Long Term Care Insurance Recommendations?

[Travelover]

Okay, Dokey. I guess I don't understand how cancer insurance is not "real" insurance and is a poor value. The only other type of insurance that you are guaranteed to use is life insurance if you keep it in force it is guaranteed to be used. With cancer insurance you have an almost 50 percent chance to use it while you are still alive if you are male. I don't agree that this is not a good value.
Cancer insurance premiums are very low, typically about a dollar a day. Do you know anyone in your family touched by cancer? Of course you do.

The premiums reflect the very low chance that the insurance company will actually pay out anything. They are not a charity - they are in it to make money, plus they have to give you your cut for peddling it.

Why would you buy health insurance when you may not ever need it. Why not just build up your emergency fund to take care of the everyday costs?. After all many people go decades without any major health costs, right?

I said buy real insurance to cover treatment that you could not afford. What you are peddling is what any normal emergency fund might cover. And if you don't use that money in the emergency fund, you still have it unlike with nickel and dime insurance.

An argument can be made that all insurance is not a good value. And if you do not use it, you will have lost money. This is all true, and yes all insurance purchases are based in fear. Fear of the unknown. If we knew the future with certainty, all insurance companies would go broke immediately.

Insurance should only be purchased to cover losses that you cannot cover with your emergency fund. Pushing insurance to cover incidentals like hotel rooms and gas money is just playing to the foolish desire to get something for nothing.

 

[k0ua]

The premiums reflect the very low chance that the insurance company will actually pay out anything. They are not a charity - they are in it to make money, plus they have to give you your cut for peddling it.

I said buy real insurance to cover treatment that you could not afford. What you are peddling is what any normal emergency fund might cover. And if you don't use that money in the emergency fund, you still have it unlike with nickel and dime insurance.
Insurance should only be purchased to cover losses that you cannot cover with your emergency fund. Pushing insurance to cover incidentals like hotel rooms and gas money is just playing to the foolish desire to get something for nothing.

Please let me know how many thousands of dollars a person should have in an emergency fund?

 

[Parkanzky]

Okay, Dokey. I guess I don't understand how cancer insurance is not "real" insurance and is a poor value. The only other type of insurance that you are guaranteed to use is life insurance if you keep it in force it is guaranteed to be used. With cancer insurance you have an almost 50 percent chance to use it while you are still alive if you are male. I don't agree that this is not a good value.
Cancer insurance premiums are very low, typically about a dollar a day. Do you know anyone in your family touched by cancer? Of course you do. Why would you buy health insurance when you may not ever need it. Why not just build up your emergency fund to take care of the everyday costs?. After all many people go decades without any major health costs, right?
An argument can be made that all insurance is not a good value. And if you do not use it, you will have lost money. This is all true, and yes all insurance purchases are based in fear. Fear of the unknown. If we knew the future with certainty, all insurance companies would go broke immediately.

You're right. Any insurance may or may not be a good value. But the considerations aren't as simple as "What is the chance that I'll use it?"

The question isn't what the premiums are. It's what the premiums are vs. what the benefit will be if it's ever needed. Transportation, hotel rooms and meals? That's peanuts. If I just take your ~$1/day and invest $30/mo in savings instead, then I will have over $12k in twenty years. Seems like plenty to pay for "transportation, meals and rooms" for a loved one. I looked up Aflac's cancer insurance policies to see what you were talking about. They pay a lump sum payment of $2500-$10,000. Not a great return on your $30/mo investment, even if you know you'll need it.

You try to draw a parallel with conventional health insurance. But traditional health insurance is providing orders of magnitude more coverage than cancer insurance. So while I will pay out a huge amount of money in health care premiums over my lifetime, I need to do that because I can't afford to save the cost of a catastrophic medical expense.

 

[Travelover]

Please let me know how many thousands of dollars a person should have in an emergency fund?

