Is there a separate thread for LTC?
We recently talked to an advisor about getting LTC. We probably could fund this ourselves, but thought it might be good to get some insurance - peace of mind and potentially a conservative investment? There is a death benefit - so if you never end up using LTC, your heirs can still inherit a basic sum.
There have been discussions on this, though not sure if a specific LTC thread. My sense is the current policies are less generous than the ones sold long ago. Having a death benefit is interesting twist, combo of life & LTC insurance. A key thing to check is how costs may (or may not) increase as you age. Then last thing you want is to have a policy that becomes unaffordable in later years.
We have LTC policies taken through employer group discounts when we were younger/working (in our 50s - cheaper than when older but you pay more years). It gives us peace of mind, especially since it includes coverage of $100/day home care (vs $200 nursing home). We declined inflation coverage, which would have made it cost a lot more. Also has a max payout of about $216k (3 years nursing home) on each policy.
We do have LTC policies we have had for years - at the 10-year point we were given options to pay increased premiums or to keep a level premium with reduced benefits, and we chose that option. Every year or so, they send us an option to take a cash lump sum for each of our policies - no way, we keep paying our annual fee. To me, it is a way to have the payments of care applied when they are needed, but not to âoverpayâ on insurance.
The ânewâ LTC insurance policies are with a mix of insurance to have a death benefit if not used; with our policies no death benefit at all.
Son-in-lawâs parents are dragging their feet to selling their home and moving to the AL facility near their other son (and they would be 6 hoursâ drive from DD1 and their son). Now they live very distant to both.
As soon as SIL transitions out of the service during 2026 and into his FT career in the city they live in, we plan to move, probably in 2027 to be near them. We are still in go-go years, but that will change over time, and it will be good to be near family. The move will be a big endeavor for us - and once in a new house, will be adjustment time and new living patterns. I plan to revolve my extra time around special time with the grandkids and helping out DD1/SIL. DH will need to adjust his hobbies and friend network (we have other friends and family in the new state). Financially it is best to sell our home first before buying another, and so it will be coordinating the storage of what we want to keep for moving into new home.
We have been retired - 4 years for me and 5 years for DH - and have not spent down our nest egg. Our investments are keeping pace.
Key is to have enough to be able to live during the go-go and the slow-go years, and when you hit the no-go years, live comfortably, even if it is in skilled care on Medicaid. DH and I are the same ages (he is just 4 months older). One doesnât know if one will live to average life expectancy, or how much beyond.
To me, plan, but donât worry. Planning should take worry out of the mix. Keeping up with current information can help slightly adjust planning.
Many seniors find comfort in living frugally - and a small splurge can perhaps feel like a real luxury to them. Some people want to travel a lot in their go-go years before they hit slow-go years.
I know a couple that are about 7 years older than us. They have gone on 37 cruises. I believe they were used to having expensive vacations every year, and it is âtheir thingâ. I went on one cruise with a GF and DH has gone on none (I went with my GF because my DH says he would not like to go on one). One cruise was enough for me - I enjoyed it, but I do not repeat travel except to areas where family are in the US, and trips to Switzerland - and I donât see myself going again to Switzerland (Iâve been 5X, and the last time was for a month in 2016). I am a Swiss dual-citizen and stay with relatives and friends. I went on a US trip with a group from our local university OLLI program (Osher Lifelong Learning Institute) - we have a great organization here due to committed volunteers, and I will miss this group. We have a close cousin that, once they hit business success and also some inheritance, go on several cruises per year - it is the one time he can really relax, and they enjoy all the cruises have to offer.
Thought I would mention our LTC âcurrent coverage statementâ. They also gave information on reducing annual premiums with 3 scenarios: decrease lifetime maximum, increase elimination period, and decrease both lifetime maximum and increase elimination period. We purchased our policies 22 years ago when we were both 47. When the 10-year period of no premium increase passed, we chose to keep at our same premium level with reduced benefits. We still have excellent policies.
