LTC insurance – keep or drop

[REWahoo]

DW and I met with an elder law attorney this morning to do some estate planning. I took the opportunity to discuss LTC insurance with her, specifically to ask her advice on keeping or dropping our existing policies.

For the record, I have continued to update this thread for several years, keeping track of the increases in premium rates we have experienced over the 16 years we've had our LTC policies. Summary: no increases until year 14, then a 50% increase and another 30% increase in year 16.

The question I asked our attorney wasn't about the affordability of the policies, but about the horror stories we have heard regarding the difficulty in gettting insurers to pay claims on these policies. I asked her what her experience had been with LTC insurers and if it were her, would she keep the policies.

She said she had more positive than negative experience in dealing with LTC insurance and in our financial situation would keep the policies. I asked if we ever needed to file a claim on the policies and met with difficulty, would her office assist us. Her response was, “The first thing I would do would be refer you to X, who is a Medical/LTC insurance claims advocate. I've worked with her on several occasions and had excellent outcomes.” I was unaware these “private claims advocates” existed, but learned they even had a national association, the Alliance of Claims Assistance Professionals (ACAP). Nice to know this resource is out there if we (or our children) need help dealing with the LTC claims process.

So bottom line, we will keep the policies as long as we think the premiums are affordable. Not sure how to define that precisely...

 

[samclem]

Her response was, “The first thing I would do would be refer you to X, who is a Medical/LTC insurance claims advocate. I've worked with her on several occasions and had excellent outcomes.” I was unaware these “private claims advocates” existed, but learned they even had a national association, the Alliance of Claims Assistance Professionals (ACAP). Nice to know this resource is out there if we (or our children) need help dealing with the LTC claims process.

Yes, its nice to know they are there, but it's unsettling that there are enough "issues" that there's a whole specialty dedicated to wresting deserved money from these insurers.

 

[REWahoo]

Yes, its nice to know they are there, but it's unsettling that there are enough "issues" that there's a whole specialty dedicated to wresting deserved money from these insurers.

Yes, like far too many things in life, it is a shame they have to exist.

But I am really glad they are there so our children won't have to arm wrestle with the insurer without professional help. That's one problem I definitely don't want to bequeath to my kids.

 

[Gotadimple]

Medicare/LTC Advocates don't just work to file claims with LTC companies, but also to aid a beneficiary in navigating the claim process with traditional Medicare. They review billings for errors and go to the biller to get corrections through the Medicare system thereby reducing out of pocket for their client.

 

[LARS]

Personally do not have LTC. Going self-insure route. However, I handled LTC insurance for my parents, within the last couple of years. They had policy with Travelers that morphed into MetLife (based upon my memory).

Had to jump through the required hoops (including for a while yearly re-qualify) and never had any issues. Met criteria with no arguing, etc. from insurer. Obviously YMMV but it was not an issue ever collecting on policy. And I would add for my parents was one of their very best investments (sadly as they would have preferred to never have had to collect).

 

[Senator]

I do not have LTC insurance. The VA should provide for me if and when I need it. If I am under 65, regular insurance should cover it. That is also VA for me.

I should have enough to self insure. If I go in with plenty of assets, and it is for the duration, I plan on spending like no tomorrow, right in the nursing home. I will be able to hire a cab to take me somewhere, or bring entertainment right to the home.

Many forms of LTC are covered by regular health insurance. If I am making improvements while in the LTC facility, regular insurance should cover the rehabilitation process. In the case of an accident or fall, this would be the case.

Worse case, I become a medicaid patient. I look at it as a choice. Have fun now, or pay premiums. If I am ever in a LTC facility, I may not even know it.

 

[MichaelB]

I do not have LTC insurance. The VA should provide for me if and when I need it. If I am under 65, regular insurance should cover it. That is also VA for me.

I thought most health insurance does not cover LTC, and the VA also does not cover LTC.

 

[kaudrey]

I thought most health insurance does not cover LTC, and the VA also does not cover LTC.

VA does not, although they do provide some help in certain situations. My uncle, who recently passed, suffered from Alzheimer's. My aunt opted to care for him with full-time care at home. They laid out about $60K a year for the last 3 years. VA didn't pay this and wouldn't have paid for a nursing home/assisted living either.

Having said that, VA gave them a stair-chair lift and various other equipment for free, which was nice.

 

[Senator]

I thought most health insurance does not cover LTC, and the VA also does not cover LTC.

Maye it depends on what LTC is. If you are in a nursing home temporaily, health insurance should cover it. An auto accicent, a fall, etc. As long as you are getting better, and showing improvement, it's more rehabilitation than a permenant nursing home. I have seen many people in their 40s-60s in a nursing home for a month or two.

If you go in for the duration, and are over 65, the insurance doesn't pay. I believe that you can even be on medicaid and there is no asset test if you are under 65.

To qualify for Minnesota's Medical Assistance, unmarried individuals over 65 may have no more than $3,000 in assets, subject to certain exclusions.

According to this document, a priority 3 paitent has $0 co-pay for Nursing Home Care Unit (NHCU). As a disabled vet, I am a priority 3.
https://www.va.gov/healthbenefits/resources/publications/IB10-431_copay_requirements_at_a_glance.pdf

Of course, anything could change.

