LTC Increase

[Chuckanut]

I don't like this at all. Years ago I bought life insurance when I was healthy. The amount of the insurance and the premiums (while they went up) were guaranteed to never exceed a certain amount. That was the point of buying while healthy and young. Lock in a good rate. It seems that for LTC insurance that is not possible. Not so good.

 

[East Texas]

I don't like this at all. Years ago I bought life insurance when I was healthy. The amount of the insurance and the premiums (while they went up) were guaranteed to never exceed a certain amount. That was the point of buying while healthy and young. Lock in a good rate. It seems that for LTC insurance that is not possible. Not so good.

I think if you go back and read a LTC contract you'll find something similar to this statement: "Your rates cannot be increased due to your increasing age or declining health; but, your rates may go up based on the experience of all policyholders with a policy similar to yours."

Same thing with auto and homeowner insurance. It's the overall risk of the pool that influences rates.

 

[Brat]

I would like to waive a caution flag about the length of time men live in care facilities. Married men usually have younger wives who care for them for an extended time before their moving to a care facility. The three months, average, discussed in the statistics would not include that period of incapacity.

It is true that many men similarly care for their wives but more often they don't because they are frail and unable or they have passed.

My father was 9 years older than my mother and he felt it was her DUTY to care for him notwithstanding the fact that she had Parkinson's. The tried for a couple months and said, that is all I can do. She moved him to a care facility from which he fled on one occassion.

 

[Nords]

She moved him to a care facility from which he fled on one occassion.

My brother and I have had serious discussions about getting Dad a pair of GPS-equipped shoes or a GPS bracelet/necklace. So far, though, Dad feels much more comfortable within the facility than without.

 

[youbet]

If we wind up in Assisted Living, a nursing home, or a memory care facility.......

Does your policy cover "assisted living?"

I had a recent experience with an aunt who could no longer live alone. With no one to look out for her, she'd forget meds, leave the kettle on the stove until it was dry, ignore bills, etc. She had plenty of money so she moved, at the suggestion of and with the help of a neice, into a nice assisted living facility. There she ate meals in a dining room, had folks to clean her apartment, do laundry, take her to doc appointments and check on her multiple times per day. It seemed to work out well but was not covered by her long term care policy. When her niece investigated, she found out that had our aunt been penniless, Medicaid would not have paid for it either.

Can anyone comment? Where does the line between "nursing home" and "assisted living" get drawn and how do LTC policies fit into assisted living needs?

 

[MissMolly]

Does your policy cover "assisted living?"

I had a recent experience with an aunt who could no longer live alone. With no one to look out for her, she'd forget meds, leave the kettle on the stove until it was dry, ignore bills, etc. She had plenty of money so she moved, at the suggestion of and with the help of a neice, into a nice assisted living facility. There she ate meals in a dining room, had folks to clean her apartment, do laundry, take her to doc appointments and check on her multiple times per day. It seemed to work out well but was not covered by her long term care policy. When her niece investigated, she found out that had our aunt been penniless, Medicaid would not have paid for it either.

Can anyone comment? Where does the line between "nursing home" and "assisted living" get drawn and how do LTC policies fit into assisted living needs?

Long Term Care insurance kicks in when (usually) 2 of the 5 Activities of Daily Living (ADL) - getting in/out of bed, toileting, bathing, dressing, eating - require hands-on or standby assistance. It is not necessary to require skilled nursing care as one commonly receives in a nursing home. Assisted Living facilities are able to provide the assistance in the 5 ADLs.

 

[youbet]

Long Term Care insurance kicks in when (usually) 2 of the 5 Activities of Daily Living (ADL) - getting in/out of bed, toileting, bathing, dressing, eating - require hands-on or standby assistance. It is not necessary to require skilled nursing care as one commonly receives in a nursing home. Assisted Living facilities are able to provide the assistance in the 5 ADLs.

Thanks MissMolly. My aunt passed away so it's water under the bridge now, but I'll ask my cousin why she thinks the LTCI didn't kick in based on the 5 ADL's. Perhaps my aunt was not incapable of any of them but rather, at 88, just found it more convenient to live in a facility where meals were provided, cleaning and laundry were taken care of and other services, including maintaining contact with a primary physician for instructions, could be arranged.

It is an interesting question and I'll have to learn more about it. I thought that folks in assisted living facilities were generally not covered by their LTCI and folks in skilled nursing facilities were.

 

[East Texas]

Does your policy cover "assisted living?"

Yes. All that's required is not being able to do two of the five daily activities. My LTC covers me to stay home and receive home health care, go into a very nice Assisted Living Facility, a good nursing home, and then (if needed), a memory care facility.

 

[Independent]

Thanks MissMolly. My aunt passed away so it's water under the bridge now, but I'll ask my cousin why she thinks the LTCI didn't kick in based on the 5 ADL's. Perhaps my aunt was not incapable of any of them but rather, at 88, just found it more convenient to live in a facility where meals were provided, cleaning and laundry were taken care of and other services, including maintaining contact with a primary physician for instructions, could be arranged.

