Poll: Do You Have Long Term Care Insurance?

[friar1610]

Yes, we are in the Federal program. Have a relatively high deductible (our option). 3 years coverage for me; 5 years for my wife. Would probably cover about half the annual cost of nursing homes if we were to need it. Price has increased twice since we have enrolled (when the Fed contact is renewed with the provider every 5 years). In both cases we have opted to keep the premiums the same while forgoing some/all of the annual inflation adjustment to the benefits.

 

[bingybear]

Purchased LTC when we were 50. With the insurer we chose age 50 was a magical crossover point for premiums. Anyway, wife's mother, mother's twin sister, brother, and great aunt all had Alzheimers. Seemed prudent. One rate increase since then (the first ever for the company we use). I reduced my coverage enough to make up for the total increase..

How much coverage did you get? Does it last for life or fixed limited amount?

 

[Cricky]

I bought LTC for DW and me when it first became available from the Federal government. Not surprisingly it was too good to be true and the contract/prices had to be restructured several years later. But we modified our plan selections a bit and have stuck with it. We figure having a large customer base with OPM staff available to serve as a neutral watchdog will at least ensure a modicum of reliability. We want to leave a decent pot to our kids/grand-kids and see LTC as estate insurance.

I would have typed the same thing if Donheff hadn’t already done it. When faced with the changes in the renewed contract we took the middle-ground combination of a relatively small increase in premium with a small decrease in future inflation adjustments.

 

[nwsteve]

I answered "No" but we do have a deposit for a CCRC unit. Our thinking is that the CCRC provides a current benefit stream that we would not necessarily get from LTC insurance while still providing a large portion of the insurance benefits..

 

[nwsteve]

Christine Benz has a column today regarding LTC care. Each of her stats are linked to her data source:

https://www.morningstar.com/articles/879494/75-mustknow-statistics-about-longterm-care-2018-ed.html

A couple of stats that really caught my attention:

125: Number of insurers offering standalone long-term care policies, 2000. Fewer than 15: Number of insurers offering standalone long-term care policies, 2014.

$215,770: Average annual nursing-home cost, private room, Manhattan, 2017.
$51,100: Average annual nursing-home cost, private room, Monroe, Louisiana, 2017

52%: Percentage of people turning age 65 who will need some type of long-term care services in their lifetimes.

I responded "NO" on the poll but we have made a deposit on a CCRC unit. Our take is it will cover much of the risk while still providing a stream of benefits before additional care might be needed. And if you believe the CCRC marketing might even diminish the need. Is a CCRC better--kinda depends on the CCRC and how long you live and if you ever need advanced care. If it turns out you don't need the advanced care you at least got living benefits beyond an insurance receipt.

 

[trumpeting_angel]

Oops

I guess I don't see this like a catastrophic plan if I understand it. I would see a catastrophic plan where I would pay the first 2 to 3 years of LTC and the insurance would pay beyond those years. The amount the insurance company could pay would be large, but the likelihood would be small. I would expect the LTC annuity would be like a life insurance with LTC rider. Look at the expenses (that may be hard to find).

How would the annuity compare with a low cost variable annuity (fido/vanguard/schwab) where you could withdraw if you needed funds to pay for LTC?

Sorry, I was unclear. I don't think that the LTC annuity is equivalent to a catastrophic plan. Like you, I would like a plan with a couple of years' "deductible"/waiting period, and some coverage after that. The longest waiting periods in most plans I've looked at are 90 days, so I will look for a policy that covers some percentage of the amount. And apparently, move to Louisiana for my nursing home care.

 

[HI Bill]

I've seen dozens of similar declarations here over the years. My fiercely independent FIL was equally adamant he would never allow this to happen to him. Then he had a stroke...

IF I have any choice or say in the matter, I'm not going also. If I never set foot in any care facility or memory care unit, it will be too soon.

My mother also did not want to go. When she broke her pelvis, she begged not to be taken to the hospital. But there was no choice, she could not stand. When evaluating discharge options from the ER, they wanted to know the plan after physical therapy...They were satisfied that a memory care unit would take her.

 

[Mdlerth]

It just doesn't feel right

Self-insure. I've been turned off by the tales of massive price increases just as the policy owners reach the age when LTCi would be helpful. The old folks have to drop the policy, the insurance company keeps the decades worth of premiums, and I'm left shaking my head.

Are those stories just isolated anecdotes or are they representative? I dunno. But they illustrate the chief weakness of LTCi. Insurance of any type should provide a reduction in risk. That's what my auto/home/life policies do. LTC insurance adds an additional risk factor in place of the one it's supposed to mitigate.

I'll offer a brief, uninvited speculation here. I don't think the real solution to the high cost of long term care - or the high cost of many other health-related topics like surgeries and niche medications - is purchasing insurance. Someday somebody will come up with genuine solutions that don't cost the earth. No telling what those will be, but I have confidence in the endlessly creative potential of the human brain. Nanobots or prosthetics or tissue regeneration... any sci-fi reader knows we have only scratched the surface of the realm of potential technologies. Okay, I'm done speculating. Back to the original discussion!

 

[COcheesehead]

FIL pays $7000/month for care. Sound body, bad mind. 2 years into care. Will likely live for years. Wouldn’t want to be self insured under these circumstances.
The life insurance rider option makes so much sense, not sure why more don’t pursue it.

 

[Dtail]

FIL pays $7000/month for care. Sound body, bad mind. 2 years into care. Will likely live for years. Wouldn’t want to be self insured under these circumstances.
The life insurance rider option makes so much sense, not sure why more don’t pursue it.

