LTCI Experience

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donall
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LTCI Experience

Post by donall » Sat Sep 02, 2017 6:53 pm

I am almost done with reimbursements from two LTCI policies that were utilized for end of life services for a relative. The relative was 90 and utilized LTCI for the last 5 months of life. She had two policies. Home care could be paid a total of about $180/day between the two policies, with higher coverage in a facility. She paid approximately $37,000 in premiums and was reimbursed about half of that in care for the last 5 months. One company is in liquidation while the other company has a reputation for being difficult to work with. The relative was provided care at home with a home care team as well as two relatives.

- both companies were professional, staff was kind and patient
- paperwork went fairly well with only two batchs of timesheets rejected. This was rectified by the home health agency.
- reimbursements were prompt and took less than 15 days
- contracts were difficult to read and follow in the beginning, but became second nature after a few months
- one definitely needs a person other than the insured to work with the insurance co. as well as recognize when to seek an evaluation for approval of LTCI payment
- having two policies had pluses that I won't go into as I think that is an infrequent occurrence

Financially LTCI was not worth buying in this case. But there was an elemental security that was reassuring. What were your experiences?

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TD2626
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Re: LTCI Experience

Post by TD2626 » Sat Sep 02, 2017 7:35 pm

First of all, I am sorry for your loss. Thank you for telling this story. It helpful to hear specific cases of how things turned out.

donall wrote:
Sat Sep 02, 2017 6:53 pm
Financially LTCI was not worth buying in this case.
Having had the insurance was probably worth it even without it having paid off more than the premiums. Having insurance for a tornado is a good idea regardless of whether it pays out or not. See this thread from Larry on not confusing strategy and outcome:
viewtopic.php?t=106117


I am interested in hearing about how a two company situation works - do you essentially submit bills to either company in this case? Which company pays first and which pays second?

bklyn96
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Re: LTCI Experience

Post by bklyn96 » Sat Sep 02, 2017 7:56 pm

donall wrote:
Sat Sep 02, 2017 6:53 pm
....What were your experiences?
We're glad we have LTC policies. I hope I never have to use mine but my wife has. Her policy's with TIAA/CREF/MetLife and was taken out in 1998. In 2013 she was diagnosed with a serious but manageable long-term illness. I tried handling caregiving on my own for two years but it became too much of a burden so we activated her policy. MetLife customer service has been professional and helpful throughout.

$16,301 paid out-of-pocket for home health care services during 90-day waiting period

$29,849 premiums paid between 1998 and 2016 when benefits started—premiums are not due while benefits are being received

Note the policy's 5% inflation factor still compounds the benefit pool even though no premiums are due

Note the state of New York allows a 20% income tax credit on LTC policy premiums so in my wife's case a total of $5,900 between 1998 and 2016

$70,142 benefits received to date

21 days average time between mailing invoice and receiving ETF reimbursement

Our home health aide's services cost $192 per day and are reimbursed 100%—the policy covers up to $241 per day for HHAs

$391,048 maximum lifetime benefits remaining

We have a substantial "health care reserve" invested in Vanguard Balanced Index and Wellington to cover anticipated expenses ~10 years from now when the benefit pool will be depleted

donall
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Re: LTCI Experience

Post by donall » Sun Sep 03, 2017 8:10 am

TD2626 wrote:
Sat Sep 02, 2017 7:35 pm
First of all, I am sorry for your loss. Thank you for telling this story. It helpful to hear specific cases of how things turned out.

donall wrote:
Sat Sep 02, 2017 6:53 pm
Financially LTCI was not worth buying in this case.
Having had the insurance was probably worth it even without it having paid off more than the premiums. Having insurance for a tornado is a good idea regardless of whether it pays out or not. See this thread from Larry on not confusing strategy and outcome:
viewtopic.php?t=106117


I am interested in hearing about how a two company situation works - do you essentially submit bills to either company in this case? Which company pays first and which pays second?
As I learned, LTCI does not work like health insurance. There is no primary insurance,so one can submit for reimbursement to both. The complexity is that each insurance has different criteria to begin the insurance, pays for different services, different elimination periods, etc. I suppose you can also only use one insurance at a time to spread out the benefits if the contracts allow.