It is an interesting question and I'll have to learn more about it. I thought that folks in assisted living facilities were generally not covered by their LTCI and folks in skilled nursing facilities were.

The ADLs determine that you are disabled. But policies only pay if you are disabled AND using covered services. Most currently sold policies cover a wide range of services, and many have an "alternate plan of care" provision which obligates the insurer to at least consider care options not specifically listed in the policy.

But, in the early days of LTC insurance, the only option was skilled nursing facillity. Then they expanded by adding additional providers (often at a reduced daily maximum). It's possible that your aunt's policy didn't cover and ALF, but almost any policy that you'd buy today would.

 

[Independent]

We're self insuring, but it's not due to any problems with the general concept of LTC insurance.

The problem is the current policy design, which has a combination of non-guaranteed premiums and no non-forfeiture benefits. That puts the purchaser at the mercy of the insurer.

People figured out that this was a bad idea for level premium life insurance over 100 years ago. AFAIK, all states have required nonforfeiture for common life insurance policies. But none of them do the same thing for LTC insurance.

 

[Brat]

Actually they are different licences. Assisted living is just that, they do not provide nursing care. At most they have a person trained and licenced to dispense meds from a secure location. Assisted living facilities do not care for the bedridden although they typically will bring meals to a resident who is in bed recovering from the flu.

Nursing homes often have two levels of licensure, convalescent and skilled. Dementia/Alzheimer's care is a separate nursing home licence in my state.

The line gets fuzzy with dementia. Your aunt's condition was possibly symbiotic .. she got forgetful, couldn't look after herself and as a result became more confused. Often moving to assisted living reduces confusion because she is better nourished, takes her meds on time and socializes. Dementia to the point that a resident is disruptive can rarely be accommodated in an assisted living setting.

From a ltc standpoint benefits are typically dependent on the inabilities to perform listed activities of daily living. Contracts can vary. My mother's ancient contract required living in a licenced nursing facility, today's do not.

 

[ziggy29]

We're self insuring, but it's not due to any problems with the general concept of LTC insurance.

The problem is the current policy design, which has a combination of non-guaranteed premiums and no non-forfeiture benefits. That puts the purchaser at the mercy of the insurer.

Same here. If I felt like the premiums wouldn't increase in the future, I'd be much more willing to consider it. But I don't want to get into a situation where the insurer jacks up the premium beyond what I can afford, and have to dump the product with little or no accrued benefit for the premiums I've already paid.

 

[youbet]

Actually they are different licences. Assisted living is just that, they do not provide nursing care. At most they have a person trained and licenced to dispense meds from a secure location. Assisted living facilities do not care for the bedridden although they typically will bring meals to a resident who is in bed recovering from the flu.

Nursing homes often have two levels of licensure, convalescent and skilled. Dementia/Alzheimer's care is a separate nursing home licence in my state.

The line gets fuzzy with dementia. Your aunt's condition was possibly symbiotic .. she got forgetful, couldn't look after herself and as a result became more confused. Often moving to assisted living reduces confusion because she is better nourished, takes her meds on time and socializes. Dementia to the point that a resident is disruptive can rarely be accommodated in an assisted living setting.

From a ltc standpoint benefits are typically dependent on the inabilities to perform listed activities of daily living. Contracts can vary. My mother's ancient contract required living in a licenced nursing facility, today's do not.

Thanks Brat, and everyone, very informative.

Thinking back on my visits to my aunt, I doubt she was incapable of any of the five ADLs. But as a widow she was lonely and at 88 she seemed to lack motivation to "keep her act together" living alone. She was living in Florida in a lovely, gated community. My cousin visited and found the house cluttered and evidence that our aunt was not really taking care of herself.

The senior (I'm calling it "assisted living") facility she wound up in back here in Chicago was fairly swanky. She had a nice apartment plus lunch and dinner daily. She got a visit from an employee every morning who saw to it she was up and about, talked to her about her schedule for the day, etc. I'm sure if she missed lunch or dinner, someone would have checked on her. There were activities and transportation was available. She told me she liked it there which was all I wanted to hear.

But, I very much recall that her LTCI acquired through the MegaCorp she retired from did not pay. She was a retired MegaCorp executive with a significant pension and also collected her deceased husband's pension (at 100%), so the monthly fee from the facility was not an issue.

 

[Independent]

Virtually all LTC insurance policies issued today are "qualified" for federal tax purposes. This is from IRS pub 502 where they are listing the rules for qualified:

Chronically ill individual.

An individual is chronically ill if, within the previous 12 months, a licensed health care practitioner has certified that the individual meets either of the following descriptions.

He or she is unable to perform at least two activities of daily living without substantial assistance from another individual for at least 90 days, due to a loss of functional capacity. Activities of daily living are eating, toileting, transferring, bathing, dressing, and continence.

He or she requires substantial supervision to be protected from threats to health and safety due to severe cognitive impairment.

The second condition is included to expressly cover people who are physically able to perform the ADLs, but have a mental problems.