Long term care insurance

[SecondAttempt]

I'm trying to research long term care insurance. I know there are old threads and I have read them. They are about 5 years old so rather than necroing one I am starting a new one. If there is a recent one I could not find it.

We are 56 and 57. It seem that the earlier you purchase coverage the better in terms of lower premiums. But in the old threads there is discussion about companies not honoring level premium promises, ceasing coverage entirely, leaving the business, etc. So it seems like there is risk to starting early as well because you could lose everything you paid in.

I put together the table below to help me decise whether to start coverage soon. I can't say it helped me much though. The numbers came from an online calculator for Hawaii.

Age at purchase/ Annual premium/ if paid until 85/ Annual benefit
50 1804 63140 54000
55 2355 70650 62604
57 2715 76020 66600
58 2888 77976 68592
60 3175 79375 72576
65 4567 91340 84120

How do you all look at this? Do most people have LTC coverage? If you have it, when did you start and have your premiums remained level?

I should note that I get LTC coverage at work so if I continue that with the same company there may be some kind of recognition that I started many years ago. That is something to look into.

 

[big-papa]

We have LTC insurance that we purchased ourselves

We purchased it from NY Life when we were around 50 (we're early 60's now). At the time I did a lot of research on average/min/max rates for long term care in TX (including how fast its risen over time) along with what we could reasonably expect to self-fund based on our savings rate, etc.

There have been 2 major premium increases since we purchased our policies. In both cases, we adjusted my coverage downward to maintain approximately the same premium overall, given our relative risk factors.

With the last increase, NY Life added a rider which will freeze our premiums forevermore. They did this just before inflation took off.

Cheers.

 

[The Cosmic Avenger]

I only have LTCI because my company offered it to us at a really low rate -- I was paying about $240/yr starting at 36, and then when my company dropped it as a benefit and I had to take over their share, it "jumped" to $600/yr. Of course, after age, the main determinant of cost is usually the amount covered, and whether it's indexed for inflation, and I feel like I did OK with those (as I specified in the longer LTCI thread). If I hadn't been offered such a good deal, I probably wouldn't have taken it, because we were very careful with our money, and would prefer to self-insure.

 

[Teacher Terry]

A friend of mine has it and the premium keeps going up. She has her benefit adjusted down to keep the same payment.

 

[marko]

Having spent too much time in nursing homes while my brother was partially recovering from a stroke, here’s how I look at it:

The proverbial "$120,000" annual is not additive to your current spending. My experience is that the healthy spouse's life also changes dramatically with most non-core expenses slashed.

No more expensive dinners out, no more expensive vacations, get rid of the second car/second house and boat and you spend most of your day at the NH eating sandwiches and watching TV.

In short you might find as much as half the NH cost being covered by what you used to spend on other things.

YMMV

Having said that, we paid LTC premiums for mom for over 35 years only to have her pass at home quietly at age 93.

 

[Chuckanut]

Here in Washington state we have LTC for everybody who earns wages.

Starting July 1, 2026, benefits will become available so eligible Washington residents can have payments made to registered LTSS providers. Benefit eligibility will extend to individuals who have paid LTSS premiums for the equivalent of either (i) 10 years without an interruption of five or more consecutive years or (ii) three years within the last six years. Employees must have worked at least 500 hours per year. A shorter vesting time frame is available to individuals born before Jan. 1, 1968; see the Recent changes section for details.

Services qualifying for benefits include adult day care, professional services, family support, assisted living, nursing homes and more. The lifetime maximum benefit will be set at $36,500.

above emphasis added

IOW, if you end up qualifying for WA state LTC insurance, get better fast.

 

[EastWest Gal]

We have had Genworth LTC insurance for about 10 years. The premium has more than doubled (several years of 20%-30% increases) but with no increase in the dollar amount of benefits. We also decreased our benefits because of one of the increases. I called Genworth to complain and the agent I talked to mumbled about the cost of health care and I pointed out that LTC is not "health care" and that the dollar amount maximum was unchanged from 10 years ago so her answer made no sense.

We decided enough was enough. I started researching LTC insurance and found that NY Life was AARP sponsored, and decided to email for information. We were contacted by an independent agent who said she has been very busy moving people from Genworth this year due to the premium increases and that they were in financial trouble. She seems to be correct:

macroaxis.com/invest/ratio/GNW/Probability-Of-Bankruptcy#:~:text=Based%20on%20the%20latest%20financial,of%20the%20Insurance—Life%20industry.

Genworth has said that one of our options is to pay no more and the amount that of premium we have paid can be used for LTC. Of course if the company goes bankrupt, that is not going to happen. We're going with NY Life, which seems realistic, and paying a premium that is about half of what we were paying. We will get less benefit overall, but data suggests it will likely be enough to help protect most of the nest egg.

 

[youbet]

How do you all look at this? .

I don't have LTCI. The decision was based on:

1. We didn't consider it until we were 60 or so and it seemed expensive for the coverage we'd be getting.

2. I don't like the way benefits are structured. I'd be more interested in a high deductible (long waiting period) policy that has a very high upper limit than in a lower dollar policy that pays early, typically after 90 days. I don't need coverage for the first $200k or $300k. I'd likely appreciate some help if it runs up to a million+ bux or more though. It would start to impact what we'd been planning to leave our son and his family.