End of life is very stressful. There were quite a few hoops to jump through to begin LTCI, but then it was reassuring to have bills paid, so I was grateful that is was there and it was worthwhile to have it.

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Shackleton
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Re: LTCI Experience

Post by Shackleton » Sun Sep 03, 2017 9:31 am

My mom has a LTCI policy with John Hancock (JH). It is very similar to bklyn's described above. I don't know when she and my father took out the policies (my father passed away in 2009). After some health issues for my mom, I took over her finances in 2010 and I know that the policy premium was $3300 at that time. In 2011, I activated the policy (so no premiums have been paid since then) as I had to move her to assisted living (AL), and it was very easy to get the LTCI reimbursements set up. I fax the monthly statement from AL to JH on the 1st, and they direct deposit the reimbursement at the end of the month (they only reimburse after the services are consumed.) Her lifetime benefit (which continues to accrue due to an inflation rider) is approximately $500,000. She has used about $340k of it thus far. At the current rate of her AL costs, the LTCI policy will cover another 2 years of expenses at which point we will obviously have to pay out of pocket but she has adequate investments to cover that.

Overall, it has obviously been a very good insurance policy for my mom. I'm pretty sure it is because of people like her that so many LTCI companies have stopped offering the policies, or changed the types of policies they offer. My mom has severe dementia, but very few other health problems, which is why she is in AL and she will be one of those people that lives in AL for >10 years. I think when companies first started offering LTCI, they never anticipated that so many people would be in similar situations as my mom. While there is obviously a lot of "turnover" in the AL/memory care facility residents where my mom lives, there are at least 4 others (out of 20 residents) that have been there >5 years (that is just off the top of my head.)
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Gnirk
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Re: LTCI Experience

Post by Gnirk » Sun Sep 03, 2017 10:50 am

Positive experience with Moms LTCI. 4 year payout policy at $145 per day. She paid less than $20,000 in premiums over approximately 20 years, the policy paid out approximately $210,000.

Her policy was strictly for a skilled nursing facility, and required the facility to have an RN on staff, as well as a physician services.
However, my mom was in a private care home, called an Adult Family Home in our state. The owner/ caregiver specialized in dementia care. There was no RN on staff, and no physicians services available on site. According to policy specifics, they would not pay for this type of care.

I submitted a claim anyway. I completed a lot of paperwork, as did mom's doctor and the owner/ caregiver of the home. The insurance company sent out their nurse to the home, and she spent a couple of hours interviewing the owner and observing the care.

Five months later I received a letter from the insurance company that said they were granting a " one-time exception to the policy rules" and would pay the claim " because of the excellent level of care she was receiving." We received reimbursements beginning 30 days from the date the claim was first received. The policy payout, a flat amount per day, covered all of her costs for four years. Mom suffered from Alzheimer's for 12 years, with 8 of those requiring Long Term Care. The other 4 years were private pay.

I would not have moved mom to a different facility in order to meet the insurance policies requirements if they had refused the claim. We would have continued private pay, because the care she was receiving was that good, and she was able to remain there through hospice and end of life.

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Watty
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Re: LTCI Experience

Post by Watty » Sun Sep 03, 2017 11:05 am

donall wrote:
Sat Sep 02, 2017 6:53 pm
Financially LTCI was not worth buying in this case. But there was an elemental security that was reassuring.
It might not have had a positive payback, especially when you consider that the money could have been invested but it may still have been worth buying if having it allowed the person to spend down their other funds with less concern about keeping a large amount of retirement savings to pay for LTC if they ever need it.

neilpilot
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Re: LTCI Experience

Post by neilpilot » Sun Sep 03, 2017 11:26 am

donall wrote:
Sat Sep 02, 2017 6:53 pm
Financially LTCI was not worth buying in this case. But there was an elemental security that was reassuring.
This has been my 45 year experience to date with our auto, home & umbrella coverage. Also with my Medicare B & D policies.

