Why I don't think I should get long term care insurance right now

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willthrill81
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Re: Why I don't think I should get long term care insurance right now

Post by willthrill81 »

Gardner's Son wrote: Sun Jul 28, 2019 7:21 am While I have forgotten all of the particulars, I (male) bought a LTC policy when I turned 55 (2005) for about $2,000/year. I am now 69. I believe it covered $300/day with a max of $1,000,000 total coverage? As owners of a small business, we deducted this expense. After 20 years, the policy is completely paid off and coverage continues until needed or not. Each year there was an option to pay a bit more for inflation - it was not much more per month and typically we purchased this option. There was a 30 or 60-day waiting period. In other words, I couldn't receive benefits right a way if I qualified based on the 3 daily chores (i.e., change clothes by myself, bath, feed, etc.) I could not do. It included home care which I was very interested in. It was a NY Life product - well-written and sound. Each year we get a letter from NY Life regarding the inflation option. I doubt that this policy is still being sold as the price was very reasonable and health care costs have gotten crazy over the past 10 years.

At the time (2005), I was in the process of transitioning from a teaching job to free lance consulting/grant writing and wanted to have something to fall back on if we didn't make the jump successfully. At this time, we could weather the LTC storm with the available resources accumulated over the past 15 or so years. Hope we never have to use it!
If policies with those premiums and benefits were still available today, many here, including myself, would be all over them. $1 million of coverage for LTC for $40k was a great deal. Sadly, those policies haven't been available for a while and are very unlikely to ever be offered again.

At this point, the best that many of us could hope for is a LTC policy with a long exclusion period (e.g. 3 years) or a high 'deductible' (e.g. $300k). That would cover the truly catastrophic LTC events, and due to the rarity of such events, the policy would not be nearly as costly as traditional LTC insurance.
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings
WoW2012
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Re: Why I don't think I should get long term care insurance right now

Post by WoW2012 »

willthrill81 wrote: Sun Jul 28, 2019 1:49 pm
Gardner's Son wrote: Sun Jul 28, 2019 7:21 am While I have forgotten all of the particulars, I (male) bought a LTC policy when I turned 55 (2005) for about $2,000/year. I am now 69. I believe it covered $300/day with a max of $1,000,000 total coverage? As owners of a small business, we deducted this expense. After 20 years, the policy is completely paid off and coverage continues until needed or not. Each year there was an option to pay a bit more for inflation - it was not much more per month and typically we purchased this option. There was a 30 or 60-day waiting period. In other words, I couldn't receive benefits right a way if I qualified based on the 3 daily chores (i.e., change clothes by myself, bath, feed, etc.) I could not do. It included home care which I was very interested in. It was a NY Life product - well-written and sound. Each year we get a letter from NY Life regarding the inflation option. I doubt that this policy is still being sold as the price was very reasonable and health care costs have gotten crazy over the past 10 years.

At the time (2005), I was in the process of transitioning from a teaching job to free lance consulting/grant writing and wanted to have something to fall back on if we didn't make the jump successfully. At this time, we could weather the LTC storm with the available resources accumulated over the past 15 or so years. Hope we never have to use it!
If policies with those premiums and benefits were still available today, many here, including myself, would be all over them. $1 million of coverage for LTC for $40k was a great deal. Sadly, those policies haven't been available for a while and are very unlikely to ever be offered again.

At this point, the best that many of us could hope for is a LTC policy with a long exclusion period (e.g. 3 years) or a high 'deductible' (e.g. $300k). That would cover the truly catastrophic LTC events, and due to the rarity of such events, the policy would not be nearly as costly as traditional LTC insurance.

A 55-year old couple, in excellent health, could share $1.5 million in benefits for $1,500 per year per spouse. That's a pretty good deal.