They also indicated the average care in our area (based on 2023 survey) - nursing home at $254/day for private room, assisted living $185/day (monthly cost divided by 30), and home care at $203/day (based on 8 hours of care per day at $25/hour). Our particular policy has facility benefit maximum up to $327/day, home care benefit maximum up to $2,292/week, lifetime maximum benefit unlimited, no elimination period, and has inflation protection (inflation rider automatically increases our policy coverage limits every year) - I believe 5%. We have to refer to our policy for covered facilities and service providers. I know relatives cannot be paid providers for example. We each pay a little over $1,000/year for our policies.
When they offer to buy back our policy, it is what our premiums and their investments have generated - cash value of our policy - it takes the risk off of them. As the years go by, there is increased likelihood of a policy being used for care. I believe the offer at the time was about $56,000 per policy. We are âinâ for the long haul.
The policies now are more expensive and less generous with benefits. Plus, the older you are, the higher the premiums. So if you are already retired, not the best time to newly purchase this, in my opinion.
We looked into this when we were much younger. Even then, the restrictions on some of the policies just didnât work. For example, one we researched (company now out of business) required that we reside in this state to access benefits. Since we didnât have a crystal ball, that just didnât work for us. And even then, the costs were pretty high compared to our then incomes.
So make sure you research things likeâŠexclusions, wait time until the benefits actually can be accessed, consideration of preexisting conditions, the policy definition of the criteria for this to be able to be used (IOW, you need to demonstrate you need it).
My parents had very generous LTC policies, and I âmanagedâ the process of applying for benefits and submitting for reimbursement on behalf of each of them.
Neither one ended up using anywhere near the amount they had paid in premiums, but if one had had a degenerative diagnosis (Parkinsonâs, for example), the policies would have paid off hugely.
The inflation/COLA rider is key; I would consider the policies almost useless without that feature. It doubled the premium cost when the policy was first written, but added a 5% compound to the benefit every year. By the time my mother died seven years ago, the benefit was almost $450 a day for five years. If she did not use the full daily benefit limit of $450 (or whatever it would have been by now), then the plan would have paid for more than five years.
I have helped a few friends review their parentsâ policies when they come up for renewal. All are facing significant rate increases and offers to reduce benefits for a lower rate of increase.
The hurdle to collect benefits can be significant as a claimant must be unable to complete two of the activities of daily living. There is often a period of deterioration before the claimant is completely unable to perform the ADLs, and that time period does not accumulate toward the usual 90 or 100 day elimination period.
Once the LTC carrier has approved the patient as eligible to receive benefits, the elimination period clock starts. During this time, one must provide documentation of paid assistance. In other words, hiring aides through an agency as opposed to hiring someone local/off the books.
The scenario I described is for the more typical deterioration of aging, as opposed to someone who suffers a stroke or another catastrophic diagnosis. Proving eligibility is far easier in those situations. The 90 or 100 day elimination period would still exist, and some policies will credit days spent in a rehab facility toward the elimination period.
To answer your question, I do not have LTC insurance. If anyone wrote a policy with say a one year elimination periodâwhere I would cover the first year of costsâI would buy that, but that product does not exist.
That is very good coverage for $1000/person/year, especially with the 5% inflation rider.
Is $327/day the current daily benefit limit?
I looked at LTCâs several years ago with our broker. The old plans were huge money losers for the insurers so the plans presented to us were not very attractive. Running scenarios, it seemed you would only âcome out aheadâ if you needed care pretty quickly and then lived for a long time. In normal scenarios, we would be better off self insuring and putting the LTC premiums into investments.
We have LTC policies purchased about 20 years ago. At the time of purchase, the premiums had never increased; increases were not allowed based solely on age; and the insurance company (Genworth) was rated in the âAâ category. It has a maximum payout which should cover about 4 years in a nursing home shared room (or longer for assisted living).
The year we turned 60, premiums started to skyrocket, and Genworthâs rating has fallen to the âCâ category.
The only saving grace is that we purchased the 5% inflation rider. That allows us to ratchet back the maximum benefit to keep premiums from rising too fast. We were advised by former FA to keep the policy since we could not replicate at our current age, but weâre still concerned that Genworth could fold in the future, and/or seek loopholes, as so many insurance companies do.