3. Too many horror stories concerning collecting if your situation is not straight forward

4. We can self-insure without drastic consequences to our legacy plans in all but the most drastic, statistically improbable situations.

Every situation is unique. You need to look at your current situation and bump that against your goals and your resources. Most people will pay in more for their LTCI than they collect from it (it's insurance!). It isn't automatically a money saving proposition, but it may be an avenue you want to follow depending on your personal details.

NOTE: Having said all that, we are looking at CCRC's and are very much considering going with a LifeCare (Type A contract) situation.

 

[kyzymurgist]

You may want to include Hybrid Life / LTCi policies in your research. About the nearest to a high deductible plan you'll find in my opinion. The major selling point for us was the locked in premium(s) with guaranteed no rate increases.

We went with OneAmerica Asset Care because of some unique features like joint LTC coverage with DW, joint life insurance, and lifetime Unlimited LTC coverage. We added a 5% inflation rider.

We opted for a maximum annual payout sufficient for Assisted Living and can self insure any shortage should more costly care be needed.

We had a friend diagnosed with Alzheimer's in her 50s only a year or so after purchasing a Cadillac LTCi policy that her husband adamantly oppossed. The lengthy institutional care would have been financially devastating.

After seeing that scenario, unlimited lifetime payout was a requirement for us and that is tough to find.

The hybrid policy is like high deductible insurance since you're spending your own money until the life policy is depleted.

 

[RobbieB]

Ah yes, Genworth. Know them well. Sure you get level premiums, just decreasing coverage.

Unless of course you want to pay more.

But when you do have a claim, good luck getting through the gauntlet of paperwork. Their staff is trained to avoid claims. Loss control professionals they are and they will not help you or answer your questions. Better hire a professional claim filer to navigate properly.

 

[RetMD21]

4. We can self-insure without drastic consequences to our legacy plans in all but the most drastic, statistically improbable situations.

Most people buy policies with relatively low lifetime maximums. I don't think there is any true high deductible insurance for low probability situations.

 

[youbet]

Most people buy policies with relatively low lifetime maximums. I don't think there is any true high deductible insurance for low probability situations.

Agreed.

 

[Montecfo]

We did not buy LTC for a number of reasons:

1. None of our parents benefitted from the policies. 2 ended up in nursing home but passed during the elimination period.

2. Not a good deal with rate increases and likelihood of use. Look at stats carefully. Lots of people end up in NH but benefit none or little from care. Stays are usually relatively short.

3. Lots of folks get older and decide the insurance is too expensive or not worth it and drop it after paying into it for decades. Fuzzy logic but the aged mind slips as to why this was a good idea in the first place.

3. We self insure, but if I wanted to insure I would use life insurance-payoff is certain.

 

[COcheesehead]

I had a hybrid life policy. It provided some level of comfort for LTC when we were younger. The cash value went up over time, but our assets outpaced it. I cashed it in about a year ago. We will now self insure as our assets are significant enough now.

 

[SecondAttempt]

2. I don't like the way benefits are structured. I'd be more interested in a high deductible (long waiting period) policy that has a very high upper limit than in a lower dollar policy that pays early, typically after 90 days. I don't need coverage for the first $200k or $300k. I'd likely appreciate some help if it runs up to a million+ bux or more though. It would start to impact what we'd been planning to leave our son and his family.

That is what I would prefer - high deductible with good coverage after that. It seems like that is what we already have through medicaid. You are covered once your assets are exhausted.

The simple fact is that I do not want to live in a nursing home for any length of time and would fight like mad to stay out even if it meant dying earlier at home.

I am still in relatively good health and I may feel differently in 20 years or so if something happens to me.

 

[Scuba]

That is what I would prefer - high deductible with good coverage after that. It seems like that is what we already have through medicaid. You are covered once your assets are exhausted.



The simple fact is that I do not want to live in a nursing home for any length of time and would fight like mad to stay out even if it meant dying earlier at home.



I am still in relatively good health and I may feel differently in 20 years or so if something happens to me.

I agree 100%. I definitely do not want to extend my life by moving into a Memory Care or SNF long term. That is not living IMO. DH is aware of my wishes, as are our healthcare POA’s. I can only hope the death with dignity laws will be sufficiently modified to address this situation, or that I am able to take a one way trip to Switzerland to avoid such a fate.

 

[ncbill]

Since I watched mom spend the better part of a decade bedridden simply due to the progress of her (some form of frontal-temporal lobe) dementia I plan to buy LTCi.

For care in a home or an ALF...after "experiencing" several during mom's illness, no SNFs for me!

I will also execute an extremely restrictive health care POA...any terminal illness, including dementia, palliative care only, no antibiotics...period...I'm content to let my first life-threatening illness be my last.

Most LTCi currently available is simply pre-paying the cost of LTC.

Hybrid life-insurance-based polices are significantly more expensive but allow you to pay "one & done."

 

[Dash man]

Just got my LTC bill today. Happy to report it did not increase and is exactly what it was last year.