What is Considered LTC Self-insure Safe Level?

[Sunset]

I am single with assets that border on self insure and LTC. So I'm conflicted about continuing my coverage, which I've had for 6 years now. My premiums have jumped to $3600/year. While I have no need to leave an inheritance, I still feel some peace of mind knowing that I have excellent coverage for both in home care and nursing home. On the other hand, I don't like parting with $3600/year for insurance. On the third hand, the market is up so much the pain isn't terribly significant right now. Lots of conflict here!

I wonder if the insurance companies make most of their LTC money by people buying one, paying for x years then canceling.

My concern with LTC is they can raise the rates often, as you get older.

If you are close to using it, (old?) then I'd keep it, as you already paid $21,600 so far.

If you don't need to leave an inheritance (who needs to?), and you are single, who cares if you spend all your remaining $$$ on LTC, which would mean the insurance is a bit of a waste.
You still get the excellent care even if you go on medicaid.

 

[Dash man]

People get so focused on Long Term Care without considering the costs of assisted living or memory care that may be needed prior to a nursing home. I'd bet the number of people using those facilities are much higher than nursing homes, and while less expensive, they're not cheap and not covered by Medicaid or most LTC insurance.

 

[Dd852]

People get so focused on Long Term Care without considering the costs of assisted living or memory care that may be needed prior to a nursing home. I'd bet the number of people using those facilities are much higher than nursing homes, and while less expensive, they're not cheap and not covered by Medicaid or most LTC insurance.

Good point. My mother currently needs 24 hour care at home. Her LTC policy would only kick in if she were senile, which she isn’t. So it comes out of pocket. Thankfully she and my father were the original LBYM-Ers so she has funds. But it so easily could have been a different story.

 

[ncbill]

Wow, thanks this just went on my very short to do list. And now I know what palliative means I want extra .

For those of us in the USA, there's usually a state-specific "model form" for health care POA, but you can modify it.

But you have to pick someone who you trust to carry our your wishes.

One of the horror stories a few years back that made news was a wife demanding everything be done for her dying husband.

IIRC it turned out she had withheld from every medical provider the part of his health care declaration that said he didn't want heroic measures.

 

[braumeister]

For those of us in the USA, there's usually a state-specific "model form" for health care POA, but you can modify it.

But you have to pick someone who you trust to carry our your wishes.

One of the horror stories a few years back that made news was a wife demanding everything be done for her dying husband.

IIRC it turned out she had withheld from every medical provider the part of his health care declaration that said he didn't want heroic measures.

This is important. When my dad was terminal, he went into a hospital for some palliative treatment and I provided the hospital with a notarized copy of his advance directive that was very specific. He was more than ready to go, just wanted it to be peaceful.

The doc in charge of his case simply ignored it and began treatment that was totally against his wishes (feeding tube, radiation treatments, etc.) and my poor father had to put up with it and live another four months in a miserable state. I got no help from anyone at the hospital -- they just said "we don't pay any attention to those documents; we have our own standards."

That was in 1996 and I'm sure things are better now, but what a bad taste that left in my mouth.

 

[Blue Collar Guy]

For those of us in the USA, there's usually a state-specific "model form" for health care POA, but you can modify it.

But you have to pick someone who you trust to carry our your wishes.

One of the horror stories a few years back that made news was a wife demanding everything be done for her dying husband.

IIRC it turned out she had withheld from every medical provider the part of his health care declaration that said he didn't want heroic measures.

Ill look for an attorney that specializes in this area, and either comes to the house, or has very late hours. I also need a will, someone pointed this out to me before and I still didnt do it.

This is important. When my dad was terminal, he went into a hospital for some palliative treatment and I provided the hospital with a notarized copy of his advance directive that was very specific. He was more than ready to go, just wanted it to be peaceful.

The doc in charge of his case simply ignored it and began treatment that was totally against his wishes (feeding tube, radiation treatments, etc.) and my poor father had to put up with it and live another four months in a miserable state. I got no help from anyone at the hospital -- they just said "we don't pay any attention to those documents; we have our own standards."

That was in 1996 and I'm sure things are better now, but what a bad taste that left in my mouth.

I didnt know that this was even a possibility. I will ask the attorney about this scenario to try to avoid it.

 

[aja8888]

This is important. When my dad was terminal, he went into a hospital for some palliative treatment and I provided the hospital with a notarized copy of his advance directive that was very specific. He was more than ready to go, just wanted it to be peaceful.

The doc in charge of his case simply ignored it and began treatment that was totally against his wishes (feeding tube, radiation treatments, etc.) and my poor father had to put up with it and live another four months in a miserable state. I got no help from anyone at the hospital -- they just said "we don't pay any attention to those documents; we have our own standards."

That was in 1996 and I'm sure things are better now, but what a bad taste that left in my mouth.

