More OT: Long term care insurance

[benb]

Originally Posted by reuben

If your statement is accurate (and I have no reason to believe that it's not), this is the kind of stuff that makes me furious.

And the insurers are STILL losing money hand over fist and exiting the market.

There are lots of articles on how badly this has all failed if you go searching. One description I've seen is "The worst failure in private health care."

[C40_guy]

Originally Posted by Ralph

(Florida has a 5 year claw back rule and beware of gift tax rules), and do what you can.

That might be a federal rule rather than state. It *is* the same here in Mass.

We may have already missed the window with my parents, but we're thinking about how to protect some assets just in case that 5 year window is still open...

[Ralph]

RE my MIL John Hancock LT care policy....in order for it to get "triggered", as I recall.....a Doc needed to sign off that she could not perform 3 of the "daily activities of living". Which include eating, bathing, dressing, toileting, being mobile, etc".

People in Independent Living, or assisted living, usually are not sick enough to trigger the policies. it usually takes the skilled care phase to get to get that determination.

This is why self paying people (who can never qualify for Medicaid anyway) are moving to retirement communities where you begin in the independent living phase, then progress to assisted living phase, and finally to skilled care or memory care. If you pay up front when you move in, you can avoid those huge expenses on the end.

My mother spent 17 years in a place that didn't accept Medicare or Medicaid. Very nice place....like a Country Club almost. We bought her in up front in independent living phase, and then as she progressed to assisted living, and finally to skilled care....her monthly bill never increased greater than the posted inflation rate plus in room meals and whatever extra supplies her care took. Some of the better off members of my high school graduating class are already moving to places like this.

And keep in mind....no matter what kind of insurance you have, Medicare or Medicaid, plus extra....you always have Medicare part A for the hospital visits when you are in nursing home. Every American gets Medicare part A in retirement. Even if you are Medicaid. And Medicare part A pays 20 days in nursing home (or rehab) every 6 months, no matter what kind of nursing home patient you are. The rules can get a little complicated.

[Ralph]

Originally Posted by C40_guy

That might be a federal rule rather than state. It *is* the same here in Mass.

We may have already missed the window with my parents, but we're thinking about how to protect some assets just in case that 5 year window is still open...

While there is a penalty if you move funds around in the 5 year window, it declines the closer you get to doing it 5 years earlier. Still worth doing. Fix up the house, prepay the funerals, if they drive buy expensive car, etc. In my MIL's case, we changed her car title to her "or" my wife....(not and) and Florida DMV didn't report to Florida DCF she got rid of a car (which Medicaid would have wanted).

If we had changed car title to just my wife, FL DMV would have notified DCF (Florida dept of children and families) that vehicle was gifted or sold, and wouldn't have worked.

[Ralph]

Another thing that kinda makes me mad is how the nursing home operators work. Or how they charge. My MIL is in a fairly decent place....they take good care of the patients. However.....before she qualified for Medicaid, while we were spending her down (what I left in her name after moving some assets around about 6 years before), her monthly bill was a little over $10,000 per month.

Now that she is a Medicaid patient.....I think the nursing home accepts what Medicaid pays for the room, which I think is about half what a private payer pays. So....in my MIL's case.....with her SS check (minus $130 for personal use) plus her LT care reimbursement, I think she is totally paying for her room. But she is still Medicaid....and not costing us tax payers a dime. Someone is paying though....the private payers.

[Blown Reek]

Originally Posted by ripvanrando

Except.....the company did not pay out.

I took your comment as your folks didn't end up needing the LTC insurance and bought in for nothing. I'm assuming, like car insurance, there are providers that are (much) better than others, and some are just plain scams. Just as Dude above has/had, my parents had Genworth too, for what it's worth. There were out-of-pocket expenses, of course, but getting reimbursed was relatively easy once the whole system worked.

Either way, it's a no-win situation.