Self insured combined with an irrevocable trust with spending some bucks to start and then converting to medicaid could work.

 

[COcheesehead]

Self insured combined with an irrevocable trust with spending some bucks to start and then converting to medicaid could work.

Went through that with my Dad. Waiting list for Medicaid beds.

 

[Chuckanut]

My LTC insurance is taking SS at 70. Given the weaknesses in the products I have reviewed, this seems like a better deal.

 

[Dtail]

Went through that with my Dad. Waiting list for Medicaid beds.

I was thinking of the concept that one starts their nursing home stay by paying X amount of money for X years, so they are accepted in and when the non trust monies run out, they are effectively allowed to stay on while converting to medicaid support.

 

[COcheesehead]

I was thinking of the concept that one starts their nursing home stay by paying X amount of money for X years, so they are accepted in and when the non trust monies run out, they are effectively allowed to stay on while converting to medicaid support.

I know an elder care lawyer. He told me there are loop holes with this strategy. Homes can refuse a patient who is “beyond their care”. They can’t kick them out once in, but if the patient is removed because of illness to another facility/hospital, they don’t have to let them back in. Leaving the patient in limbo.

 

[Dtail]

I know an elder care lawyer. He told me there are loop holes with this strategy. Homes can refuse a patient who is “beyond their care”. They can’t kick them out once in, but if the patient is removed because of illness to another facility/hospital, they don’t have to let them back in. Leaving the patient in limbo.

Thanks. Learn something new everyday. Thought I had something more solid here.

 

[Newventurer]

Rolling the dice, bought a policy for my DW only.

 

[REWahoo]

Rolling the dice, bought a policy for my DW only.

So the policy covers her, not you? Which means if she needs care you'll have help paying for it and if the reverse is true, she'll have to find a way to pay for your care?

Or do I have this reversed?

 

[Newventurer]

So the policy covers her, not you? Which means if she needs care you'll have help paying for it and if the reverse is true, she'll have to find a way to pay for your care?

Or do I have this reversed?

You have it correct, it’s a hybrid - I am self insured, she is not. Betting on the possibility that I’ll be out of the picture by the time she needs it, as she is younger. As I say it’s rolling the dice and how we chose to deal with the unknowns and semi-insure for them.

Stay tuned, I’ll let you know if I was right

P.S. - my experience with my DM tells me that males are a much lower % (25-30) in assisted living, again looking at odds which doesn’t offer any guarantees.

 

[Newventurer]

Some additional reading on the gender impact:

http://www.indiana.edu/~econdept/workshops/Fall_2008_Papers/Li_IHsin_Nursing_Home_stay_08072008.pdf

https://www.ltc-associates.com/ltc-is-a-womens-issue-or-is-it/#gs.NI2FUto

I read the above articles to say that men spend less on LTC primarily due to their spouse taking care of them in-home for a longer period. In the wife’s case the DH may be dead and no longer available to provide care. Be nice to your wife!

You will hear couples say that they got a ‘deal’ because they signed up for joint plans. Well the insurance companies aren’t being nice. They have the stats that prove they will pay out less on males than females. Apparently the individual pricing reflects the risk differential.

 

[PawPrint53]

My DH has a policy, but I was unable to get one. He would no longer qualify if he applied now (hip fracture, two types of cancer, lung issues) so I'm happy he got it when he did. The price hasn't risen too much.

 

[GalaxyBoy]

I said "yes" but it's actually only for DW. She bought into her employer's plan (state government) and was able to keep it in retirement. It only costs a little under $100 a year for a $75 per day benefit plan. Too bad I can't be added to it. I'll be self-insured, which I feel comfortable with given the options available.

 

[marko]

While it's what we plan, I'm just a bit surprised to see 70% of folks here deciding to self insure. Not what I was expecting having known you all for years now.

In our case, we'd just be switching one fairly expensive lifestyle for another albeit one with perhaps better tax deductions! It would only be marginally additive as the non-LTC spouse wouldn't be doing the things we would've done together.

Mom has LTC that she bought 25 years ago. $150 a month for a COLA'd $150K per year coverage. Not sure if there's a limit to it.

Of course, she's now 89, still drives, lives alone and 100% "with it" (until that second Cosmo kicks in). No telling if she'll ever collect on the investment.

 

[COcheesehead]

While it's what we plan, I'm just a bit surprised to see 70% of folks here deciding to self insure. Not what I was expecting having known you all for years now.

In our case, we'd just be switching one fairly expensive lifestyle for another albeit one with perhaps better tax deductions! It would only be marginally additive as the non-LTC spouse wouldn't be doing the things we would've done together.

Mom has LTC that she bought 25 years ago. $150 a month for a COLA'd $150K per year coverage. Not sure if there's a limit to it.

Of course, she's now 89, still drives, lives alone and 100% "with it" (until that second Cosmo kicks in). No telling if she'll ever collect on the investment.

My Dad had most of his medical costs in the last two years on earth. Lived to be almost 90. Money can go fast at the end, unfortunately.

 

[Corporateburnout]

I bought a policy 6 years ago but DW was denied. Two years later I was diagnosed with type 2 diabetes and would not have qualified.

 

[Out of Steam]

Insurance of any type should provide a reduction in risk. That's what my auto/home/life policies do. LTC insurance adds an additional risk factor in place of the one it's supposed to mitigate.

I looked at it a couple of years ago, and the finances look pretty much like prepayment for care. Basically, the policyholder doesn't get much financial leverage because they are insuring against a high-probability event. Not much difference from buying insurance against your shoes wearing out.