Doesn't mean the risk is sufficiently low to do without any of those. I also maintain our LTCI, which in my opinion has extremely low premium cost given the potential upside benefit.

Levett
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Re: LTCI Experience

Post by Levett » Sun Sep 03, 2017 11:54 am

neilpilot,

Thank you for your realistic perspective. It often gets lost in the sauce.

Further, I hope my wife and I don't have to use our LTCI policies, but what has been previously noted about TIAA/MetLife and JH squares with the experience of friends and acquaintances in our community.

Lev

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BolderBoy
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Re: LTCI Experience

Post by BolderBoy » Sun Sep 03, 2017 12:14 pm

My condolences on your loss.

Mother and father had JH policies, each with 90 day waiting periods. Both died rather quickly and well within the exclusionary period. Mom lamented at the end that the LTCI was a waste of 20 years of premium payments.

But it is insurance, not a guarantee of how the EOL will play out. (EOL = end of life)
"Never underestimate one's capacity to overestimate one's abilities" - The Dunning-Kruger Effect

beardsworth
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Re: LTCI Experience

Post by beardsworth » Sun Sep 03, 2017 1:38 pm

Since John Hancock has been mentioned more than once in this thread, it's probably worth noting that Hancock, apparently unable to figure out how to make a reliable profit from this product, stopped issuing new LTC policies in late 2016. It will, however, continue to service its existing policies, on which it also expects to keep asking regulatory permission to raise premiums.

https://www.bostonglobe.com/business/20 ... story.html

neilpilot
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Re: LTCI Experience

Post by neilpilot » Sun Sep 03, 2017 1:50 pm

beardsworth wrote:
Sun Sep 03, 2017 1:38 pm
Since John Hancock has been mentioned more than once in this thread, it's probably worth noting that Hancock, apparently unable to figure out how to make a reliable profit from this product, stopped issuing new LTC policies in late 2016. It will, however, continue to service its existing policies, on which it also expects to keep asking regulatory permission to raise premiums.

https://www.bostonglobe.com/business/20 ... story.html
Our LTCI are JH group policies that we bought in 1999, when we were 49. The policies include a 5% annual inflation rider, so the benefits have done reasonably well keeping up with our possible needs. The original JH literature indicates a fixed annual premium.

So far, our annual premium remain the original $800/year each. After reading the link, it's not clear to me if JH's attempt to raise premiums extends to policies with a FIXED premiums. Any information available on this?

beardsworth
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Re: LTCI Experience

Post by beardsworth » Sun Sep 03, 2017 2:29 pm

neilpilot wrote:
Sun Sep 03, 2017 1:50 pm
beardsworth wrote:
Sun Sep 03, 2017 1:38 pm
Since John Hancock has been mentioned more than once in this thread, it's probably worth noting that Hancock, apparently unable to figure out how to make a reliable profit from this product, stopped issuing new LTC policies in late 2016. It will, however, continue to service its existing policies, on which it also expects to keep asking regulatory permission to raise premiums.

https://www.bostonglobe.com/business/20 ... story.html
. . . it's not clear to me if JH's attempt to raise premiums extends to policies with a FIXED premiums. Any information available on this?
Sorry, but as the old saying goes, "I only know what I read in the papers." And the papers' contemporary version, i.e., websites and Google searches. . . . So I don't have any personal experience with Hancock's practices, whether concerning premiums or the handling of benefit claims, on policies already established.

