Let's talk Long-Term Care Insurance

[PrincessMommy]

Thinking out loud and would love to hear other people's experiences or thoughts on this issues.

 

My husband is approaching 60.  I have 2 older friends: one who got it and one who didn't.   It's clear that my friend with  LT insurance is getting better care.  Now it's too late for my one friend..she too old and has too many health needs that crept up on her. 

 

Anyway, has anyone done some research on the financial aspects of it and when is the best age to buy it?  Is it worth it for some income brackets but not for others?

 

The only article I've seen says "The wealthy probably don't need it because they can pay out of pocket."  Well, who is wealthy - and where?  I know by gov't standards I'm considered wealthy, but I live in a very expensive area and have 6 kids.

 

Also another consideration is life expectancy.  My husband's dad is still alive at 102, his mother is in her late 80s and going strong.  Grandparents are a mixed bag due to childhood illnesses and diabetes, but one grandparent lived to be 99 (and only died because of a freak nursing home accident).    My family hasn't fared so well, but much of it is due to life-style issues such as smoking  - which I don't do.

 

From what I've read, more and more long-term insurers are getting out.  So, if we start now and dh lives to be 100, will it be there when we need it?

 

[magnificent_baby]

My grandpa paid for it for years, but when he suffered a stroke, something in the fine print prevented it from kicking in. I cannot recall at all what the issue was, perhaps because he needed rehab in the nursing home. Wish I could remember.

 

He's now in assisted living which is about 1/4 the cost per day than the nursing home. It's perfect for his health status now.

 

ETA: My friend is a social worker in a nursing home. She fields calls all day from prospective families regarding costs, insurance, etc. It wouldn't hurt to make a few phone calls to nursing homes to ask their perspective.

[momto5blessings]

In my opinion, LTC is TOTALLY worth the money!  My dad purchased policies for himself and my mother many years ago through his employer.  Dad was diagnosed with dementia, and it completely covered his nursing home.  Without his insurance, we would have had to put him in a terrible place, because care is so expensive.  With this policy, he was able to be in a really nice place.

One thing he did wrong though, was he made the policy only good for the "average" life time stay of 4 years.  With his dementia, he potentially would have been in a care facility for much longer.  He died before the 4 years was up.  

I would, if I could afford it, opt for the lifetime benefit rather than limit it to a certain amount of years.

HTH,

Pamela

[Pawz4me]

DH and I hope to get it.  We'll probably start looking into it when we're near 60.  DH's parents had it for awhile and, after paying for several years, had to drop it because the premiums went up by such a large amount every year.  It got to the point they just couldn't afford it.  So we'll definitely be looking for something with a reasonable yearly cap on premium increases.

[J-rap]

I will be looking into long-term care insurance in the next ten years or so, but I don't really know much about it.  My husband no longer qualifies because of his stroke.  However, the best preparation of that type that my husband ever did was to get long-term disability insurance.  He got it exactly a month before his stroke.  I can't tell you what a life-saver this has been for us, and for our entire family.

[G5052]

We bought it over a decade ago, and no regrets.  One or both of us are very likely to need it.

 

FWIW, make sure that those in charge of your affairs know about it and are going to pursue using it.  My mother got it and paid on it for years, and then the person in charge of her care never bothered to file for it.  So probably $100,000+ down the tubes if you add up several years of partial coverage of her care and all the premiums. 

[SMRB]

We have it and bought it in our mid 30's to keep the premiums lower. I knew someone who had to move permanently to a nursing home right after birth from complications, and I was paranoid that something would happen to me, so we got it right before our son was born. We pay under $500/year for it and our rates will only increase if we take optional coverage increases.

 

My parents both had it, and we learned a lot when my father needed his. There is usually a waiting period between when you start using care and when you can use the benefits. It was 6 months for my father. My mother was very worried about exhausting the benefits because my father had dementia. She had him in adult day care a couple of days a week for a while but paid for it all out of pocket. When he needed more care, she still had to wait the 6 months without coverage because she had not notified the insurance that he was already in the day care, so those days of care didn't count. We all thought that he would be in a nursing home for years, so she was trying to stretch the benefits out to use then. By the time she decided to look at nursing homes and got through the waiting period, he went into home hospice. We moved him to a hospice house thinking he would be there for at least a year, but he had a major downturn the day we moved him in and died 2 weeks later. My mother could have gotten much more reimbursed if she had triggered the policy earlier.

 

LTC insurance is worth it to us because the cost is low and we have cash-out and premium reimbursement features. If you don't qualify for Medicaid, LTC costs will wipe you out if it happens. We did learn that. Even with the great coverage my parents had that you couldn't even buy today, they would have been financially wiped out by their portion of the costs for any good nursing home if my father had lived a few more years, and they still wouldn't have qualified for Medicaid. The LTC coverages offered are minimal compared to the total costs for care.

 

If you do buy it, make sure you are aware of the waiting periods and other conditions and how they work, and go ahead and don't be afraid to use it if you can qualify. Look for cash-out options and premium refunds in the event that you never have to use it. And I totally agree with the poster above - make sure those who would be making decisions know that it's there and also know about any waiting periods. We could have triggered the policy while my father was still manageable by using the adult day care earlier and more often. That would have saved tons of physical strain on the family during the waiting period.

[plansrme]

Y'all know this was resurrected by a spam post #6?  Not that it isn't always a relevant topic, of course.

[PrincessMommy]

Y'all know this was resurrected by a spam post #6?  Not that it isn't always a relevant topic, of course.

 

I saw that too, but the other comments afterward were very, very helpful.

[MysteryJen]

My parents had it and I would say read the fine print very, very carefully. As a someone else said, there are waiting periods and partial coverage, and limits. Also to know the numbers for average length of nursing home stays. People with dementia tend to react very badly to moving to a nursing home or care facility and the chances for needing care for years and years is unlikely.

 

Taking care to shield assets (legally, with an elder care attorney) is a very good use of money.

 

In my experience, the money paid out for my father's LTC insurance premiums was almost identical, slightly more, to the money paid out by the policy.  My dh and I are very much on the fence for LTC policies.

[LMA]

It depends. You need a policy that covers the cost per day of your nursing home stay. My neighbor had a policy for her mother for $120 a day, but the nursing home is $210 a day and going up. So she had to make up the difference, which meant selling the mother's house and other assets anyway. There is a waiting period, usually of 90 days. So you need to check that the policy would cover the daily cost of the nursing home and the amount of years. My neighbor's mother's policy is for 8 years, but they are wishing it was longer because the mother has been in the nursing home  for 6 1/2 years. 

[NorthwestMom]

My mother and stepfather had it.  My stepfather was in a nursing facility for about 6 months before he died, needing high levels of care due to a stroke. I have no idea how much they paid in premiums before that time, but I can't imagine the insurance company made any money on him at all.  My mother was in a dementia care facility for 3 years before she died. The benefit did not cover the cost completely, but including her SS benefit income, we only ended up paying $600 out of pocket every month.  Her benefits would have expired after 4 years of care, so honestly I am grateful she passed before we had to move her to a Medicaid facility and upset her routine and care.

 

I doubt my DH can qualify for long term care insurance, but we should definitely look at it for me, probably at age 50 or 55.