But now, I'm hearing a lot of insurance companies are getting out of the LTC insurance business, (mine included, though they still have to honor my policy) b/c it's more expensive for them then they expected. So I don't know if this type of policy will be around for long.
Last edited by FigureSpins; 01-28-2011 at 02:25 PM.
Also, they interviewed people who HAD policies but had to forfeit them because premiums rose so much they could no longer afford the insurance. So there's money out the window.
I don't know who can afford 7k a month for nursing home care or even a fraction of that! I would think even if you scrimped all your life, your savings would be wiped out in a heartbeat if you needed long-term care.
Makes you think the lucky ones are the ones who are able to retire comfortably in their 60's and then just die peacefully in their sleep in their 70's before maladies and illness set in.
Because, of course, it is far more important for these gracious folks to leave an estate than to prepare to pay for the expenses they incur?
And I would say that the vast, vast majority of people in nursing homes never thought that they'd end up there. Not too many of us sit here thinking, "oh well, when the time comes I'll just go into that nursing home."
Long-term health care in the US is a disaster. Costs a ton and no one has the $$ for it. And other posters were right--this is an area in which it really makes a difference if you plan ahead. I keep trying to get my MIL to do this but she hasn't "gotten around to it" and probably never will. *She* also wants to give us $$ for granddaughter's education, but unless she puts it into a protected "for education only" account (eg, a 529) there's no guarantee it won't be taken to pay for her own medical care.
My father needed care. He was a brittle diabetic and no one could manage his meds. He liked to eat whatever he wanted, then give himself extra insulin to compensate. He needed to be in a place where food was not readily accessible and his insulin was controlled. We chose assisted living, there was a little more freedom and the cost was a bit less. But he was ambulatory and did not need nursing home level care. He lived there for 3 years, until he passed away.
As to finances, we paid for it. There was no medicaid payment. We paid monthly, just like rent. Then we paid for optional services used, such as laundry, medication dispensing, etc. 3 meals a day and cleaning were included. There were also many "community" activities: bus trips to malls & grocery stores, holiday parties, weekly sing-a-longs, daily tees and book clubs. They provided bus service to doctors offices and there were doctors that came to the facility. There was a nutritionist and each resident was provided with a diet that fit with their health needs. It was actually very pleasant. My father initially resisted, but I think he lived an extra 2 years because of it.
I'm in my 30's and have a LTC policy. It is true that most people collecting on them are young people that have been in accidents. I'm more worried getting in an accident driving to and from work. I didn't buy a LTC policy at my last job because the drive in to work was at lower speeds and back roads. I guess I could still have been injured but I felt safer. Now I'm on a major interstate with lots of semis. There are always 3-4 accidents on rainy days and it's not unusual for one of them to be an overturned semi. I don't want to be under or near one of those.
I would say that 60 is the latest you should wait to get a LTC policy but you could be playing with fire if you can afford it and don't have it. It's worth considering given any personal health risks and other outside factors that may result in long rehabilitations.
"Half the harm that is done in this world is due to people who want to feel important. They don't mean to do harm -- but the harm does not interest them. Or they do not see it, or they justify it because they are absorbed in the endless struggle to think well of themselves." – T.S. Eliot
LTC insurance is considerably lower in cost if you buy it when you're in your 40's, etc. than it is later on.
^^ I believe I understand you. My father was in a private assisted living residence. We paid every penny of it. However, he did have some money that needed to be transferred into other's names. The money would have been exhausted, if needed, for his care. Because we understood that while the money was in our names, it still belonged to him. However there was some left when he passed. By transferring it 5 years + before he passed, it eliminated many fees that would have been incurred to probate his will. There were still fees, but they were cut substantially. Also, it made it much easier on the family, it was not a long drawn out and painful process.
AceOn6, the golf loving skating fan
Exactly, thanks. Sadly, both my parents and inlaws passed away without any planning, so while we didn't have to worry about nursing homes, the probate and attorney fees were an expensive nightmare!
My mother's was the most complicated because of the state of her will, which was over 25 years old. (Plus the state of her paperwork. Disorganized, illegible, out of date and random.)
The lawyer had died, the witnesses had died, and the executor was elderly and not up to all the running around/getting certified copies of documents/statements needed for probate court.
It was good that my brother was listed on the bank account since there were many expenses to take care of unexpectedly. That little bit of planning made the effort less stressful.
Last edited by FigureSpins; 01-28-2011 at 10:29 PM.
Where I live, I can put a beneficiary on my investments, which means if something happens to me, those investments go straight to the beneficiary, and not through the estate. I also have joint accounts, with right of succession, which means the other person can still use the accounts and they won't be closed after my death. Again, easier on your executor.
My mum was in a chronic care facility. The payments were made monthly from a combination of her pension and savings. When she died, the savings were just and only used up. Had she lived longer, my Dad would have had to make up the difference, but they would have taken his finances into consideration.
I've had a will since I was 13 years old. I heard a story at the time about a relative who got cheated in a major way over the lack of a will.
BTW, regarding nursing home care and medicare. My father had a stroke and was in a nursing home for about 7 months before he died. Medicare paid for every day of his care, amazingly enough. They were about to cut off his medicare because he wasn't "making progress," and my mother pointed out some of the health problems he had as a result of being bedridden, and asked how he could make progress with these problems. And they said, "Oh, you're right." It was quite a relief because if they'd had to pay all of his care it would have been very tough on my mother. They'd been frugal and tried to plan, but they were not wealthy people. She was very upset about all that, in addition to the whole situation with my dad. This was more than 20 years ago, but it is just a reminder that it pays to keep asking questions.
The problem with LTC policies is that you can pay into them for many years and never use the policy.
Another option is that there are Universal Life policies that have a LTC rider on them. They let you take between 2-4% of the value of the policy to use on LTC care for up to 5 years. Of course, if you just pass away, it has a life benefit, unlike LTC plans.
It's just another option for people to look at.
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