A family member knew of a benefit recipient (different insurance company) who did not meet the definition of inability to perform enough of the required ADLâs. The patient did not have the capacity to plan or cook for themselves, but since they could technically lift a spoon from plate to mouth, their LTC insurance company determined they could feed themselves!
âIs $327/day the current daily benefit limit?â
That was from the last letter (Oct 2025) with the details on choices to change/reduce our policy/reduce our cost.
I actually got licensed in our state to sell LTC policies, but I found so many people decided to âbuy inâ to communities instead of purchasing LTC insurance. Our policy is with CNA - who at the time of our purchase, sold LTC policies in 27 states. We purchased âthe gold standardâ policy at our ages of 47. Most people donât think about purchasing LTC insurance at that stage in their lives due to other things. CNA actually got out of LTC insurance and switched their focus to physician malpractice insurance â I guess they found that to be a better business focus for them. Our policies continue to be with CNA.
Another comment is that there are exceptions with the ADLs (Activities of Daily Living) - a big one is Dementia. Absolutely correct about âThe hurdle to collect benefits can be significantâŠâ Also, depending on the policy carrier what kind of documentation is needed for the start of the date for approving the patient to receive benefits âOnce the LTC carrier has approved the patient as eligible to receive benefits, the elimination period clock starts. During this time, one must provide documentation of paid assistance. In other words, hiring aides through an agency as opposed to hiring someone local/off the books.â
I personally had experience with Disability Insurance - and the carrier, a good company, just did not want to pay out. They finally did - their âin house MDâ versus my Medical Oncologist with rating me disabled on three categories - they even had a retired FBI agent come to âassessâ prior to my last discussion with claims person - I had a friend here (a retired government employee) during that agentâs visit. I understand his write up was to approve me for the disability. The day after I said âI guess I am going to have to contact an attorneyâ my disability payments were approved.
That is definitely a concern. If we never need LTC, I will not regret our expenditure⊠like other insurance, the hope is that you donât need it⊠have it for peace of mind. However if we do need it and canât qualify it will be disappointing.
I do know about how ADL list (Genworth needs at least two items of inability - The six standard Activities of Daily Living used by Genworth and other long-term care insurers include bathing, continence, dressing, eating, toileting, and transferring. And yes, as noted eating really does mean spoon-lifting, not meal prep etc). Folks considering a new policy definitely need to understand those aspects.
Insurance companies get very detailed on being able to reject claims on LTC insurance policy. One needs to understand fully how to put the âbest foot forwardâ when documenting towards claim approval.
Sometimes one needs to get very good professional documentation - perhaps from an OT. An OT might have particular assessments on âeatingâ which would not be easily cast off from insurance âsince they could technically lift a spoon from plate to mouthâ â I imagine there are measurement tools available which would perhaps have the individual not âpassâ on feeding themself.
Bathing: The ability to wash oneself, including showering or bathing.
Dressing: The ability to select and put on appropriate clothing.
Eating: The ability to feed oneself after food has been prepared.
Toileting: The ability to get to and from a toilet, use it correctly, and clean oneself afterwards.
Transferring: The ability to move from one surface to another, such as from a bed to a chair, or to a wheelchair.
Note: Sometimes âambulatingâ or âmobilityâ is included, which involves the ability to walk around, and âgroomingâ is listed as a separate activity, making a total of six basic ADLs. Toileting also includes âcontinence,â or the ability to control bladder and bowel function, which is sometimes listed as a separate ADL.
I agree with all of the comments above.
If you already have a policy, hold onto it, but brace yourself for future premium increases.
For those who do not have policiesâŠitâs a hard sell b/c of the current landscape of premium increases. Among many other underwriting assumptions, I imagine the LTC carriers did not price in the run-up in HHC aide costs since Covid. I was paying $25/hour seven years ago, and would have to pay$40/hour today. Add to that the increased demand for services as people are living longer than the carriers projected coupled with the decreased supply of HHC aides.