About 6 months living expenses would be prudent. A really, really good way to build up that fund is to quit buying insurance you don't need like extended warranties, low deductible car and home insurance, cancer insurance, airline flight insurance and any other kind of insurance that covers small risks.

 

[Parkanzky]

Please let me know how many thousands of dollars a person should have in an emergency fund?

The typical financial advisor's response would be ~3-6 months of living expenses for someone with a "regular" job, and more for people that are self-employed, consultants, etc.

Sound impossible? $60/month invested extremely conservatively (5% return) for twenty years will put $25k into the bank.

If you're living within your means, you should be putting at least 10% of your take-home away every month. That means you'll have three months worth of your take-home pay in the bank (which should be more than three months of living expenses, since you aren't spending every dime you make) in less than three years. Less if you get a bonus or a tax refund or some other windfall and don't just use it as an excuse to blow more money. When people react as though that's ridiculous or impossible, it gives you a pretty good idea of how we ended up with the low savings rates and high consumer debt levels that are becoming the norm.

Obviously, a financial disaster early on can wreck these plans. But for the vast majority, it will allow them to build a solid financial foundation and set them up for a comfortable life.

 

[k0ua]

About 6 months living expenses would be prudent. A really, really good way to build up that fund is to quit buying insurance you don't need like extended warranties, low deductible car and home insurance, cancer insurance, airline flight insurance and any other kind of insurance that covers small risks.

As a family touched by cancer, and having received the benefit of a cancer policy, I am here to tell you, it was no small risk. You are welcome to do what ever you like. As for Aflac, they are not the only cancer insurer out there, and many will pay from 20,000 to 75,000 dollars upon diagnosis. You trivialize the peripheral costs, as "peanuts". Don't forget you will not be working, yet the house payment goes on, the car payment goes on. the utilities go on even though you may be laying in a bed in some far away city. So feel free to pooh pooh, cancer insurance all you want, as you draw a parallel to "toe fungus insurance". OK, I just hope you never are struck with the scourge of cancer. Many of us will be.

 

[Parkanzky]

As a family touched by cancer, and having received the benefit of a cancer policy, I am here to tell you, it was no small risk. You are welcome to do what ever you like. As for Aflac, they are not the only cancer insurer out there, and many will pay from 20,000 to 75,000 dollars upon diagnosis. You trivialize the peripheral costs, as "peanuts". Don't forget you will not be working, yet the house payment goes on, the car payment goes on. the utilities go on even though you may be laying in a bed in some far away city. So feel free to pooh pooh, cancer insurance all you want, as you draw a parallel to "toe fungus insurance". OK, I just hope you never are struck with the scourge of cancer. Many of us will be.

I've lost more people to cancer than I care to think about. I still contend that $20k is peanuts. About how much does a family policy with a $50k lump-sum payout cost?

I still don't fully understand what that $50k is for? Proper medical insurance will pay for the treatment. You're right that I won't be working. But I'll be collecting long-term disability. Even if I'm not, my house payment and utilities will be payed by my savings. And car payment? I don't recommend having one of those unless it's because you're making more money on that cash in your investments. But regardless, an emergency fund would pay all those expenses for at least 3-6 months.
Do I need $50k to fly my entire family back and forth to the treatment center for visits?

 

[Travelover]

...... OK, I just hope you never are struck with the scourge of cancer. Many of us will be.

I hope I'm not either, but I am in a position to pay for incidental costs like those you describe because I have not fallen for emotional pitches from insurance salesmen. These type of policies provide poor value given the premium charged.

 

[RedNeckGeek]

OP here.

A few years ago a coworker was diagnosed with Hodgkin's lymphoma. He ended up spending 6 months at an out-of-state hospital that specialized in the treatment of various cancers. We have the same insurance, and I know his maximum out of pocket for a year is about $4K for the medical bills. The hospital had an apartment building to accommodate his wife and himself while he was undergoing treatment. I can't imagine that costing more than another $10K. They used public transit to run most errands, and rented a car once in a while for special trips. Their home sat vacant while they were gone, so utility use would be minimal, savings that offset those used at the apartment. Eating and the rest is a wash, as that has to be done regardless. He's made a complete recovery so far, and his prognosis is excellent. If something like that happens to me, I'll do the same.