Disclaimer: I am a licensed insurance professional and am certified as a long-term care insurance specialist.
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willthrill81
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Re: Why I don't think I should get long term care insurance right now

Post by willthrill81 »

WoW2012 wrote: Sun Jul 28, 2019 11:00 pm
willthrill81 wrote: Sun Jul 28, 2019 1:49 pm
Gardner's Son wrote: Sun Jul 28, 2019 7:21 am While I have forgotten all of the particulars, I (male) bought a LTC policy when I turned 55 (2005) for about $2,000/year. I am now 69. I believe it covered $300/day with a max of $1,000,000 total coverage? As owners of a small business, we deducted this expense. After 20 years, the policy is completely paid off and coverage continues until needed or not. Each year there was an option to pay a bit more for inflation - it was not much more per month and typically we purchased this option. There was a 30 or 60-day waiting period. In other words, I couldn't receive benefits right a way if I qualified based on the 3 daily chores (i.e., change clothes by myself, bath, feed, etc.) I could not do. It included home care which I was very interested in. It was a NY Life product - well-written and sound. Each year we get a letter from NY Life regarding the inflation option. I doubt that this policy is still being sold as the price was very reasonable and health care costs have gotten crazy over the past 10 years.

At the time (2005), I was in the process of transitioning from a teaching job to free lance consulting/grant writing and wanted to have something to fall back on if we didn't make the jump successfully. At this time, we could weather the LTC storm with the available resources accumulated over the past 15 or so years. Hope we never have to use it!
If policies with those premiums and benefits were still available today, many here, including myself, would be all over them. $1 million of coverage for LTC for $40k was a great deal. Sadly, those policies haven't been available for a while and are very unlikely to ever be offered again.

At this point, the best that many of us could hope for is a LTC policy with a long exclusion period (e.g. 3 years) or a high 'deductible' (e.g. $300k). That would cover the truly catastrophic LTC events, and due to the rarity of such events, the policy would not be nearly as costly as traditional LTC insurance.

A 55-year old couple, in excellent health, could share $1.5 million in benefits for $1,500 per year per spouse. That's a pretty good deal.

Disclaimer: I am a licensed insurance professional and am certified as a long-term care insurance specialist.
1. What type of policy are you referring to (e.g. traditional LTCi, hybrid, etc.)?
2. Can the premiums increase and, if so, how is that determined or limited?
3. Do benefits change over time?
4. Are those premiums ongoing or limited in duration?
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings
WoW2012
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Re: Why I don't think I should get long term care insurance right now

Post by WoW2012 »

willthrill81 wrote: Sun Jul 28, 2019 11:31 pm
WoW2012 wrote: Sun Jul 28, 2019 11:00 pm
willthrill81 wrote: Sun Jul 28, 2019 1:49 pm
Gardner's Son wrote: Sun Jul 28, 2019 7:21 am While I have forgotten all of the particulars, I (male) bought a LTC policy when I turned 55 (2005) for about $2,000/year. I am now 69. I believe it covered $300/day with a max of $1,000,000 total coverage? As owners of a small business, we deducted this expense. After 20 years, the policy is completely paid off and coverage continues until needed or not. Each year there was an option to pay a bit more for inflation - it was not much more per month and typically we purchased this option. There was a 30 or 60-day waiting period. In other words, I couldn't receive benefits right a way if I qualified based on the 3 daily chores (i.e., change clothes by myself, bath, feed, etc.) I could not do. It included home care which I was very interested in. It was a NY Life product - well-written and sound. Each year we get a letter from NY Life regarding the inflation option. I doubt that this policy is still being sold as the price was very reasonable and health care costs have gotten crazy over the past 10 years.

At the time (2005), I was in the process of transitioning from a teaching job to free lance consulting/grant writing and wanted to have something to fall back on if we didn't make the jump successfully. At this time, we could weather the LTC storm with the available resources accumulated over the past 15 or so years. Hope we never have to use it!
If policies with those premiums and benefits were still available today, many here, including myself, would be all over them. $1 million of coverage for LTC for $40k was a great deal. Sadly, those policies haven't been available for a while and are very unlikely to ever be offered again.

At this point, the best that many of us could hope for is a LTC policy with a long exclusion period (e.g. 3 years) or a high 'deductible' (e.g. $300k). That would cover the truly catastrophic LTC events, and due to the rarity of such events, the policy would not be nearly as costly as traditional LTC insurance.

A 55-year old couple, in excellent health, could share $1.5 million in benefits for $1,500 per year per spouse. That's a pretty good deal.