When I took DW in for heart surgery last month, I was told the same thing when I handed them the advance directive. Something about the Dr makes the decision what to do if things don't work out (like waking up).

 

[MrLoco]

People get so focused on Long Term Care without considering the costs of assisted living or memory care that may be needed prior to a nursing home. I'd bet the number of people using those facilities are much higher than nursing homes, and while less expensive, they're not cheap and not covered by Medicaid or most LTC insurance.

Sorry... but this is incorrect information. Most LTC policies DO have a provision to cover care due to cognitive impairment. Many nursing homes now have a dedicated wing for alzheimer patients.

In order to qualify for benefits for nursing home care, one must demonstrate the inability to perform 2 out 6 of the ADL"S (activities of daily living). These include being unable to perform 2 out of 6 of : Bathing, Dressing, Eating, Toileting, Transferring, or Continence.

Cognitive Impairment is a separate provision in the policy. This was important to us as there is a history of dementia on my side of the family.

 

[Blue Collar Guy]

In order to qualify for benefits for nursing home care, one must demonstrate the inability to perform 2 out 6 of the ADL"S (activities of daily living). These include being unable to perform 2 out of 6 of : Dressing, or Continence.

.

On certain days I could qualify now.

 

[Teacher Terry]

I was the guardian for a friend of mine with Alzheimer's as her DH was dying. She paid her way for a year but when her needs went up so did the price. I applied for Medicaid and she got to stay there. Their $ was gone as she fought cancer for past 16 years many times and then he had a few bouts.

 

[ncbill]

When I took DW in for heart surgery last month, I was told the same thing when I handed them the advance directive. Something about the Dr makes the decision what to do if things don't work out (like waking up).

That waiver is part of the consent to surgery paperwork DW (or you) signed prior to surgery.

It is not a permanent waiver of her advanced health care directive.

 

[nwsteve]

That waiver is part of the consent to surgery paperwork DW (or you) signed prior to surgery.

It is not a permanent waiver of her advanced health care directive.

Please say more about this consent form. My DW had brain surgery twice and I do recall seeing any waver of healthcare directive--only a box to check if there was one. At one of the surgery, DW did have to tell the surgeon she had a directive on file at the hospital. He had no idea. Hospital incompetency or surgeon indifference?

 

[Scuba]

People get so focused on Long Term Care without considering the costs of assisted living or memory care that may be needed prior to a nursing home. I'd bet the number of people using those facilities are much higher than nursing homes, and while less expensive, they're not cheap and not covered by Medicaid or most LTC insurance.

I agree with this. Many LTC policies don't cover memory care or assisted living.

 

[Scuba]

Sorry... but this is incorrect information. Most LTC policies DO have a provision to cover care due to cognitive impairment. Many nursing homes now have a dedicated wing for alzheimer patients.

In order to qualify for benefits for nursing home care, one must demonstrate the inability to perform 2 out 6 of the ADL"S (activities of daily living). These include being unable to perform 2 out of 6 of : Bathing, Dressing, Eating, Toileting, Transferring, or Continence.

Cognitive Impairment is a separate provision in the policy. This was important to us as there is a history of dementia on my side of the family.

Depends on the policy and how the state you live in defines things. Caveat emptor.

 

[Dash man]

Sorry... but this is incorrect information. Most LTC policies DO have a provision to cover care due to cognitive impairment. Many nursing homes now have a dedicated wing for alzheimer patients.

In order to qualify for benefits for nursing home care, one must demonstrate the inability to perform 2 out 6 of the ADL"S (activities of daily living). These include being unable to perform 2 out of 6 of : Bathing, Dressing, Eating, Toileting, Transferring, or Continence.

Cognitive Impairment is a separate provision in the policy. This was important to us as there is a history of dementia on my side of the family.

I was referring to those who are considering self insuring long term care which comes out of their pocket. I also have a LTC policy even though I could easily afford to self insure for LTC only. Add in the memory card that can last for years with a history on both sides of our family, plus potential independent living and assisted living expenses prior to LTC needs, it can drain self funded folks bank accounts pretty quickly.

 

[pb4uski]

.... Hospital incompetency or surgeon indifference?

Yes?

 

[athena53]

I wonder if the insurance companies make most of their LTC money by people buying one, paying for x years then canceling.

Yes, there are assumptions about lapse rates baked into the pricing, as well as allowances for some policyholders dying without ever needing LTC. The problem with lapses is that typically the policyholders most likely to lapse are younger and healthier. The ones who know that Alzheimer's runs in the family or are starting to feel the need for LTC are more likely to continue paying premiums. It's probably one reason many insurers allow people to elect a lower level of coverage in place of a rate increase- to keep more healthy people in the program.

A word on what actually constitutes a valid claim in the eyes of an insurer- one poster here (Nords?) ended up having to pay for an expensive professional evaluation of his father because the insurance company disagreed that he needed LTC. Jim Cramer, the financial writer, encountered the same thing- he ended up spending as much fighting the (unnamed) insurer as he eventually collected. Choose an ethical company.