But my worry is that once I reach Medicare age, my private insurance ends. If I understand correctly, that means I'll be paying 20% of the treatment cost, with no out of pocket maximum. That scares the H*** out of me, as a single hospital stay can run into several hundred thousand dollars. Even though I have substantial financial assets, I depend on the proceeds from those investments to make ends meet, and if the principle is consumed to pay medical bills I'll be shopping for dog food at Costco hoping I can save enough to pay my property taxes. If for some reason (like a stroke) I end up needing long term care, that's not covered at all by Medicare, and after several years I'd again be looking at a canine diet.

Here we are four pages into this thread, and only one response listed an insurance company or resources to find one. That's the kind of real guidance I was fishing for in my original post, so if you have experience to share, good or bad, I'd love to hear it.

Thanks in advance...

 

[k0ua]

OP here.

A few years ago a coworker was diagnosed with Hodgkin's lymphoma. He ended up spending 6 months at an out-of-state hospital that specialized in the treatment of various cancers. We have the same insurance, and I know his maximum out of pocket for a year is about $4K for the medical bills. The hospital had an apartment building to accommodate his wife and himself while he was undergoing treatment. I can't imagine that costing more than another $10K. They used public transit to run most errands, and rented a car once in a while for special trips. Their home sat vacant while they were gone, so utility use would be minimal, savings that offset those used at the apartment. Eating and the rest is a wash, as that has to be done regardless. He's made a complete recovery so far, and his prognosis is excellent. If something like that happens to me, I'll do the same.

But my worry is that once I reach Medicare age, my private insurance ends. If I understand correctly, that means I'll be paying 20% of the treatment cost, with no out of pocket maximum. That scares the H*** out of me, as a single hospital stay can run into several hundred thousand dollars. Even though I have substantial financial assets, I depend on the proceeds from those investments to make ends meet, and if the principle is consumed to pay medical bills I'll be shopping for dog food at Costco hoping I can save enough to pay my property taxes. If for some reason (like a stroke) I end up needing long term care, that's not covered at all by Medicare, and after several years I'd again be looking at a canine diet.

Here we are four pages into this thread, and only one response listed an insurance company or resources to find one. That's the kind of real guidance I was fishing for in my original post, so if you have experience to share, good or bad, I'd love to hear it.

Thanks in advance...

Yes medicare only pays 80 percent of Part B (medical)medicare approved charges and then there is your Part A (Hospitalization) deductible of $1216 per benefit period (not annual, but benefit period) . And of course it doesnt pay for the first 3 pints of blood, etc.. There are hundreds of rules. So this is why people buy Medicare supplements. The top ones are the Plan F, the Plan G, and Physicians Mutuals Innovative F,. There is also a High Deductible F if you want to take on $2180 of deductible risk yourself, to save monthly premium.

The plan F is the Cadillac plan that picks up everything, the G is really the same with the exception of the $147 part B annual deductible, but you make that up in reduced premium pretty quick. There is also a Plan N if you are used to the idea of a $20 copay for each doctor visit and $50 for each ER visit, and it also does not cover Medicare excess charge for providers that do not accept Medicare assignment. Those providers are allow to charge up to 15% above Medicare approved charges and bill you the difference. All of the F and G plans will pick that up. Plan N also does not pay for charges incurred during foreign travel. However I suggest you simply buy travel insurance, as it is dirt cheap and a heck of a lot easier than trying to coordinate with medicare. Now you can believe what I am telling you as an Insurance professional, or you can believe someone else on here that don't even know what they are talking about.. The choice is yours.