<p>Just went though this with my dad, so yes, its a hot topic in our house. We were looking at the USAA Hancock policy, but a friend is pushing us to look at her product- Berkshire (Guardian). But it looks like they may stop selling it at the end of the year. Anyone have experience with Berkshire?</p>
<p>We purchased a Genworth LTC policy through USAA a couple of months ago. Although the USAA financial advisor was pushing a shared policy, we chose individual coverage based upon the statistics she provided about the average length of stay by men and by women. We added inflation protection and other “upgrades.” </p>
<p>Skyhook, what impressed me most about this policy is that it covers at-home care rendered by someone of our choosing-- could be a friend, neighbor or relation, and not necessarily a trained healthcare aide. It also covers the cost of training that individual and provides for respite care for them.</p>
<p>This decision was weighing heavily upon me; since signing the policy I haven’t given it another thought.</p>
<p>re: going outside the system</p>
<p>I wouldn’t bet on saving a huge amount. My MIL has (and needs) caregivers about 14 hours a day most of the time. While the least expensive agency person runs $17/hour, that’s a final cost. My MIL pays $11-$16.50 per hour in gross wages, but then is also responsible for paying the employer share of social security and medicare taxes, workman’s comp (and injuries are not uncommon amongst home health workers, particularly those that have some lifting responsibilities), unemployment taxes,… The most expensive aide is the one who is the primary day aide who also has a clean driver’s license and who can take her to doctors appointments or go do her shopping or make a run to the bank. That aide speaks very good English, and that’s also important. The evening/weekend aides don’t have/need as much in the way of qualifications, and neither of them speak English as fluently. We hire people directly because she’s able to get people she’s happier with that way, and then we use the agency for supplemental hours, such as when someone goes on vacation or gets sick.</p>
<p>This has been going on for more than seven years now, and without LTC coverage that pays about half the costs, she’d have been long since forced into a nursing home since she’s not medically qualified for assisted living. It is still expensive, but the LTC coverage makes a tremendous difference.</p>
<p>The policies my husband and I have include a provision that if neither of us collects anything on the policy for the first ten years it is in place, and then one of us dies, the other’s policy remains premium-free for the remainder of that person’s life. That looks like a very good benefit, though I certainly hope neither of us dies anytime soon. (We’re not quite at the ten year mark anyway, but definitely just a couple years away.)</p>
<p>^^^We have that provision as well.</p>
<p>I purchased LTC but only for 5 years max. If that is not enough then I will have to pay out of pocket. It’s not great but at least it’s something before I develop any health problem and become uninsurable.</p>
<p>This a growing issue–in HI, aides are often $25+/hr, if you can find & retain them. It’s really tough, plus you have to provide w/c and other things, especially if you have them >20 hrs/wk in HI (including health insurance). Lots of our folks friends & family are dealing with these issues now. Do not believe most have any insurance, but do have friends & family nearby. Fortunately, several have family members who are not pursuing their careers so they can be caregivers.</p>
<p>I personally don’t deal with LTC insurance however we do have some people in my office that do. I’ve gotten to listen to a couple of their phone calls over the years and it’s very interesting. If you are interested in it I would definitely suggest talking to either an agent or a financial adviser to help you run the numbers. I know most places won’t even take you if you don’t have x amount of assets to protect. They have all sorts of quirky benefits that you can add on so it’s great to sit down with someone (or call someone) who can walk you through all the options. The phone calls that I have heard start with the agent giving you some figures about actual costs of LTC. They then go step by step through building a policy with you… you pick your elimination periods, payments per day, random other benefits, etc and they adjust the cost for you as they are doing it.</p>
<p>The Genworth policy that our office has sold either functions as LTC or life insurance. For instance a man put $100k in lump sum premium into his as part of his retirement planning, he will either get up to $130/day for about 4 years…or can take less over a longer period. If he never uses it, they will pay $125k in death benefit. If he uses part of it, for a part time need like surgical recovery, etc., they will pay the $125k minus anything already paid out as LTC benefit. In his mind, he cannot lose.</p>
<p>somemom- That sounds like the annuity or whole life thing that Lincoln National sells. My DH his very averse to annutities and says that there is a huge up front cost to those policies. Is that true?</p>
<p>bump… this is a timely topic for many CC parents. I’m waiting for info packet from the LTC group policy offered through work. That will be my baseline as I compare other plans.</p>