 

[ncbill]

Please say more about this consent form. My DW had brain surgery twice and I do recall seeing any waver of healthcare directive--only a box to check if there was one. At one of the surgery, DW did have to tell the surgeon she had a directive on file at the hospital. He had no idea. Hospital incompetency or surgeon indifference?

Yes.

The unfortunate reality is that you're not going to get a surgeon to operate unless you waive your loved one's right to choose versus the surgeon making the decisions, and they have a very powerful incentive for you not to die on their table.

Had the above personally happen to an older (80s) relative under general for hip replacement surgery.

They arrested on the table during the procedure, but were "successfully" resuscitated.

Only to arrest again, and die (DNR) a few days later...

 

[Senator]

If I ever need LTC for the duration, and I am lucid, I am getting home care until my assets run out. And I plan on having a great time while in my own home. Parties every night if needed. Loose women and hard liquor would be the theme.

Why would you want to go into a LTC facility for the duration, and possibly be treated poorly?

Once you go in for the duration, you no longer need assets when your get out, as you are coming out feet first.

 

[marko]

If I ever need LTC for the duration, and I am lucid, I am getting home care until my assets run out. And I plan on having a great time while in my own home. Parties every night if needed. Loose women and hard liquor would be the theme.

Why would you want to go into a LTC facility for the duration, and possibly be treated poorly?

Once you go in for the duration, you no longer need assets when your get out, as you are coming out feet first.

+1
This is a very real and good option (with or without the women and liquor).

Earlier this year my brother was faced with either LTC or coming home after a serious stroke. We chose home.

He was able to access a number of local 'elder services' for free (homemaking, food prep, bathing assistance etc) and his overall cost has been negligible; well within his means.

For us it wasn't the cost, it was the better general care we believe he'd get being in his own home. He's responded amazingly to this and continues to improve; not something I think we'd see if he was in a NH.

Eventually he may need assisted living etc but each year he's home is a plus and delays the cash outlay as well.

 

[Nords]

A word on what actually constitutes a valid claim in the eyes of an insurer- one poster here (Nords?) ended up having to pay for an expensive professional evaluation of his father because the insurance company disagreed that he needed LTC.

Yep. The main problem is that many insurers rely on "tests" like the Mini-Mental State Exam, which many Alzheimer's patients can still pass even in mid-stage.

Another problem is that insurers use the criteria of Activities of Daily Living: eating, bathing, dressing, toileting, transferring (walking), and continence. Again many Alzheimer's patients can do all of these things, but not necessarily safely and with problem-solving skills like running out of groceries.

Why I Won't Buy Long-Term Care Insurance - Military Guide

 

[pb4uski]

Since the Genworth LTC thread is unavailable and I had a thought to share on self-insuring for LTC, I decided to bump this thread.

According to the American Association of Long-Term Care Insurance website (http://www.aaltci.org/long-term-care-insurance/learning-center/probability-long-term-care.php):

For someone with a 90-day Elimination Period, the lifetime chance of someone buying coverage at age 60 and using policy benefits was 35%. So, 35% will use their coverage and 65% will not. As you might assume, the decline is because during those first 90 days, some people will recover and some will die.

Average Length of Stays (Nursing Homes)
5 years or more 12.0%
3 to 5 years 12.0%
1 to 3 years 30.3%
6 to 12 months 14.2%
3 to 6 months 10.0%
less than 3 months 20.0%

So, if you ignore the less than 3 months above because of the 90 day elimination period, the expected length of stay is about 2.13 years.... I'll round that up to 2.5 years to be conservative. At $85k/year (the average annual cost in my area) the expected value of claims is ~$74k (2.5 years * $85k a year * 35% chance of making a claim).

Worst case, assuming a 100% chance of a 7.5 year stay is $638k. Best case is $0.

I can afford the worst case though it wouldn't be easy but I just don't see the value of LTC insurance when I can self-insure.

 

[Golden sunsets]

What happened to the Genworth thread? I was looking forward to a few answers to some questions??

 

[Rianne]

I agree! My brother keeps telling us we need LTC insurance. In our area, depending on the care, living with some but minimal medical care, maybe a nurse on 24 hour call, in independent apartment with meals, it is @ $3000-$4000/month. We spend @ $6000 now. These are pretty nice apartments with kitchens. We live in our own home. A professor in the area who lived a shy over 100, had a full time nurse live in his home for @ $70K/year.

 

[samclem]

I can afford the worst case though it wouldn't be easy but I just don't see the value of LTC insurance when I can self-insure.

I think you are underestimating the exposure. A lot of LTCI payouts are for in home care, not NH. Also, you'd need to know readmission rates for NH care-- those who do live and check out after a year are not immunized against coming back.