Long term care insurance?

[Anonymous]

What is it most useful for? We recently went through a temporary need for care for a family member and I’m remembering that LTC insurance wasn’t that useful. I’m facing a potential need for extra hc assistance when I’m older (hopefully >20 years from now) (based on family history) and wondering if LTC insurance could be helpful.

[Anonymous]

We bought LTCi for the same reason you are looking at it. We had to pay out of pocket for care for family member which is hugely expensive.

We bought plans for each of us that cover $200/day inflation adjusted for up to 3 years--in home or in a nursing home. Right now that is about 1/2 day of help.

You also have to qualify to get the help, which I think it meeting X number of the 5 qualifying factors. Can't feed, bathe, walk....

You also have to wait 90 days to qualify, but generally MediCARE covers 90 days in rehab facility after surgery.

For something like Alzheimers I think you just have to pay out of pocket until you meet the 90 days.

A lot of people say you are better off self-insuring. It's just that most people can't afford to pay. We are hedging our bets and insuring for 1/2 day and self insure for the remainder.

[Anonymous]

Last time I looked, for a couple, it would cost about $400,000 for $700,000 worth of care. If you don't need a lot of care, you would save the $400,000 and only pay for the lower amount of care that was needed.

[Anonymous]

Anonymous[b wrote:]Last time I looked, for a couple, it would cost about $400,000 for $700,000 worth of care. If you don't need a lot of care, you would save the $400,000 and only pay for the lower amount of care that was needed.[/quo[/b]te]


This. Also policies don't actually cover very much. And be prepared to fight them every step of the way over coverage.

[Anonymous]

My financial planner presented me with some options. The benefit of the insurance didn’t really offset the cost. He put me into an annuity that will essentially do the same thing. Except if I don’t use it, it will go to my kids rather than be a sunk cost premium.

[Anonymous]

Anonymous wrote:

Anonymous[b wrote:]Last time I looked, for a couple, it would cost about $400,000 for $700,000 worth of care. If you don't need a lot of care, you would save the $400,000 and only pay for the lower amount of care that was needed.

This. Also policies don't actually cover very much. And be prepared to fight them every step of the way over coverage.

and that's assuming the insurance company is still solvent 20 years from now. The sate guarantees have caps far lower than what you will pay in let alone the promised benefits. In Virginia, Maryland and DC, the limit is 100k

[Anonymous]

Anonymous wrote:My financial planner presented me with some options. The benefit of the insurance didn’t really offset the cost. He put me into an annuity that will essentially do the same thing. Except if I don’t use it, it will go to my kids rather than be a sunk cost premium.

How much did you put into the annuity?

[Anonymous]

I know someone who passed away recently. LTCI covered living in a memory care facility. She lived in their senior section for about 10 years (not sure if it was a condo or a rental) and lived relatively independently. She was transferred to the memory care section when her mind went, and that's when the LTCI kicked in. It worked for her?

I've had enough experience with insurance companies forcing you to fight them every inch of the way, to be leery of these policies. It worked in her case, but it's exhausting and upsetting to be fighting insurance companies when you need the policies you paid for.

[Anonymous]

The market is changing and will not be the same in 20 years. Premiums can increase on policies. The biggest issue is that no policy will protect you from the financial ruin of a long term stay which is the point of insurance. The point of a modest three year policy would be to protect some of your portfolio for a surviving spouse. If your portfolio is very large maybe you decide you don’t need it.

[Anonymous]

Anonymous wrote:My financial planner presented me with some options. The benefit of the insurance didn’t really offset the cost. He put me into an annuity that will essentially do the same thing. Except if I don’t use it, it will go to my kids rather than be a sunk cost premium.

So financial planner sold you his product and not the insurance guys product. Got it.

[Anonymous]

Our finance guy said it is a gamble...no way to know what you will need. My father just passed away . Medicare covered about 30 days of rehab after a hospital stay. Then they proclaimed him well enough to leave. We then had to self pay as he was very far from being able to be home. He died a few weeks later. He had Parkinson's. We thought they would need lots of care.

[Anonymous]

Anonymous wrote:

Anonymous[b wrote:]Last time I looked, for a couple, it would cost about $400,000 for $700,000 worth of care. If you don't need a lot of care, you would save the $400,000 and only pay for the lower amount of care that was needed.[/quo[/b]te]


This. Also policies don't actually cover very much. And be prepared to fight them every step of the way over coverage.

My mother-in-law's policy covered the full cost of her care in the assisted-living facility. Then, when COVID hit, we moved her in with us and the policy paid for the home health aide. Her policy even paid for a walk-in shower and grab bars to be installed.

The only thing she had to pay was the first 90 days and there were a few nights when we were gone on a business trip where we needed to pay out of pocket for the home health aide to stay over night.

[Anonymous]

Anonymous wrote:Last time I looked, for a couple, it would cost about $400,000 for $700,000 worth of care. If you don't need a lot of care, you would save the $400,000 and only pay for the lower amount of care that was needed.

$400,000?
My mother-in-law's premium was about $300 per month. Why would someone spend $400,000 on an insurance policy? That's ridiculous.

[Anonymous]

Anonymous wrote:The market is changing and will not be the same in 20 years. Premiums can increase on policies. The biggest issue is that no policy will protect you from the financial ruin of a long term stay which is the point of insurance. The point of a modest three year policy would be to protect some of your portfolio for a surviving spouse. If your portfolio is very large maybe you decide you don’t need it.

I have a policy called a "Long-Term Care Partnership Policy". If the policy runs out of benefits, my assets are still protected. I don't have to spend down all of my assets.

[Anonymous]

Anonymous wrote:

Anonymous wrote:My financial planner presented me with some options. The benefit of the insurance didn’t really offset the cost. He put me into an annuity that will essentially do the same thing. Except if I don’t use it, it will go to my kids rather than be a sunk cost premium.

So financial planner sold you his product and not the insurance guys product. Got it.

Yep!