<p>Just got my annuity statements for the quarter. </p>
<p>You really need to investigate the newer annuities with guaranteed withdrawals, no need to annuitize, guaranteed increases. The upfront cost is the commission (like B shares) and annual fees.</p>
<p>The crashes of 2000, 2001, 2009 have convinced me that the markets are too volatile for our retirement funds; If one, died during those crashes, the survivor would be short even with LI.</p>
<p>I prefer to transfer some of the risk to another party. We still have selfdirected market securities in IRAs and 401.</p>
<p>My MIL died 5 yr ago from Alzheimer’s. She entered the hospital on Sept 10, 2001. We had Dad bring her to the ER after she bit him when he was trying to get her to use the toilet.</p>
<p>He had been dealing with her AD for several years on his own, before that.</p>
<p>MIL was one of 4 sibs & the only one to develop AD. However her brother died from a heart attack before he was old enough for it. Her father also had AD and spent his last years in a state mental hosp (what was done at the time).</p>
<p>MIL used Medicaid for her costs–FIL rents home & has few assets, recvs Soc Sec.</p>
<p>So, when DH’s employer offered a LTC policy, we bit. He had originally signed up for the least level of care (there are three price ranges/day cost offered). We went to an online calculator and recently chose the highest one for our state, and at renewal time signed up for that. We got a break because he had already been enrolled. </p>
<p>This policy offers an inflation protection, and it also reimburses you if you die without using the care (accident, disease not needing the care). We signed up for both of us but we chose the higher level of care for him. It is not cheap but after looking at the family history we thought it the better way to go.</p>
<p>My family hist runs to heart attacks & cancer—no AD, ever, in any ancestor that I know of.</p>
<p>The next few months for USA budget is going to be exciting.
Medicare/Medicaid/Health Insurance/SS/Taxes are going to be on the line.
May not be pretty.</p>
<p>Bumping this up for those who were discussing it-- we got a Genworth plan, but it was no longer offered by USAA. Actually got it through DH’s alumni organization. We both qualified as preferred (after they initially tried to decline DH!) That took a bit of a “conversation”.</p>
<p>Congrats, jym. My MIL is still going pretty strong mentally, but her body has not done nearly so well. Her aides are currently running $82,000 a year, and it is her LTC policy that is helping make that possible by covering about a third of the costs. Otherwise she’d have to go into a nursing home, which she is trying so hard to avoid. Unfortunately she did not get an inflation rider, so the policy pays a fixed amount each month. </p>
<p>We’ve got our policies set up, and it is money I am happy to pay.</p>
<p>I am 55. I just purchased LTC via a Lincoln MoneyGuard policy. It is a combination LTC and life insurance/annunity. It is single premium, but you can now pay it over 5-10 years, which is a new option. You pay a premium. At any time after the first two years, if you have a pressing need and need the money, you get it back. No interest earned, but you get your principal back. If you die and never use a dime of it, your heirs get back somewhere between 150-200% of the premium you paid as a death benefit (tax free). The younger you buy the greater the death benefit. If you need to use the policy, your age at purchase and premium amount provides a certain amount per month for so many months. It covers home care by anyone but a family member, etc. </p>
<p>Lets just say you buy $50,000. You can pay $50,000 with money from your retirement account in some instances, from money in CD’s or savings. You can now also pay over 10 years at $5000 a year. Assume you have paid the $50,000 and you want to cash out. You get your $50,000 back. Assume you are 55 and paid $50,000 and you don’t use it. Your heirs will have a death benefit of $130,000. If you need it you will have a benefit of $350,000 in long term care benefits paid out as a maximum of so much a month for so many months. If you only use a portion of the LTC benefits, there is still a death benefit. </p>
<p>You can buy $25,000 now, up front or over time. You can add another $25,000 in the future. You can buy $100,000 (yeah right). You decide how much of a premium to pay. They run the numbers and tell you how much the premium will provide you in LTC (and death benefits). </p>
<p>I could not bring myself to pay a monthly premium, subject to premium increases, with the idea I might never use it. Or that I could pay in premiums, decide not to continue the premiums, then loose all that paid in and then one day need it. </p>
<p>This made sense to me. Everyone is different. This costs more up front. But if you have money in CD’s, not making much for you, it may buy more in LTC coverage than that CD will buy in long term expenses if you are going to “self insure.” </p>
<p>It can be an even better deal for a couple, with discounts and more benefits to the second spouse if the first does not use it. In our case my husband is 10 years older and not insurable. He is also more adamant about not accepting any sort of care that will prolong his life if there will not be quality. Me, I want to be around forever…</p>