Disclaimer: I am a licensed insurance professional and am certified as a long-term care insurance specialist.
1. What type of policy are you referring to (e.g. traditional LTCi, hybrid, etc.)?
2. Can the premiums increase and, if so, how is that determined or limited?
3. Do benefits change over time?
4. Are those premiums ongoing or limited in duration?

1. What type of policy are you referring to (e.g. traditional LTCi, hybrid, etc.)?
Traditional

2. Can the premiums increase and, if so, how is that determined or limited?
Rate increases are limited according to the Rate Stability Regulation (if the policy is purchased in one of the 41 states that has enacted the Rate Stability Regulation.)

3. Do benefits change over time?
No (unless the policyholder decides to decrease his/her benefits)

4. Are those premiums ongoing or limited in duration?
Those premiums are payable until the policyholder begins receiving benefits.
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willthrill81
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Re: Why I don't think I should get long term care insurance right now

Post by willthrill81 »

WoW2012 wrote: Mon Jul 29, 2019 12:07 am
willthrill81 wrote: Sun Jul 28, 2019 11:31 pm
WoW2012 wrote: Sun Jul 28, 2019 11:00 pm
willthrill81 wrote: Sun Jul 28, 2019 1:49 pm
Gardner's Son wrote: Sun Jul 28, 2019 7:21 am While I have forgotten all of the particulars, I (male) bought a LTC policy when I turned 55 (2005) for about $2,000/year. I am now 69. I believe it covered $300/day with a max of $1,000,000 total coverage? As owners of a small business, we deducted this expense. After 20 years, the policy is completely paid off and coverage continues until needed or not. Each year there was an option to pay a bit more for inflation - it was not much more per month and typically we purchased this option. There was a 30 or 60-day waiting period. In other words, I couldn't receive benefits right a way if I qualified based on the 3 daily chores (i.e., change clothes by myself, bath, feed, etc.) I could not do. It included home care which I was very interested in. It was a NY Life product - well-written and sound. Each year we get a letter from NY Life regarding the inflation option. I doubt that this policy is still being sold as the price was very reasonable and health care costs have gotten crazy over the past 10 years.

At the time (2005), I was in the process of transitioning from a teaching job to free lance consulting/grant writing and wanted to have something to fall back on if we didn't make the jump successfully. At this time, we could weather the LTC storm with the available resources accumulated over the past 15 or so years. Hope we never have to use it!
If policies with those premiums and benefits were still available today, many here, including myself, would be all over them. $1 million of coverage for LTC for $40k was a great deal. Sadly, those policies haven't been available for a while and are very unlikely to ever be offered again.

At this point, the best that many of us could hope for is a LTC policy with a long exclusion period (e.g. 3 years) or a high 'deductible' (e.g. $300k). That would cover the truly catastrophic LTC events, and due to the rarity of such events, the policy would not be nearly as costly as traditional LTC insurance.

A 55-year old couple, in excellent health, could share $1.5 million in benefits for $1,500 per year per spouse. That's a pretty good deal.

Disclaimer: I am a licensed insurance professional and am certified as a long-term care insurance specialist.
1. What type of policy are you referring to (e.g. traditional LTCi, hybrid, etc.)?
2. Can the premiums increase and, if so, how is that determined or limited?
3. Do benefits change over time?
4. Are those premiums ongoing or limited in duration?

1. What type of policy are you referring to (e.g. traditional LTCi, hybrid, etc.)?
Traditional

2. Can the premiums increase and, if so, how is that determined or limited?
Rate increases are limited according to the Rate Stability Regulation (if the policy is purchased in one of the 41 states that has enacted the Rate Stability Regulation.)

3. Do benefits change over time?
No (unless the policyholder decides to decrease his/her benefits)

4. Are those premiums ongoing or limited in duration?
Those premiums are payable until the policyholder begins receiving benefits.
Thanks.

