AARP Bulletin Article on Long Term Care Insurance (drug, benefit, wife)
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We are fortunate in that we won't have to wait for existing home to sell to buy in...will use other liquid assets. For those that have their home paid for, they might consider taking out a mortgage until it sells.
Fortunately for both of us we can do that however I know the data shows most need that mortgage money. I am liking the monthly fee homes. It is a new trend and you don't have to worry about losing a boat load of money if they go under. You still have your nest egg growing if you can pay with in our case pensions and SS.
The 90 days is optional. It's part of the menu of choices you have.
You can do immediate, too...for a price.
Some people would prefer options like not having a semi private room.
Or the insurance for the "re-admissions bed".
The co-insurance.
Medicare does NOT always pay.
I would much rather have a LONGER period of time before it kicks in - for a cheaper price. I'd "self-insure" for maybe a 6 month period then if I really needed something for longer term I'd have it but for less money.
I would much rather have a LONGER period of time before it kicks in - for a cheaper price. I'd "self-insure" for maybe a 6 month period then if I really needed something for longer term I'd have it but for less money.
Many (somewhat affluent) feel the same, hoping for a policy with a long kick-in period (say 3 years) that then becomes effective to cover tail-end risk (unlimited). I read somewhere that insurance companies thought that policy would appeal to such a narrow segment of the population (most can't cover 3 years) that there wouldn't be many sold - resulting in minimal premiums paid in but that could still result in substantial payouts for those few who need care but for *years* - that racks up the bills.
I've deleted all my files and so don't have the exact stats ... but
I priced one with a really long self-pay period (longest allowed by the states, a year?) that covered only SNF for 5-6 years trying to reduce policy costs but capture a worst-case scenario. The policy price reduction just wasn't that much - not enough to give up the benefit of earlier payments and at-home care.
Fortunately for both of us we can do that however I know the data shows most need that mortgage money. I am liking the monthly fee homes. It is a new trend and you don't have to worry about losing a boat load of money if they go under. You still have your nest egg growing if you can pay with in our case pensions and SS.
The key is the particular CCRC you're looking at. The one we want to be in has been in existance for 60 years and has an A rating from Fitch. There have a 98 percent occupancy and over 1000 people on the waiting list. I have no problem giving them a chunk of $ for piece of mind and quality care in our last years. Evidently, there are a lot of people who can afford the $450-500k buy-in.
The key is the particular CCRC you're looking at. The one we want to be in has been in existance for 60 years and has an A rating from Fitch. There have a 98 percent occupancy and over 1000 people on the waiting list. I have no problem giving them a chunk of $ for piece of mind and quality care in our last years. Evidently, there are a lot of people who can afford the $450-500k buy-in.
Thats the dilemma at this stage of the game for us. We can go on a waiting list at a well established place and may well still do that and not worry about the buy in after we enter etc. However that sets certain time lines well in advance and that may be ok. Where we came from there was a very well established CCRC with a great history etc etc. A former neighbor had their mother join there and the husband went on the board of directors and shared some of the newly emerging issues they had. They had a low occupancy rate because times had changed and folks wanted more updated and larger living units. The retiring population had become more affluent with local housing prices having soared and their available equity much higher.
Folks who had come to the area in their twenties and thirties were now retiring with years of skyrocketing home equity and what they wanted had changed. Also the area had become more higher income with more investment and pension money available to retirees.
We looked at a beautiful new development in the Raleigh Triangle with a buy in up to about a million for single home estate type housing, well over 3000 sq feet. With a very large campus in a high end area with lots of sought after shopping facilities. We attended a round robin visitiation and spent time with the CFO and asked him some key questions about funding. Hmmmmm, it all involved 40 year bonds and low interest rates that could be renewed/extended in a year or so from that time. He was or at least acted comfortable bond rates would remain low. Not sure if that date has arrived yet but his bet may not be a great one. If not renewed the due date on the bonds could well be in our life time.
Years ago when first researching I was a big fan of Erickson communities and it all looked good. Multiple locations etc and then boom a chapter 11 filing. They were bought out by Redwood Capital and the ship was righted in a financial way however I wonderd would I now want to live in a CCRC owned by a investment group like Redwood? Would you as an investor? I am not sure.
Seems like the cost makes it almost impossible for those of us that do not have it to try and get it now unless you are very wealthy. If you are are very wealthy then you probably don't need it anyway.
Seems like the cost makes it almost impossible for those of us that do not have it to try and get it now unless you are very wealthy. If you are are very wealthy then you probably don't need it anyway.
Your first part I agree with your second part I wouldnt agree with. Newer, up scale CCRC's are selling a older retiree independent living life style with plush surroundings, gourment meals, activities, fitness centers with trainers etc etc. The accomodations can be luxurious flats etc. SNF part of it is only if you need it as is the memory care and possible assistant living. It enables you to age in a community and thus stay in that communnity and not feel the need to be taken out of your community for advanced care. It enables a spouse to be close by along with friends. Wine get togethers in the hall way or venues, game rooms and of course a pub for a beer burger and big screens to watch games. All in the effort to capture those who can afford to pay. So if you go in to Independent Living and need a visiting nurse they can do so while you are at home like anyone else. Safety procedures, one place you check in at night and if you haven't notified them they will check. Emergency cords to pull and at the one place with a hugh campus and man made lake you get a emergencey alert necklace that can track where you are and if some one will respond if you press the alert. Transportation for medical appointments or planned shopping etc. Lots to motivate people who can afford to live there. The buy in isn't for the end game but before the begging game. Folks love it as we have been there for social events and talked with. D
You don't need to be very wealthy just financially prepared for. As I noted previously these places tend to be geared toward the top 20 percent affluence of retirees in that area.
Different cost models may favor those with large fixed income or those with large nest eggs or a combination of. You need income above their monthly fees and wealth beyond the buy in to qualify.
Seems like the cost makes it almost impossible for those of us that do not have it to try and get it now unless you are very wealthy. If you are are very wealthy then you probably don't need it anyway.
I believe one of the articles (I forget which) covered this in that it said the higher your wealth, the more you could afford to finance any care yourself based on statistics that said it would not be that long.
depending on area there is really a window where protection is needed and warranted . over 1 million and under -5 million is where i feel it is useful in nyc . at 130k-140k a year if you have a stay at home spouse they would be severely impacted if they could not generate enough income on what is left . the rate of burn for two people would be very dangerous .
so under 1 million there is not much to protect and over 5 million there is likely enough to afford the care in our area . other areas may be 1/2 or even 1/3 those amounts .
For me the most important letter in LTCi is the I which stands for insurance. Insurance is just that protection against the possibility of something becoming a disruptive force in our lives. It is not about break even points or similar. It is about protection against.
In some ways I liken it to our having to decide whether to accept a lower pension benefit in order to insure that the income flow would continue to the remaining spouse in the event of one of us passing. Yes it is a reduced living income consequence but it helps provide Insurance for the remaining spouse. It also insures the ability of that spouse to be able to pay for LTC out of fixed income flow.
For that same reason we have umbrella coverage even though the odds are against us being sued.
Insurance is not always about getting your moneys worth it is for some about protection from!
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