<p>Wow, $82k annually for aides? I assume that is 24/7 care at $225/day. Ouch! My MILs aide is about $135/day, but not 24/7</p>
<p>MY dad has 24/7 befause he wanted to stay in his house. We only accessed his LTC the last 2 years of his life. It helped a lot but we still had to refi his house to let him stay there.</p>
<p>We didnt go the combo insurance/annuity route because we’d have to have purchased two separate ones, and my DH didnt want to go that route. We picked a higher level plan (I forget the name Priviledged Choice 3 or something?)</p>
<p>jym, how old are you? I have heard that 60 is the optimal time to purchase, and I wondered how much it costs (typically) & at what age.</p>
<p>We have a high deductibe HSA health insurance plan & I don’t actually take the reimbursements … I am saving the money for LTC payments. We are 51 & 52 - will be 52 & 53 in a couple months - so are really thinking about all of this these days.</p>
<p>I am just catching this thread for the first time. I am an elder law attorney, and a big part of my practice is teaching people about the various ways that people pay for long term care, including LTCI, Medicaid, and VA benefits. LTCI can be an amazing thing. It can let someone remain at home forever, and can help a family maximize resources to purchase the best possible care for someone with long term care needs. I encourage all of my clients who have assets to protect and who can afford the premiums to take the time to explore this coverage. I’ve read all of your responses, and can’t respond to all, but as general points, I want to share:</p>
<ol>
<li><p>As some of the more recent posters have noted, there are all kinds of new hybrid policies that have been created over the past few years to address the concerns that people have had about dumping a bunch of premium money into a product that they may never end up using (thereby, in traditional policies, losing their premium investment). These are not annuities. Kind of a “have your cake and eat it too” concept. But there are pros and cons to these products which can impact eligibility for Medicaid and VA benefits.</p></li>
<li><p>In the past year+, several of the largest LTCI insurers have exited the market, and many have for the first time sought premium increases. This is a business in flux.</p></li>
<li><p>At the same time, the Medicaid rules have also been in flux. They change all the time, and our job is to keep up on what are the rules du jour. Some states already reward their citizens for buying LTCI by offering various asset protection features, and as state (and fed) budgets continue to tighten, more states will likely offer “partnership” scenarios. These features may/may not factor into a decision about what is best policy to buy.</p></li>
<li><p>LTCI is a strenuously medically underwritten product because once the company agrees to insure you, they own you even if you stroke out the next day. So, they want to be sure you are not going to stroke out the next day. But each company has its own medical underwriting criteria. Company A might not want you because of your condition/history/meds, etc., but Company B might welcome you with open arms. You do not, however, want to get denied by Company A before you apply to Company B because a denial of coverage is going to hurt your ability to get insured by someone else. If you have ANY medical issues, you need to work with a LTCI advisor who knows the ins and outs of the medical criteria of the different companies who can help pick the best (or submit multiple apps at the same time), rather than working with a captive agent. </p></li>
<li><p>You want to buy the most coverage you may need and can afford for two reasons. One, the younger you are when you jump in, the lower your premiums will be … forever. And two, the only way you can increase your coverage once you have signed up is to go through more medical underwriting, and every MD visit you have in your life is one visit closer to the one that makes you uninsurable.</p></li>
<li><p>Buying – or not buying – LTCI is really just one piece of an overall financial and long term care plan. You can do it yourself, but you are really better served by working with a financial advisor who is really knowledgable about the product (not just someone who sells it along with a million other products), and with an elder law attorney who can counsel you about all of the planning options that may be available given your particular circumstances. </p></li>
<li><p>Finally, Medicaid eligibility in every state is a completely different undertaking for a single person v. a married person. Some of the things about Medicaid that have been posted in this thread are not legally correct (regardless of state … it all starts with federal law). If I had a dime for every client who has come in and shared with me things they thought they knew to be true about Medicaid because of what they believe was the story with their friend/neighbor/relative’s mother/father/sister, I would be headlining on the “how do you tell is you are a millionaire?” thread from a few weeks ago. Every situation and family is different. Whenever you hear a Medicaid or nursing home story, remember the kid game of “Telephone” and how things often get lost in translation. </p></li>
<li><p>As great as it can be, LTCI is not for everyone. And that’s OK, because there are a bunch of other planning opportunities available to plan for future care needs.</p></li>
</ol>