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since assisted livings don't accept medicare or medicaid that limits it for some if there truly is a legitimate option of nursing home or assisted living. there are some patients- primarily those with dementia and no skilled nursing needs - who could do assisted living, if there were no behavior issues- probably in a memory care unit as a level 3, but they would have to pay $5000 or $6000+ a month privately. if they can't do private pay the only option would be nursing home for long term care. <snip>
catsy girl
In some states, including Maryland, ALF's can (and do) accept medical assistance reimbursement through the Medicaid Waiver Program. Baltimore County Md. Aging - Assisted Living
That said, I would NEVER depend on Medical Assistance to pick up the tab for future long term care needs. I think that's crazy, given the national debt and the Boomer tsunami.
As the industry of LTC insurance evolves I see companies pulling out because of risk and premiums going up for the same reason. It's relatively uncharted terriory, hence the wobbling in coverage and premiums.
I wonder if putting that money in an investment vehicle wouldn't make more sense? At least you would still have the funds if it weren't needed. I see so many statistics that the actual time in a LTC facility is a very small percentage of your actual lifespan.
bet you can't find one sane person with a payed off home who let their fire insurance lapse and have none. even without a mortgage few would ever go with no insurance and yet there is a fraction of a chance it will be used.
the reality is we have our priorties mixed up when it comes to our money.
we just seem to hate spending money to protect our money in retirement and yet our finances are one of our biggest worrys.
folks do not insure their income stream by using annuity products and they do not insure their assets by using ltc insurance and those are the two biggest risks retirees face.
we decided to cut policy costs by taking 300 and not the 400-500 a day suggested in our area. we only took 3 years and will self insure the last 2 years,.
if accepted we will pay 7300.00 a year for premiums with a 20% tax credit from our state. i am 61 and marilyn 63.
while high ,our break even after 20 years would still be only a few months of care.
that is a fair trade off.
but the bigger issue is what happens after the insurance is up. most folks still get slammed by medicaid income restrictions. it is all well and good you get to keep the assets but living on 2931.00 a month for the at home spouse can be really tough in many areas.
that is another reason we shyed away from the life insurance type of ltc. our plan has agreements with our state over income and assets. most ltc insurance unless state sponsored has no provisions for allowing any form of substancial income from those assets you protected by having the ltc.
I thought it made sense to change our insurance to cover LTC. We don't have the 100% coverage, but it will help. Otherwise I am afraid one of us will bankrupt the other if we need LTC. Our policy lets us pay anyone of our choice if we need the help.
What kind of LTC package and at what price would be offered to a first-time taker in his/her 60s? Probably not much if any. So if you didn't take out your policy in your 20s, 30s, or 40s, probably forget it.
i took out a policy when i was 63. policy is for three years, $160 a day ( in-home, assisted living, skilled nursing ), and i pay about $2000 a year. in this area, assisted living ranges from $5000 to more than $6000 a month depending on level of care needed. i realize the daily rate won't cover all of that; i'm hoping that my retirement income can cover the gaps. my thinking is some coverage , if it's not a huge financial burden, is better than none, and can provide some options. i did see the difference that having some ltc coverage can make when i worked in geriatric care management.
In some states, including Maryland, ALF's can (and do) accept medical assistance reimbursement through the Medicaid Waiver Program. Baltimore County Md. Aging - Assisted Living
That said, I would NEVER depend on Medical Assistance to pick up the tab for future long term care needs. I think that's crazy, given the national debt and the Boomer tsunami.
when i worked in maryland as a social worker, the medicaid waiver program had been in effect about a year. the problems with that program, as i saw it, were huge waiting lists and most nationally known facilities not participating. most of the facilities participating were small , caring for 5-8 people, and therefore, the choices for placement were very limited. that situation may have changed, since i haven't been working in that capacity for over 10 years.