 

[gerntz]

DW and I met with an elder law attorney this morning to do some estate planning. I took the opportunity to discuss LTC insurance with her, specifically to ask her advice on keeping or dropping our existing policies.

For the record, I have continued to update this thread for several years, keeping track of the increases in premium rates we have experienced over the 16 years we've had our LTC policies. Summary: no increases until year 14, then a 50% increase and another 30% increase in year 16.

Went thru similar increases recently. I divided the increased annual premium by the average cost of LTC/day in our area & even with the increase, it works out to 7-8 days in LTC to equal the annual premium for 5 yrs coverage. Net, even if it's 20 years till I go in LTC (age 89), if ever, that's still only 150 days to pay back premiums - not considering NPV. Yes, there's a 90 waiting period before payments kick in. Overall, I still consider it a relative bargain insurance. Will rates go up again in the next 20 years? Yes, but so will daily rates. If I don't ever use it? Great!!

 

[Senator]

Went thru similar increases recently. I divided the increased annual premium by the average cost of LTC/day in our area & even with the increase, it works out to 7-8 days in LTC to equal the annual premium for 5 yrs coverage. Net, even if it's 20 years till I go in LTC (age 89), if ever, that's still only 150 days to pay back premiums - not considering NPV. Yes, there's a 90 waiting period before payments kick in. Overall, I still consider it a relative bargain insurance. Will rates go up again in the next 20 years? Yes, but so will daily rates. If I don't ever use it? Great!!

I see most insurance covers $xx per day. Does your insurance have an inflation rider? Or does it cover xx days, no matter what the cost?

I wonder what $200 a day coverage today will cover in 20+ years.

 

[aja8888]

VA/gov version of LTC is a Medicaid nursing home. Not pretty.

 

[rodi]

I thought most health insurance does not cover LTC, and the VA also does not cover LTC.

There are veterans nursing homes where qualified vets have a lower spend down than the medicaid spend down. (Spend down is 80k in assets - excluding home and car). There are also income tests. You have to have served at least one day during wartime.

Like medicaid - your income is 100% applied towards your expenses - and the balance is made up by the VA.

There is also home health aid/assistance available. The VA has figured out this is cheaper than a residential nursing home.

Most have long waiting lists. We looked into this for FIL. (He served in WWII so he qualified).

They are run on a state by state basis - and you may need to qualify residency for that state for a year. We ran into that with FIL - MIL wanted to be back in Philly and have FIL in the Vets home there... but there was a 1 year PA residency before being placed on the list... At the time they lived in Kentucky.

There are also shorter term nursing/rehab homes for vets. FIL used one of these two times after hospitalizations to continue recovery before being sent home.

Geriatrics and Extended Care Home

 

[rodi]

VA/gov version of LTC is a Medicaid nursing home. Not pretty.

Some are nicer than others. My family toured the one in Philly (more like your medicaid nursing home) the one in State College (medium) and the one outside Lexington, Kentucky (new shiny and nicer than the non-medicaid places we toured.

The reason we didn't go for the Kentucky one is that MIL doesn't drive (never has) and there was not adequate bus service to go the 30 miles to the home.

But not all are bad.

 

[Senator]

VA/gov version of LTC is a Medicaid nursing home. Not pretty.

My father was in the Minneapolis VA LTC facility for 5+ years. He was in a private pay the first 14 months, while waiting to get into the VA home. There was a 8 month wait to get into the VA, and a 12-month look back period for assets. I waited about 4 months and put him on the list.

The VA facility was not too bad. Certainly a lot better than the private pay room he had at first.

As I recall, the VA allowed the patient to keep the first $100 of income each month, make any payments he owed, then they took the remaining 95% of his monthly income. No asset tests since he was broke by the time he went in.

We actually briefly looked at my DGF marrying him for both asset protection and survivor benefits, but decided against it.

Looking back, I should have had him buy a nice truck before he went in, as the financial obligation would have been a payment he could have made that would not have affected his payments.

 

[audreyh1]

REWahoo: How did you find your elder attorney?

 

[gerntz]

I see most insurance covers $xx per day. Does your insurance have an inflation rider? Or does it cover xx days, no matter what the cost?

I wonder what $200 a day coverage today will cover in 20+ years.

It covers 5 years at the $/day coverage level I have. There periodic options to increase coverage/day & thus of course payments.

$200/day coverage in 20 years will cover $200/day - unless you have a built in inflation clause.

 

[REWahoo]

REWahoo: How did you find your elder attorney?

Google

Actually I did do some online searches and came across the name of an elder law attorney that I recall hearing some good things about a few years ago. Everything I could find on her was very positive, so we scheduled an introductory appointment. DW and I both liked her so we agreed to let her work up an estate plan for us.

 

[mathjak107]

we are keeping ours . the perks after the insurance runs out with our partnership plan are really what we wanted .

john hancock is no longer selling new policy's .

the reason is all these statistics you see thrown around are skewed about how little is spent on ltc care typically. evidently the number of people and the costs are far higher then any numbers out there are reflecting .