Interesting to see the rate you'll have under PERS. Did they have a lifetime option? I would be curious to find out what the premiums would be with that type of product.
Incredible increase in LTC policy premium
- Thread starter ejman
- Start date
I think at the time we signed up back in 1998 CALPERS also offered a home care option for more money. For whatever convoluted reason that made sense at the time we decided not to include it in the policy. Probably something along the lines of "we can take care of each other at home" or some such nonsense . Ah the foolishness of youth
A Must Read Especially the comments
The link below is an article written a couple of days ago on LTC insurance. The author, Mr. Baldwin speaks of the ills of LTC insurance and longevity insurance. However, it is the two comments of a Mr. Scott Olsen, the very eloquently refutes the claims in the article. He discusses CalPers and how those who are receiving those hikes could have been protected. For those of you who are considering LTC and those who don't believe in it, this is a good read, but especially read the comments.
http://www.forbes.com/sites/baldwin/2013/03/29/dodge-the-long-term-care-insurance-mess/
The link below is an article written a couple of days ago on LTC insurance. The author, Mr. Baldwin speaks of the ills of LTC insurance and longevity insurance. However, it is the two comments of a Mr. Scott Olsen, the very eloquently refutes the claims in the article. He discusses CalPers and how those who are receiving those hikes could have been protected. For those of you who are considering LTC and those who don't believe in it, this is a good read, but especially read the comments.
http://www.forbes.com/sites/baldwin/2013/03/29/dodge-the-long-term-care-insurance-mess/
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From what I can see, they've never had a lifetime plan, just dollar limit plans. While the plans work out to just over 4 years for nursing care, they do cover assisted living and home health care at reduced amounts so they'll last about 5.5 years and 6.5 year respectively.
timo2
Thinks s/he gets paid by the post
My DW just received a notice from CNA that her LTC policy was going up 22%. Actually, I was starting to worry about her plan because the premiums had not gone up like every other LTC policy in the country. Since CNA no longer sells individual LTC policies, I was concerned that the lack of activity meant some bad form of neglect. She has a lifetime plan, and still wants to keep that feature until she retires in 3 yrs, as LTC plans are for more than just the last few years of life.
Gearhead Jim
Full time employment: Posting here.
DW and I both purchased LTC policies from State Farm about 10 years ago (age 55/57). 5 yrs, inflation rider, total "value" of each policy is now about $580k. The premiums were shockingly low, about $100/mo per person. We just got about a 45% premium increase for both policies, our agent claims that SF is hoping to do a big one-time increase rather than several small increases over the years. We'll see...
martyp
Thinks s/he gets paid by the post
The new CalPERS rates are out. I will have to start doing the calculations to justify to myself why I continue to keep paying this.
ziggy29
Moderator Emeritus
The problems with LTCI are, in some way, another example of how the middle class is really getting hit from so many different directions. The very wealthy do not need LTCI. The poor have Medicaid. The middle class have a choice between an LTC policy that is increasingly unaffordable and can have the contract changed with huge rate increases... or risk losing everything before going on Medicaid themselves.
thats exactly the problem. my wife and i made the choice to buy 4 yr policys from GE(nworth) 10 years ago. we are in this catagory-i hope we never have to use them.
mickeyd
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
If I were a SF agent I'd probably say the same thing. Using the word "hoping" indicates that he is also hoping that he will not be a SF agent the next time that they announce a premium increase.
Finally got the CALPERS letters with the detailed proposals of rate/coverage changes. There are 6 options altogether and I'm having a very difficult time figuring out best way to proceed.
Option 1 (current coverage) - $162 Daily benefit, inflation protection, lifetime benefit period. Current cost $1,908 for the 2 of us increasing to $3,706 by 2015
Option 2 same as above but limit coverage to 6 year benefit. Current cost $1,517 increasing to $2,806 by 2015
Option 3 same as above but limit coverage to 3 years current cost $1,087 increasing to $2,011 by 2015
Option 4 limit coverage to 10 years and drop inflation protection current cost $1,283 no increase for 2014, 2015
Option 5 limit coverage to 6 years and drop inflation protection current cost $936 no increase 2014, 2015
Option 6 limit coverage to 3 years and drop inflation protection current cost $729 no increase 2014, 2015
Options 4, 5, and 6 give the option of increasing coverage 3 years from now for an additional unknown premium increase. " the cost of these increases is determined by the amount of additional coverage offered, the current premium rates, and the age at the time of the offer"
I would very much appreciate input from the collective board's wisdom....
I'm leaning to options 4 or 5...
Of course, there is also option 7 drop the damn thing...
Option 1 (current coverage) - $162 Daily benefit, inflation protection, lifetime benefit period. Current cost $1,908 for the 2 of us increasing to $3,706 by 2015
Option 2 same as above but limit coverage to 6 year benefit. Current cost $1,517 increasing to $2,806 by 2015
Option 3 same as above but limit coverage to 3 years current cost $1,087 increasing to $2,011 by 2015
Option 4 limit coverage to 10 years and drop inflation protection current cost $1,283 no increase for 2014, 2015
Option 5 limit coverage to 6 years and drop inflation protection current cost $936 no increase 2014, 2015
Option 6 limit coverage to 3 years and drop inflation protection current cost $729 no increase 2014, 2015
Options 4, 5, and 6 give the option of increasing coverage 3 years from now for an additional unknown premium increase. " the cost of these increases is determined by the amount of additional coverage offered, the current premium rates, and the age at the time of the offer"
I would very much appreciate input from the collective board's wisdom....
I'm leaning to options 4 or 5...
Of course, there is also option 7 drop the damn thing...
