who's your ltc provider?

powertradeOctober 5, 2013

Are they good? My mom's considering on buying one since Gramps died two years ago because of Alzheimer's. Do you have any suggestion?

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robyndowning

My 90 year-old father has Penn Treaty but I wouldn't suggest them because they are having financial problems. Four years ago my sister made the decision, for my dad, to accept a flat rate from them since the monthly premium was too high. All the deductibles still apply and then they pay a flat rate with the balance owed by my dad. Many of them have restrictions that state you have to purchase by 75 years-old or they won't cover you.

I have read that John Hancock and Genworth are good but you would have to decide what plan you want and if you can afford it. They have different deductibles so that factors in. I see that State Farm offers it as well. They tend to have pricey policies (my parents had homeowners and coverage for their 2 apartment buildings for 35 years) and last year I helped change the provider and saved quite a bit.

If your mom was employed through the state, a school district or other union job then that may be an avenue to look into. I am checking out what the California Teacher's Association has and if my dad could get one of their policies.

    Bookmark   October 5, 2013 at 6:33AM
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robyndowning

My 90 year-old father has Penn Treaty but I wouldn't suggest them because they are having financial problems. Four years ago my sister made the decision, for my dad, to accept a flat rate from them since the monthly premium was too high. All the deductibles still apply and then they pay a flat rate with the balance owed by my dad. Many of them have restrictions that state you have to purchase by 75 years-old or they won't cover you.

I have read that John Hancock and Genworth are good but you would have to decide what plan you want and if you can afford it. They have different deductibles so that factors in. I see that State Farm offers it as well. They tend to have pricey policies (my parents had homeowners and coverage for their 2 apartment buildings for 35 years) and last year I helped change the provider and saved quite a bit.

If your mom was employed through the state, a school district or other union job then that may be an avenue to look into. I am checking out what the California Teacher's Association has and if my dad could get one of their policies.

    Bookmark   October 5, 2013 at 6:34AM
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emma

Why would she want that. Her spouse has passed. I don't have it for the same reason. The money is there to pay my way if I need a care home and when it is gone I will go on medicaid. If you kids want the inheritance you need to pay for her long term care insurance.

This post was edited by EmmaR on Sat, Oct 5, 13 at 14:19

    Bookmark   October 5, 2013 at 2:18PM
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maifleur01

I agree with EmmaR. Do not use your income for ltc if you are single, widow or divorced. I feel it is better to use what you have to provide your own care then go on Medicaid rather than provide a inheritance or have relatives pay for your care.

    Bookmark   October 5, 2013 at 10:06PM
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jkom51

Anyone who says "go on Medicaid" must live in a state that has vastly better Medicaid-only facilities than what we have in Northern CA. We have investigated 7 facilities for my MIL not including the Medicaid-only facilities in our urban area. I wouldn't put a dog in the Medicaid-only facilities we've seen, let alone my MIL.

Out here a lot of Asst. Living/Seniorcare facilities are changing their policies, as well. At one time all of them were willing to shift costs to Medicaid and keep residents in nursing care (also called specialty care) units. However, we found many of the for-profit places are no longer willing to do this. You run out of money, then out you go! The non-profits haven't changed yet, thankfully.

Although we have LTC policies, our carrier is guaranteed by our state employees pension fund - the carrier literally cannot get out of the market. They can and have raised rates, but even that has to be negotiated with the pension fund, which has enormous financial clout, being one of the biggest in the US.

I am a strong believer in LTC insurance....however, I no longer recommend it because I don't think most people are able to easily afford it. The strongest carriers, such as Genworth, Lincoln Benefit, and Northwestern Mutual, are among the most expensive. You need that tremendous financial stability to trust the carrier will still be around when you are ready to make a claim, and going with a lesser company is a lot riskier.

More importantly, underwriting for LTC is VERY TIGHT. That means most people, by the time they are fearful enough to consider buying it, simply are not healthy enough to be eligible for the best (Premium level) rates.

I was a Standard rating (that's a +1 rate) when I was 48 yrs old and bought my policy; I would easily be 2x Standard now at age 62, being higher risk. My spouse, who was Premium level at age 46, suffered a haemorrhagic stroke at 50 and although 90% recovered, would probably get walloped with a 3x rating or worse.

Also, we have very comprehensive policies. Many carriers do not even offer the unlimited benefit period which we currently have on our policies.

So unless your mom is relatively young (all carriers refuse to write LTC on anyone over age 79 anyway, btw) and VERY VERY HEALTHY, it's not likely she's going to be able to afford anything more than a fairly limited policy.

By limited, I mean a $100/daily benefit, 5-7 year duration, 3-6 month elimination period (the period that is self-insured, before benefits will start). Although the cost for such a policy is modest, the policy is also useless without two options: full daily benefit home healthcare, and 5% compounded (NOT simple) inflation. Those two options will almost exactly double the annual premium; but any policy without them is a waste of money.

Why? Because home healthcare is the fastest growing segment of healthcare costs, and if you want to "stay in your home", it's essential. And the inflation rider is also essential, because there is only one direction labor and healthcare costs are going, and that's upwards. It's just a question of how far and how fast. Consider the price of bread, or a new car - the same thing happens to the cost of eldercare on an individual, customized basis.

After all this, if you still want to investigate LTC, find an LTC broker. Insurance agents specialize just like attorneys and car repairmen, and a good broker can help you compare policies from different companies to determine if the cost is worth the risk mitigation.

For most people, I'm sad to say, they've missed the boat. The LTC market was a lot more open and competitive even ten years ago, but it's tightened up dramatically in the last three years.

The saddest thing of all is that for a short while, soon after buying our policies, I could have signed up all my older siblings and their spouses. Every one of them turned us down, saying the usual - "Oh, it's too expensive," and "We'll cross that bridge when we come to it."

Now, 15 yrs later as they face Medicare and realize it doesn't pay for LTC, they're panicked, regretful and envious. But it's too late; that program closed due to lack of response and we can't help them.

    Bookmark   October 6, 2013 at 5:52PM
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CA Kate

I agree that when you need Long Term Insurance it will be too expensive to buy. We bought ours when in our 50s and now it is paying off big time. UNUM pays $205 per day for as many in-home caregivers as we have. (That's per day NOT per caregiver). We're up to two shifts, one 8 hours and night shift is 12. I have to pay the extra, but I'm still most grateful to have the money they give. I probably wouldn't be getting the help I need.... just because I couldn't have afforded it, and my health deteriorating from the stress and lack of sleep.

UNUM has been great so far, and the amount they pay is related to how professional the care, and institutional residence would be a different pay-rate entirely.

FYI: the amount we've received in the last year already is almost more than we've paid out in premiums.

My recommendation is to buy it when you're healthy in your 50s and hopefully can better afford it.

    Bookmark   October 6, 2013 at 7:18PM
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maifleur01

I have never been in a Medicaid only facility. Most of the homes I have visited have several rooms for Medicaid. They are more spartan than the other rooms but just as well kept. They lack tv and phone. Perhaps it is because most of the homes here are on the smaller size.

    Bookmark   October 6, 2013 at 8:55PM
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emma

We don't have medicaid only care homes here. Some don't accept medicaid, just like some doctors don't accept medicare patients, but there are very few of those. They are private care homes, the average people can't afford their prices. I had to put my husband in a care home after caring for him for 4 years. None of the homes i looked at furnished TVs and other amenities like that. The have to bring their own and pay for a phone or cable TV. He had to share a room also. A private room costs half again or more in any home I looked at. If I ever go in I can get a private room for as long as my money last, then I would have to move into a shared room.

    Bookmark   October 7, 2013 at 9:45AM
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