I know of one claimant who had benefits denied six to twelve months after initial approval. The denial was successfully appealed, but that required a fair bit of legwork.
My sense is that AL facilities & nursing homes know how to report claims so as to avoid appeals (compared to those obtaining care in own home). My motherâs carrier initiated a review after she had been in benefit for months, but she died before the review could occur.
How to pay for LTC needs is the greatest financial unknown of retirement planning.
My in laws purchased LTC policies in their late 50âs. The rates were pretty reasonable, although they did rise enough over the years that they chose to chose to reduce benefits. At the time FIL started collecting, he had benefits of 3 years at $100/day. He had Parkinsonâs for decades, but he wasnât able to begin using his LTC benefits until he was in his 90âs; he used it for less than three years. MIL also settled on $100/day, but she chose a longer time period - 6 years. She has used it for 3 years so far. Sheâs 98, and itâs possible she could live a couple more years. They actually would have been fine financially without the LTC. Rates are just so high now that H & I decided to self insure. Itâs a gamble, but the cost of the policies makes it a better bet for our situation.
Agree with the comment about âself-insuringâ with LTC - especially because you may never need or collect on a policy. Insurance companies try to put a product together that is a win-win for the insured and the company, but the actuaries do the number crunching for them, and it will always âfavorâ the insurance company IMHO, just like with gambling the house has the advantage.
IL and AL can be pricey; some choose to buy into a complex which has all the services, and they still pay a pretty hefty monthly rate - but I believe in many of these places 90% of the buy-in gets returned to beneficiaries. They screen the applicants carefully, so one needs to buy-in when they medically qualify.
Our SILâs parents look to going to an AL near their other son, and it is in a lower cost area - which is affordable to them. He has Parkinsonâs (gave up driving several years ago) and she has health issues - and they should have moved by now (they are living states away from their two sons) but are slow in accepting an open spot and getting their house ready to sell. DD1 fears something catastrophic will happen and it will take choices away from them prior to them moving. They count a lot on prayer and their church group.
We are the active/helping parents. DD1 and I are both BSNs (although I retired my license at renewal time after I retired from work at age 65). If/when we live near DD1/SIL/Gkids, DD1 will help us navigate any care we may need hopefully many years out. Until then, I make sure DH has his health issues taken care of, and he actually listens more than he used to and is following a healthy lifestyle.
I wonder if anyone has a rough âworking numberâ of how much to allocate for LTC? A financial advisor suggested we self-insure. Another advisor said she didnât have enough familiarity with that area to recommend a figure.
I understand itâs a gamble either way. You could need the money or not. You could work three more years to be extra-sure youâve got enough for LTC - and develop health issues that keep you from enjoying the early, active retirement years.
Given all those inherent and unresolvable uncertainties wondered if there was a ârough numberâ out there âŠ.?
Well, Dr. Google says LTC for 2 people who share a living space can be $140-225K per year. Much of it depends on level of care. I remember a couple to many years ago now a friend telling me her in-laws were in some kind of assisted living situation and the cost was 12K a month, and that may have been for only one of them.
Right now I have a fairly substantial pile of money that I hope continues to grow into enough by the time we need it, if we ever do.
Regarding LTC, Iâve read multiple places (including a search just now) that if you have a net worth over $2M self insurance is a viable option. LTC is supposedly a good idea for people with a NW between $500K and $2M.
Interesting - Iâve seen some general numbers thrown around but wasnât sure how much credence to give. I know folks here are very analytical and research oriented. Thank you!
Iâm kinda hoping something like this will reduce need for institutional care and/or super-pricey aidesâŠ. âŠ.
My fil spends about $15000/month on assisted living at the highest level of assistance. He has Medicare Advantage and Hosparus for his medical care which saves a lot of money. He chose the most expensive room in an expensive facility, pays a caregiver $700 for extra assistance (a few hours a day), and spends about $500 on extraneous things, so he could save money if he were more frugal. He lives in a town that has a lower cost of living, so I would expect it would be more in a big city.