Long Term Care Insurance Premium Hikes

[duffer]

I've read all of the posts in this thread with great interest, as I'm a retired Financial & Estate planner. Part of my expertise was LTC insurance. There is some really good info above in the various posts, and there is some really bad/mis-information in some of the posts.

Not everybody needs LTC insurance. And it varies not just by financial position but also by state. Various states have different programs. There is no "1 template" that fits the entire country. LTC insurance is guaranteed renewable IF you pay your premiums. And the premiums are not guaranteed. But any price increase has to be approved by the individual state insurance commissioners for an age group for that state. And I know from being on that side of the desk the commissioners don't "rubber stamp" a price increase request. (oh, by the way, Life insurance premiums are not guaranteed either, depending on the type of policy you have)

Medical care of all types inflates about 2-3 times faster than the CPI index, so the cost of claims goes up substantially every year, hence at some point the insurance company has to raise their premiums, or they go out of business and then you're left with a policy that is only good for scrap paper.

LTC insurance is not cheap, but nursing home facility costs can range from $3000 per month, to $15,000 a month (or maybe even more now). NYC is higher than Des Moines. Mpls, MN is higher than Texarkana.

You have the option of choosing how long you want your LTC coverage to last. The national average for confinement time is less than 5 years. You hear about people spending 10 years in a nursing home because it is rare, not because it is normal.

A good advisor will step you thru all of the pros & cons of each type of policy. And they all have pros, and they all have cons. You have to decide which ones you can live with.

I always believed that LTC insurance was really important to protect the assets for the surviving (non-confined) spouse. $5-8,000 a month (after tax) going out of the check book can put a pretty good hole in the networth of a lot of people.

And you don't want the state to take care of you. I've seen that movie, and I know how it ends.

 

[ultrarunner]

The state stepping in is part of the plan or at least some say.

Several of mom's friends or acquaintances spent everything down, we'll documented and then the state steps in and the kids wash their hands...

 

[dmccarty]

I have no idea, how, or why, YouTube started showing me videos on death and dying but it did. I think I was watching some random Ted Talks and one on death and dying showed up that sounded interesting, so off I went. To watch the video that is, not to die.

Here is the video that started it all, so to speak,

Around 6:14 in the video there is a chart about the four ways people die.

1. Sudden Death
2. Terminal Illness
3. Organ Failure
4. Frailty.

Everyone wants 1, Sudden Death. Just get it over with but the reality is that most people take time to die from frailty and organ failure which can be very expensive. Terminal illness can be expensive as well but does not last as long.

We had a family member that lived for more than a decade in a nursing home. My family knew more about the home, residents, and staff, than the staff did, because we were there every day for years to watch over my family member.

I had a granny who swore she would never go to a nursing home. When it became time to go, she died. I swear she said to herself, she had had a good life. A hard, tough life to be sure but it was time to check out so she did. She was NOT going into a home. When the doctor said it was time to go to a home, my granny laughed and said we shall see. Well, granny got the last laugh and did not go to a home.

My granny had the right idea. Watching a family member living in a home is not good. The home was in a low cost of living area, which helped, but still not cheap and the money was almost gone by the time death arrived.

Later,
Dan