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most nursing home stays are 3 years or less. my wife and i bought 4 yr policies 10 years ago.
since you asked for opinions-you have no perfect option-i would go with choice number 3. 3 yr
Brat
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Is the time you are insuring joint or each?
Each
Thanks. I know that from a statistical stand point most nursing home stays are relatively short. When I've run numbers using FIRECALC, it shows that we could handle a relatively short ( 1-3 years) nursing home stay and essentially self insure. What I worry about are the long drawn out scenarios (5 -10 years +) that would basically demolish the other person's living standard while depleting all the assets.
most medicaid plans have a ltc clause where they let you keep the amount saved you should consult california medicaid if your ltc plan meets the requierments
I and several others here are looking for the same thing you are: True insurance: a policy with a long exclusionary period so we can self-insure for awhile. It seems that no company sells LTCi that is of this type.
DW and I only need shared benefits for "first to need it" coverage starting after about 2-3 years. The second person if alone and needing LTC could make do with SS, pension, sale of assets, and proceeds from investments to pay the LTC bill.
I don't live in California (resident of Oregon) but basically want to stay away from the run thru assets/shift assets/hide assets and then rely on medicaid scenario if at all possible. I really want to rely on my own resources as much as I can and let the government help some one that truly needs the help and hope I'm never in a position where I am the one that needs the help. (fingers crossed)
Yes, exactly. I don't understand why the mechanics of LTCI are so different that true insurance is not offered by anyone. I guess it must really be different. I understand a government task force researched the issue when exploring the ins and outs of health care and reached the conclusion that LTCI could not be offered at a reasonable cost.
I would look at Option 2 or option 3. First, the chances of both of you needing lifetime coverage in a nursing home are slim. Yes, it's possible but highly improbable.
I am not sure how old you are, but if you are in your late mid to late 70's then I would tell you it would be okay to drop the inflation protection. Otherwise, keep the inflation protection. Also, I would check to see what the cost of care would be in Oregon to see if the $162/dat would go as far as you want it.
I gather you must have lived/worked in California at one time if you have Calpers. Someone mentioned how you could keep assets if you use a longterm care policy. Well, that is true depending on if you have a California partnership policy. That allows you to keep assets in the amount of what your LTCi policy paid if you have to go on Medicaid. So if your LTCi policy paid $300,000 in benefits for long term care, then if you still need LTC and must go onto Medicaid, then you can keep $300,000 in assets without trying to hide them or transfer them or any other sneaky kind of thing. However, if you don't have a partnership policy, this will not apply. Also, you need to see if it would apply in Oregon, because not all of the partnership programs reciprocate with one another. In other words, you may have that asset protection in California where you bought the policy, but that does not mean that Oregon has to honor that agreement.
I would look at these items and your total financial picture to make the call.
I am not sure how old you are, but if you are in your late mid to late 70's then I would tell you it would be okay to drop the inflation protection. Otherwise, keep the inflation protection. Also, I would check to see what the cost of care would be in Oregon to see if the $162/dat would go as far as you want it.
I gather you must have lived/worked in California at one time if you have Calpers. Someone mentioned how you could keep assets if you use a longterm care policy. Well, that is true depending on if you have a California partnership policy. That allows you to keep assets in the amount of what your LTCi policy paid if you have to go on Medicaid. So if your LTCi policy paid $300,000 in benefits for long term care, then if you still need LTC and must go onto Medicaid, then you can keep $300,000 in assets without trying to hide them or transfer them or any other sneaky kind of thing. However, if you don't have a partnership policy, this will not apply. Also, you need to see if it would apply in Oregon, because not all of the partnership programs reciprocate with one another. In other words, you may have that asset protection in California where you bought the policy, but that does not mean that Oregon has to honor that agreement.
I would look at these items and your total financial picture to make the call.
martyp
Thinks s/he gets paid by the post
I am leaning toward the option with a 6 yr cap and inflation coverage. However, the statistics about the average length of stay in long term care isn't entirely clear. About 40% of the people in long term care are in the 18-64 yr range which tells me that they are victims of accidents that require short stays that bring the overall average down. I've seen 10-12% and 20% for the number of people who stay in long term care for 5 yrs+. I assume this number is dominated by the elderly. What I would really like to see is the distribution for length of stay for just the elderly. This document talks about these scenarios somewhat:
Who Needs and Who Uses Long-Term Care? | The SCAN Foundation
This site may also be useful to compare the CalPERS benefits to the actual cost of long term care in your area. My benefit amount is $222/day but the cost in my area is $259/day:
https://www.genworth.com/corporate/about-genworth/industry-expertise/cost-of-care.html
Who Needs and Who Uses Long-Term Care? | The SCAN Foundation
This site may also be useful to compare the CalPERS benefits to the actual cost of long term care in your area. My benefit amount is $222/day but the cost in my area is $259/day:
https://www.genworth.com/corporate/about-genworth/industry-expertise/cost-of-care.html
you don't HAVE to apply to medicaid-but if you have to do having a ltc policy thats acceptable to them will let you shelter more money. it's not ideal but it lets you buy a ltc policy thats's affordable. look at it from medicaids point of view. they know that most nursing home stays are 3 years or less.
Fair enough. I guess from a statistical standpoint I should just drop the coverage. I think we could afford a 3 year nursing home stay from our existing pot i.e. self insure. Maybe I should just stop pushing this rock a la sisyphus.
no because medicaid lets you KEEP the amount of the policy. say you have a policy that is worth 200,000 in todays dollars-medicaid will let you keep that amount of money, as long as it was a medicaid approved long term care policy. you should google this and investigate
read this
http://www.aaltci.org/long-term-car...ong-term-care-insurance-partnership-plans.php
OK, I just completed the online app. I'm relying on you. I hope I am not spammed or otherwise hounded to infinity and beyond!
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