How much would the premiums be if the couple was age 65 or 70 when they took it out?
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings
rgs
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Re: Why I don't think I should get long term care insurance right now

Post by rgs »

WoW2012 wrote: Wed Jul 24, 2019 12:06 pm
FBN2014 wrote: Wed Jul 24, 2019 11:26 am
WoW2012 wrote: Mon Jul 22, 2019 11:12 pm
willthrill81 wrote: Wed Jul 17, 2019 9:38 am
Mr.BB wrote: Wed Jul 17, 2019 8:30 am We just started looking at LTC insurance. The hard part is trying to figure out how much you need without becoming "insurance poor".
The rates (2 different companies) have range from about $300 a month for both of us with a 3% inflation ryder, comes out to be about $100 a day coverage for 3 years.
It's common, but I really don't see the point in most situations for folks to have LTC insurance that only covers the first three years. If you have enough assets to really justify buying LTC insurance, which is often largely a means of protecting your assets and not actually getting LTC since you'll qualify for Medicaid when your assets are gone, then you should be able to cover the first three years of LTC out of pocket. The LTC scenarios that could really put you in financial straits are those lasting longer than three years, much longer.

Someone with modest assets can protect all of their assets from Medicaid by buying an affordable Long-Term Care Partnership Program (if they live in one of the 44 states that offer these programs.) This is a special type of long-term care insurance which has changed the rules regarding Medicaid spend-down and Medicaid estate recovery.

The beauty of the Partnership Program is that you only have to buy an amount of long-term care insurance that is equal to the amount of assets you want to protect from Medicaid. This makes the policies very affordable for those with more modest assets.


Disclaimer: I am a licensed insurance professional and am certified as a long-term care insurance specialist.
Do the partnership LTC policies include the hybrid plans offered by One America, Nationwide, Lincoln? How about whole life insurance with a living benefits rider?
No. Hybrid policies do NOT qualify as long-term care partnership policies.

But the insurance industry doesn't want you to know that. The industry, as a whole, would prefer everyone bought hybrids. There's a lot more profit in the hybrids than there is in traditional LTC insurance.
WoW2012 - I am not following this statement "Hybrid policies do NOT qualify as LTC partnership policies". I am looking at a hybrid plan with inflation protection (I have the ability to do a 1035 from an existing cash value LI policy) that looks to have a good LTCI. If you can clarify this "Do not qualify" on what it means, I would appreciate it. Thanks
WoW2012
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Re: Why I don't think I should get long term care insurance right now

Post by WoW2012 »

rgs wrote: Mon Jul 29, 2019 7:46 pm
WoW2012 wrote: Wed Jul 24, 2019 12:06 pm
FBN2014 wrote: Wed Jul 24, 2019 11:26 am
WoW2012 wrote: Mon Jul 22, 2019 11:12 pm
willthrill81 wrote: Wed Jul 17, 2019 9:38 am

It's common, but I really don't see the point in most situations for folks to have LTC insurance that only covers the first three years. If you have enough assets to really justify buying LTC insurance, which is often largely a means of protecting your assets and not actually getting LTC since you'll qualify for Medicaid when your assets are gone, then you should be able to cover the first three years of LTC out of pocket. The LTC scenarios that could really put you in financial straits are those lasting longer than three years, much longer.

Someone with modest assets can protect all of their assets from Medicaid by buying an affordable Long-Term Care Partnership Program (if they live in one of the 44 states that offer these programs.) This is a special type of long-term care insurance which has changed the rules regarding Medicaid spend-down and Medicaid estate recovery.

The beauty of the Partnership Program is that you only have to buy an amount of long-term care insurance that is equal to the amount of assets you want to protect from Medicaid. This makes the policies very affordable for those with more modest assets.


Disclaimer: I am a licensed insurance professional and am certified as a long-term care insurance specialist.
Do the partnership LTC policies include the hybrid plans offered by One America, Nationwide, Lincoln? How about whole life insurance with a living benefits rider?
No. Hybrid policies do NOT qualify as long-term care partnership policies.

But the insurance industry doesn't want you to know that. The industry, as a whole, would prefer everyone bought hybrids. There's a lot more profit in the hybrids than there is in traditional LTC insurance.
WoW2012 - I am not following this statement "Hybrid policies do NOT qualify as LTC partnership policies". I am looking at a hybrid plan with inflation protection (I have the ability to do a 1035 from an existing cash value LI policy) that looks to have a good LTCI. If you can clarify this "Do not qualify" on what it means, I would appreciate it. Thanks

Long-term care partnership policies are a special type of long-term care insurance. To understand the value of long-term care partnership policies you first have to understand how Medicaid works.