[2LeftCleats]

When we placed my mother in assisted living, we were constantly battling the staff who found any minor excuse to increase her care. Each thing was $10-20/day and quickly ate into her finances. She and Dad paid into an LT policies for years. He died before tapping into his. When she finally let me manage her money, I sifted through old correspondence and discovered that though she started with one insurer, the policy was transferred to 2 other companies. I think she didn’t understand and quit paying. The company agreed to a fixed amount that she could use if she qualified. That vanished in a few months.

There ought to be a better system for caring for our elderly.

[thwart]

Originally Posted by 2LeftCleats

There ought to be a better system for caring for our elderly.

Yep. Most of us are going there.

Vote accordingly.

[54ny77]

The system sucks the dignity out of one's life.

I'll go mountain biking in the Alps with no brakes before I get to that point, hopefully many good years prior!

[C40_guy]

I had an initial conversation with USAA, which sells a John Hancock product.

The product is a universal life policy (or maybe whole life), with a care rider.

It is not LTC insurance. That product is largely obsolete.

The offer seems pretty straightforward. Start paying a premium now, coverage is immediate. if I do not need the coverage, the face value goes to my heirs (unlike insurance).

For $250K in coverage (or EOL payout), monthly for a healthy 60 year old is $400/month, ish. If interest rates go up, premiums can go down.

Feels like a hybrid approach might work best...save like hell and also take this coverage, mostly for the immediate coverage. If I knew that I wouldn't need it for 20 years, then self insuring would be much better. With this product you get an effective 3 or 4 to 1 return over the time period...

[yngpunk]

Originally Posted by C40_guy

I had an initial conversation with USAA, which sells a John Hancock product.

The product is a universal life policy (or maybe whole life), with a care rider.

It is not LTC insurance. That product is largely obsolete.

The offer seems pretty straightforward. Start paying a premium now, coverage is immediate. if I do not need the coverage, the face value goes to my heirs (unlike insurance).

For $250K in coverage (or EOL payout), monthly for a healthy 60 year old is $400/month, ish. If interest rates go up, premiums can go down.

Feels like a hybrid approach might work best...save like hell and also take this coverage, mostly for the immediate coverage. If I knew that I wouldn't need it for 20 years, then self insuring would be much better. With this product you get an effective 3 or 4 to 1 return over the time period...

Still might be worthwhile to do more due diligence and talk to insurers who still offer a LTC insurance product (while there are only a dozen or so companies offering LTC insurance, they are still out there). Also, might be worth checking if your employer offers the option via their benefits program.

[jimcav]

Originally Posted by C40_guy

if I do not need the coverage, the face value goes to my heirs (unlike insurance).

does face value mean the amount you have put in, and this goes to your heirs when you die without using the "care rider"? Or does 250k go to them simply because it is a life insurance policy?

I don't see how that is tenable for JH--$400/mo over 20 years is only 96k, most Americans aren't going to live past 80, so they (JH) will certainly lose money?

I must be misunderstanding what the product is

[Hellgate]

OP - I may or may not work for the company you mention. If I were you I may or may not invest my money into high quality stocks and skip the annuity with restrictive qualifications.

BTW...Shop around.

[C40_guy]

Originally Posted by Hellgate

OP - I may or may not work for the company you mention. If I were you I may or may not invest my money into high quality stocks and skip the annuity with restrictive qualifications.

BTW...Shop around.

Thanks for the heads up...and I will!

[C40_guy]

Originally Posted by yngpunk

Still might be worthwhile to do more due diligence and talk to insurers who still offer a LTC insurance product (while there are only a dozen or so companies offering LTC insurance, they are still out there). Also, might be worth checking if your employer offers the option via their benefits program.

Yes, I plan to, thanks!

My employer offers Genworth products, and coworkers who have done some research expressed concern about the company's long term financial stability.

Side note: It's nice to work for an organization where communities of interest (religious, LGBTQ, ethnicity, aging, etc) can openly talk about issues on distribution lists. It's in line with a strong focus on DEI...