing, etc.), and you receive that assistance in accordance with your policy, they pay.

ADL per Investopedia:

Activities of daily living (ADL) are routine activities that people tend do every day without needing assistance. There are six basic ADLs: eating, bathing, dressing, toileting, transferring (walking) and continence.

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Mother lasted 3 mos in nursing home, father none, mother in law 1 month, father in law 2 months. Somewhere I read that the average stay in a nursing home is 3 months when you factor in those who never spend any time in one. Long term care insurance just doesn't seem like a good bet. Better off loading up your 401K. My experience with nursing homes is that one's in smaller towns are both nicer and cheaper.

This policy also covers "at home" care -- say I would need to hire someone to help me at home x number of hours a day or a week if I need help with the activities of daily living mentioned in earlier posts.

Medicare covers if you need at home care, also covers
nursing home for 90 days. After that I will call Dr Kavorkian, I don't want to vegatate in a nursing home.