More than half of the people who need long-term care rely on Medicaid to pay for their care.
Medicaid will pay for your long-term care if you have income below certain limits and if you have assets below certain limits.
The limit amounts vary slightly from one state to the next.

In the best case scenario, in order to qualify for Medicaid-funded long-term care, the healthy spouse can keep about $127,000 of assets (not including home) and the other spouse (the one who needs care) can keep about $3,000 of assets.

If this hypothetical couple has $500,000 of countable assets, Medicaid would not pay for their care until they spend about $370,000 of their assets on the cost of care. This is called "Medicaid spend down". You spend down your countable assets until your assets are low enough for you to be able to qualify for Medicaid.

These rules change when someone owns the special type of long-term care insurance called a "Long-Term Care Partnership" policy.

Using the same example, if the spouse who needed care had a long-term care partnership policy that paid out $370,000 of benefits, then that spouse could qualify for Medicaid long-term care without having to spend down any of their assets. The long-term care partnership policy provides $1 of asset protection from Medicaid for every $1 of long-term care insurance benefits are paid.

Hybrid policies do NOT qualify as long-term care partnership policies. If your hybrid policy runs out of benefits, you will have to begin to use your own assets to pay for your care.
WoW2012
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Re: Why I don't think I should get long term care insurance right now

Post by WoW2012 »

willthrill81 wrote: Mon Jul 29, 2019 10:02 am
WoW2012 wrote: Mon Jul 29, 2019 12:07 am
willthrill81 wrote: Sun Jul 28, 2019 11:31 pm
WoW2012 wrote: Sun Jul 28, 2019 11:00 pm
willthrill81 wrote: Sun Jul 28, 2019 1:49 pm

If policies with those premiums and benefits were still available today, many here, including myself, would be all over them. $1 million of coverage for LTC for $40k was a great deal. Sadly, those policies haven't been available for a while and are very unlikely to ever be offered again.

At this point, the best that many of us could hope for is a LTC policy with a long exclusion period (e.g. 3 years) or a high 'deductible' (e.g. $300k). That would cover the truly catastrophic LTC events, and due to the rarity of such events, the policy would not be nearly as costly as traditional LTC insurance.

A 55-year old couple, in excellent health, could share $1.5 million in benefits for $1,500 per year per spouse. That's a pretty good deal.

Disclaimer: I am a licensed insurance professional and am certified as a long-term care insurance specialist.
1. What type of policy are you referring to (e.g. traditional LTCi, hybrid, etc.)?
2. Can the premiums increase and, if so, how is that determined or limited?
3. Do benefits change over time?
4. Are those premiums ongoing or limited in duration?

1. What type of policy are you referring to (e.g. traditional LTCi, hybrid, etc.)?
Traditional

2. Can the premiums increase and, if so, how is that determined or limited?
Rate increases are limited according to the Rate Stability Regulation (if the policy is purchased in one of the 41 states that has enacted the Rate Stability Regulation.)

3. Do benefits change over time?
No (unless the policyholder decides to decrease his/her benefits)

4. Are those premiums ongoing or limited in duration?
Those premiums are payable until the policyholder begins receiving benefits.
Thanks.

How much would the premiums be if the couple was age 65 or 70 when they took it out?
Very few people at the age of 70 are healthy enough to qualify for long-term care insurance.
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willthrill81
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Re: Why I don't think I should get long term care insurance right now

Post by willthrill81 »

WoW2012 wrote: Mon Jul 29, 2019 9:01 pm
willthrill81 wrote: Mon Jul 29, 2019 10:02 am
WoW2012 wrote: Mon Jul 29, 2019 12:07 am
willthrill81 wrote: Sun Jul 28, 2019 11:31 pm
WoW2012 wrote: Sun Jul 28, 2019 11:00 pm


A 55-year old couple, in excellent health, could share $1.5 million in benefits for $1,500 per year per spouse. That's a pretty good deal.