I appreciate the analytical and rational approach of your well informed post. One thing I wonder about: I have read such widely divergent "statistics" about the chances of eventually needing long-term care, and on the related theme of how much time, on average, those people who do need it end up spending under it before death claims them. I am always suspicious of information provided by those who have something for sale, which includes companies and their agents peddling long term care insurance.
I think those "statistics" are relevant to the discussion because they speak to the risks involved in taking a chance on not purchasing long term care insurance. Both the insurance itself and the costs of not having it are very pricey. Jghorton, any thoughts on the matter? Your response would be more credible to me than most, but of course I am interested in all responses.
We got to be pretty good friends with the CEO of my late FIL's SNF. Who was very plugged into these things (there are state/national associations of people who do what he does). At the time - about 10 years ago - he said that the odds were about 50% that a person would wind up in a SNF at some point in his/her life (the odds for women were higher than those for men because they tend to live longer - and because wives are more likely to be caregivers for their husbands than vice versa). Average length of stay was 2.5 years (although averages can mask large differences). Anyway - he was pretty matter of fact about these stats - and wasn't selling anything. Robyn
I appreciate the analytical and rational approach of your well informed post. One thing I wonder about: I have read such widely divergent "statistics" about the chances of eventually needing long-term care, and on the related theme of how much time, on average, those people who do need it end up spending under it before death claims them. I am always suspicious of information provided by those who have something for sale, which includes companies and their agents peddling long term care insurance.
I think those "statistics" are relevant to the discussion because they speak to the risks involved in taking a chance on not purchasing long term care insurance. Both the insurance itself and the costs of not having it are very pricey. Jghorton, any thoughts on the matter? Your response would be more credible to me than most, but of course I am interested in all responses.
Statistically and from observation (ministry), my guess would be 2-3 years in a SNF and 3-4-years in an ALF before transferring to a SNF. If one's LTC policy includes monitored Home Nursing Care, that could add another few years to the potential 'payout cycle.' But, remember, these statistics only include those who can actually afford an ALF/SNF or have LTC policy . The numbers would likely be significantly higher if it included those who need or would benefit from ALF/SNF care, but, cannot afford it or do not have LTC policy.
LTC is as much, if not more, about quality of life during one's last years ... as the financial aspects. We are all going to die at some point and few, if any, actually leave a SNF any other way. Also, if we live long enough to get old, feeble, incontinent, unable to care for our basic functions and mentally infirm --- it's not pretty or something most of us want to foist upon our spouse or children. Most of us would like to finish our race with as much dignity as possible. Along these lines, I think it is increasingly important to think seriously about 'End of Life directives; but, that's another topic.
Finally, like most 'health, asset protection and other' insurance policies, we don't buy them because we are guaranteed to get our money back, but, to avoid a significant downside if the associated event actually occurs. In the case of LTC, people are living longer and longer ... thereby progressively increasing the odds of needing LTC at some point in our lives. For me, I hope to never use LTC, but, certainly want to have it available if I need it.
mathjak, great point about fire insurance vs. LTC insurance. That really makes it plain as day. You would never not inure your house but skip LTC? Makes sense now.....
So much to learn, at least I'm starting early (50)
My father went into a LTC facility for about 6 months. My mom had LTC insurance on herself, thinking she'd be able to care for my father. As others have said, it's difficult to pick up a 160 lb. person off the floor who offers no help. My mom never used her policy having died at home.
We have a friend who just put age 50's husband in a home. He suffering from a form of dementia that affects the young. While he is physically able to care for himself, he can't be left alone because of his behavior.
While I have no plans to ever go into a LTC facility (after visiting my dad), sometimes we won't be able to make the decision for ourselves. Because of this, I signed both of us up for LTC insurance through our PERS plan. While we'd have enough to care for one of us without insurance, the spouse would have nothing to live on. Our policies have a daily and total dollar limits with simple inflation, so length of care will depend on the type being utilized. I figure we are covered for 4 years, which is longer than the average stay.
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