Acepilot
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Re: LTCI Experience

Post by Acepilot » Sun Sep 03, 2017 2:49 pm

My mom has been diagnosed with mild to moderate cognitive impairment. Alzheimers does run in her family and her sister has it and their mother also had Alzheimer's. My mom purchased a policy in 1993 which only covers assisted living (AL) and nursing home (NH) coverage ( no home health care). The 100 day elimination period must be in either AL or NH which we must pay for while LTCi company reviews whether she qualifies for reimbursement. The criteria according to the contract is "Deteriotion or loss in her intellectual capacity which requires continual supervision to protect herself or others. ....". My brother and I both agree that she can no longer live alone, but does not seem to meet the stricter continual care definition. Our concern is that if we proceed with AL we may be denied coverage by LTCi company and then need to continue paying out of pocket. My mom has limited financial assets, but slightly above Medicaid threshold. She does own her home, $100k.

The options we see are. Use the investments she does have to pay some home health care 6-12 months and the 100 day elimination period costs about $25k + along with other upfront AL expenses. The second option we are leaning toward is selling the house and using proceeds to cover home health care and then placing her in AL while paying out of pocket until she meets requirements of LTCi definition. Depending on longevity 5 years she would then be eligible for Medicaid. We would appreciate others experience of when to start the claims process and handling limited finances, Medicaid and navigating this complex LTC stage. Thanks in advance for your reply.

bklyn96
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Re: LTCI Experience

Post by bklyn96 » Sun Sep 03, 2017 7:52 pm

Acepilot wrote:
Sun Sep 03, 2017 2:49 pm
....when to start the claims process....
I don't have any experience with your mother's condition but I would recommend discussing her LTC options with her doctors. I'm sure they'll be familiar with assisted living/nursing home requirements and candid if they think her condition won't qualify for benefits.

In my wife's case, once we contacted MetLife customer service to start the claims process it took 106 days to get authorized for benefits.

donall
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Re: LTCI Experience

Post by donall » Mon Sep 04, 2017 7:41 pm

bklyn96 wrote:
Sun Sep 03, 2017 7:52 pm
Acepilot wrote:
Sun Sep 03, 2017 2:49 pm
....when to start the claims process....
I don't have any experience with your mother's condition but I would recommend discussing her LTC options with her doctors. I'm sure they'll be familiar with assisted living/nursing home requirements and candid if they think her condition won't qualify for benefits.

In my wife's case, once we contacted MetLife customer service to start the claims process it took 106 days to get authorized for benefits.
The LTCI companies send forms to the patient's doctor and specialist (such as cardiologist etc.). A nurse representing the LTCI is also sent to assess the patient at their residence.

When I asked the relative's doctor about LTCI, he said she would probably qualify with most policies. The physician was supportive of the application process for LTCI.

About a year before my relative's death, a nurse in the doctor's office took me aside and recommended I find home health help for her now as the time would be soon when she needed help. I took her advice and began home health services a few hours a week and increased hours over a period of half a year. I'm glad I took the nurses' advice as when the relative's health rapidly deteriorated, services were in place and running smoothly.

ResearchMed
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Re: LTCI Experience

Post by ResearchMed » Mon Sep 04, 2017 7:56 pm

MIL (very elderly, approaching 100) has a type of LTCI that has probably been unavailable for quite some time.

For one thing, after something like 6 or 12 (I've just forgotten the specifics) months without a claim, the policy re-sets to the maximum claim that can be paid out.
She's used it a few times thus far, both relatively short-term, measured in weeks.
The one longer term case involved having a live-in health care aide for several months.

She needs to be unable to perform those regular basic self-care activities.
DH paid up front, and then submitted bills.

IF MIL becomes a bit more frail, she'll qualify for coverage in her Assisted Living Facility, in which case I'm assuming they'll pay directly, but it will only cover a modest percentage of the total.
(At that point, we won't be paying "up front". The ALF has already investigated the policy so they know what it will cover, and when, etc.)
And if she has to spend down completely, the Medicaid will kick in anyway. The ALF will keep residents once they are "in".

Somewhat surprisingly, there haven't been serious arguments about payments thus far.

RM
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