Disclaimer: I am a licensed insurance professional and am certified as a long-term care insurance specialist.
1. What type of policy are you referring to (e.g. traditional LTCi, hybrid, etc.)?
2. Can the premiums increase and, if so, how is that determined or limited?
3. Do benefits change over time?
4. Are those premiums ongoing or limited in duration?

1. What type of policy are you referring to (e.g. traditional LTCi, hybrid, etc.)?
Traditional

2. Can the premiums increase and, if so, how is that determined or limited?
Rate increases are limited according to the Rate Stability Regulation (if the policy is purchased in one of the 41 states that has enacted the Rate Stability Regulation.)

3. Do benefits change over time?
No (unless the policyholder decides to decrease his/her benefits)

4. Are those premiums ongoing or limited in duration?
Those premiums are payable until the policyholder begins receiving benefits.
Thanks.

How much would the premiums be if the couple was age 65 or 70 when they took it out?
Very few people at the age of 70 are healthy enough to qualify for long-term care insurance.
I wouldn't be interested in owning a LTC policy before at least age 65. According to the American Association for Long-term Care Insurance, which I linked to above, there's only a 4.5% likelihood of making any kind of LTC insurance claim before age 70. So an aged 55 couple would need to be prepared to pay $45k ($1.5k x 2 spouses x 15 years) in order to ensure that they will have access to LTC insurance at age 70 and beyond, while also covering the 4.5% likelihood of a LTC event between age 55 and 70.

Thank you for the information though. :beer
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings
WoW2012
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Re: Why I don't think I should get long term care insurance right now

Post by WoW2012 »

willthrill81 wrote: Mon Jul 29, 2019 9:53 pm

I wouldn't be interested in owning a LTC policy before at least age 65. According to the American Association for Long-term Care Insurance, which I linked to above, there's only a 4.5% likelihood of making any kind of LTC insurance claim before age 70. So an aged 55 couple would need to be prepared to pay $45k ($1.5k x 2 spouses x 15 years) in order to ensure that they will have access to LTC insurance at age 70 and beyond, while also covering the 4.5% likelihood of a LTC event between age 55 and 70.

Thank you for the information though. :beer

You are miss-quoting that statistic.
The AALTCi does NOT say that there is a 4.5% likelihood of making any kind of LTC insurance claim before age 70.
I suggest you read it again.
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willthrill81
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Re: Why I don't think I should get long term care insurance right now

Post by willthrill81 »

WoW2012 wrote: Mon Jul 29, 2019 10:32 pm
willthrill81 wrote: Mon Jul 29, 2019 9:53 pm

I wouldn't be interested in owning a LTC policy before at least age 65. According to the American Association for Long-term Care Insurance, which I linked to above, there's only a 4.5% likelihood of making any kind of LTC insurance claim before age 70. So an aged 55 couple would need to be prepared to pay $45k ($1.5k x 2 spouses x 15 years) in order to ensure that they will have access to LTC insurance at age 70 and beyond, while also covering the 4.5% likelihood of a LTC event between age 55 and 70.

Thank you for the information though. :beer

You are miss-quoting that statistic.
The AALTCi does NOT say that there is a 4.5% likelihood of making any kind of LTC insurance claim before age 70.
I suggest you read it again.
4.5% of those who make their first LTC claim are under age 70. Now it's true that there may be some selection bias with regard to those choosing to buy LTC insurance in the first place, but I don't see that changing the likelihood dramatically.
Image
http://www.aaltci.org/long-term-care-in ... s-2019.php
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings
WoW2012
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Re: Why I don't think I should get long term care insurance right now

Post by WoW2012 »

willthrill81 wrote: Mon Jul 29, 2019 10:35 pm
WoW2012 wrote: Mon Jul 29, 2019 10:32 pm
willthrill81 wrote: Mon Jul 29, 2019 9:53 pm

I wouldn't be interested in owning a LTC policy before at least age 65. According to the American Association for Long-term Care Insurance, which I linked to above, there's only a 4.5% likelihood of making any kind of LTC insurance claim before age 70. So an aged 55 couple would need to be prepared to pay $45k ($1.5k x 2 spouses x 15 years) in order to ensure that they will have access to LTC insurance at age 70 and beyond, while also covering the 4.5% likelihood of a LTC event between age 55 and 70.

Thank you for the information though. :beer

You are miss-quoting that statistic.
The AALTCi does NOT say that there is a 4.5% likelihood of making any kind of LTC insurance claim before age 70.
I suggest you read it again.
4.5% of those who make their first LTC claim are under age 70. Now it's true that there may be some selection bias with regard to those choosing to buy LTC insurance in the first place, but I don't see that changing the likelihood dramatically.
Image
http://www.aaltci.org/long-term-care-in ... s-2019.php
One of the largest long-term care insurers, UNUM, has stated that 40% of their LTCi claims were for policyholders under age 65.
40%!!!!!
Both statistics are correct.
Do you understand why both can be correct?
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willthrill81
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Re: Why I don't think I should get long term care insurance right now

Post by willthrill81 »

WoW2012 wrote: Mon Jul 29, 2019 10:39 pm
willthrill81 wrote: Mon Jul 29, 2019 10:35 pm
WoW2012 wrote: Mon Jul 29, 2019 10:32 pm
willthrill81 wrote: Mon Jul 29, 2019 9:53 pm

I wouldn't be interested in owning a LTC policy before at least age 65. According to the American Association for Long-term Care Insurance, which I linked to above, there's only a 4.5% likelihood of making any kind of LTC insurance claim before age 70. So an aged 55 couple would need to be prepared to pay $45k ($1.5k x 2 spouses x 15 years) in order to ensure that they will have access to LTC insurance at age 70 and beyond, while also covering the 4.5% likelihood of a LTC event between age 55 and 70.

Thank you for the information though. :beer

You are miss-quoting that statistic.
The AALTCi does NOT say that there is a 4.5% likelihood of making any kind of LTC insurance claim before age 70.
I suggest you read it again.
4.5% of those who make their first LTC claim are under age 70. Now it's true that there may be some selection bias with regard to those choosing to buy LTC insurance in the first place, but I don't see that changing the likelihood dramatically.
Image
http://www.aaltci.org/long-term-care-in ... s-2019.php
One of the largest long-term care insurers, UNUM, has stated that 40% of their LTCi claims were for policyholders under age 65.
40%!!!!!
Both statistics are correct.
Do you understand why both can be correct?
I find the 40% number to be far too high given all of the other data that I've seen, and UNUM has not sold individual LTC policies since 2009 and group policies since 2012, but if that number was accurate, please explain how it and the 4.5% number are correct. It would seem to be a stretch, but I can see how the claims amount could be higher for younger policyholders because if they need LTC, they're more likely to need it for a long time, whereas most 85 year olds don't need it for more than a year. But the amount of claims dollars and the number of claims are completely different metrics.
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings
rgs
Posts: 22
Joined: Sun Mar 24, 2019 7:30 pm

Re: Why I don't think I should get long term care insurance right now

Post by rgs »

WoW2012 wrote: Mon Jul 29, 2019 9:00 pm
rgs wrote: Mon Jul 29, 2019 7:46 pm
WoW2012 wrote: Wed Jul 24, 2019 12:06 pm
FBN2014 wrote: Wed Jul 24, 2019 11:26 am
WoW2012 wrote: Mon Jul 22, 2019 11:12 pm


Someone with modest assets can protect all of their assets from Medicaid by buying an affordable Long-Term Care Partnership Program (if they live in one of the 44 states that offer these programs.) This is a special type of long-term care insurance which has changed the rules regarding Medicaid spend-down and Medicaid estate recovery.

The beauty of the Partnership Program is that you only have to buy an amount of long-term care insurance that is equal to the amount of assets you want to protect from Medicaid. This makes the policies very affordable for those with more modest assets.


Disclaimer: I am a licensed insurance professional and am certified as a long-term care insurance specialist.
Do the partnership LTC policies include the hybrid plans offered by One America, Nationwide, Lincoln? How about whole life insurance with a living benefits rider?
No. Hybrid policies do NOT qualify as long-term care partnership policies.

But the insurance industry doesn't want you to know that. The industry, as a whole, would prefer everyone bought hybrids. There's a lot more profit in the hybrids than there is in traditional LTC insurance.
WoW2012 - I am not following this statement "Hybrid policies do NOT qualify as LTC partnership policies". I am looking at a hybrid plan with inflation protection (I have the ability to do a 1035 from an existing cash value LI policy) that looks to have a good LTCI. If you can clarify this "Do not qualify" on what it means, I would appreciate it. Thanks

Long-term care partnership policies are a special type of long-term care insurance. To understand the value of long-term care partnership policies you first have to understand how Medicaid works.

More than half of the people who need long-term care rely on Medicaid to pay for their care.
Medicaid will pay for your long-term care if you have income below certain limits and if you have assets below certain limits.
The limit amounts vary slightly from one state to the next.

In the best case scenario, in order to qualify for Medicaid-funded long-term care, the healthy spouse can keep about $127,000 of assets (not including home) and the other spouse (the one who needs care) can keep about $3,000 of assets.

If this hypothetical couple has $500,000 of countable assets, Medicaid would not pay for their care until they spend about $370,000 of their assets on the cost of care. This is called "Medicaid spend down". You spend down your countable assets until your assets are low enough for you to be able to qualify for Medicaid.

These rules change when someone owns the special type of long-term care insurance called a "Long-Term Care Partnership" policy.

Using the same example, if the spouse who needed care had a long-term care partnership policy that paid out $370,000 of benefits, then that spouse could qualify for Medicaid long-term care without having to spend down any of their assets. The long-term care partnership policy provides $1 of asset protection from Medicaid for every $1 of long-term care insurance benefits are paid.

Hybrid policies do NOT qualify as long-term care partnership policies. If your hybrid policy runs out of benefits, you will have to begin to use your own assets to pay for your care.
Very informative, thank you
smitcat
Posts: 6662
Joined: Mon Nov 07, 2016 10:51 am

Re: Why I don't think I should get long term care insurance right now

Post by smitcat »

willthrill81 wrote: Mon Jul 29, 2019 11:24 pm
WoW2012 wrote: Mon Jul 29, 2019 10:39 pm
willthrill81 wrote: Mon Jul 29, 2019 10:35 pm
WoW2012 wrote: Mon Jul 29, 2019 10:32 pm
willthrill81 wrote: Mon Jul 29, 2019 9:53 pm

I wouldn't be interested in owning a LTC policy before at least age 65. According to the American Association for Long-term Care Insurance, which I linked to above, there's only a 4.5% likelihood of making any kind of LTC insurance claim before age 70. So an aged 55 couple would need to be prepared to pay $45k ($1.5k x 2 spouses x 15 years) in order to ensure that they will have access to LTC insurance at age 70 and beyond, while also covering the 4.5% likelihood of a LTC event between age 55 and 70.

Thank you for the information though. :beer

You are miss-quoting that statistic.
The AALTCi does NOT say that there is a 4.5% likelihood of making any kind of LTC insurance claim before age 70.
I suggest you read it again.
4.5% of those who make their first LTC claim are under age 70. Now it's true that there may be some selection bias with regard to those choosing to buy LTC insurance in the first place, but I don't see that changing the likelihood dramatically.
Image
http://www.aaltci.org/long-term-care-in ... s-2019.php
One of the largest long-term care insurers, UNUM, has stated that 40% of their LTCi claims were for policyholders under age 65.
40%!!!!!
Both statistics are correct.
Do you understand why both can be correct?
I find the 40% number to be far too high given all of the other data that I've seen, and UNUM has not sold individual LTC policies since 2009 and group policies since 2012, but if that number was accurate, please explain how it and the 4.5% number are correct. It would seem to be a stretch, but I can see how the claims amount could be higher for younger policyholders because if they need LTC, they're more likely to need it for a long time, whereas most 85 year olds don't need it for more than a year. But the amount of claims dollars and the number of claims are completely different metrics.

I found a site that has more data - I have not read it as we have no reason to research this further now. Perhaps there is some statistics in this large pile of data which will help in one direction or another.
https://www.cdc.gov/nchs/data/series/sr ... 43-508.pdf
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