Long Term Care Insurance Premium Hikes

[KennyG]

Contract workers get paid a lot for the inconvenience of traveling, less job security and usually less benefits. Local hospitals have been offering big raises and cash bonuses to nurses who will go (or stay) full time and commit to stay for at least a year or two. They are doing this to reduce dependence on traveling nurses.

 

[ultrarunner]

Stanford had a special retention program paying big bucks for overtime and it worked...

 

[3Ts]

The annual premiums for my wife and I have doubled in the fifteen years since we bought into long term care insurance. The recent hike puts the combined annual premium at about five thousand dollars with us both in the mid seventies.

They say to buy this type of insurance when you're young but does that save in premiums as you're paying over more years? Wondering what others have experienced with rate increases in recent years?

We got our long term care about 30 yrs ago thru USAA. It is a group policy that is now managed by John Hancock insurance. We had our financial advisor review the policy (He was going to write one for us) and he couldn't come close to the benefits for the price. Our premiums for the 2 of us are about $2k per year and they have not increased since we purchased the policy. It includes home care and an inflation rider and we're responsible for the 1st 30 days (that 30 days had a big impact on the cost). It's been awhile since I've read it so I may be off a little.

Edit: We're in our early 70's so not to far off from you.

 

[npalen]

We got our long term care about 30 yrs ago thru USAA. It is a group policy that is now managed by John Hancock insurance. We had our financial advisor review the policy (He was going to write one for us) and he couldn't come close to the benefits for the price. Our premiums for the 2 of us are about $2k per year and they have not increased since we purchased the policy. It includes home care and an inflation rider and we're responsible for the 1st 30 days (that 30 days had a big impact on the cost). It's been awhile since I've read it so I may be off a little.

Edit: We're in our early 70's so not to far off from you.

Wow, that is incredible! Makes we wonder if John Hancock invested the premiums in something other than savings accounts. Low interest rates these past few years is one of the reasons Med America states for raising premiums.

My understanding is that the insurance companies have to appeal to their respective state insurance commissioner to get permission to raise their rates. Each state, I'm sure, is different, but part of their mission is to ensure that insurance companies remain solvent in order to pay claims down the road.

Edit: So you've probably paid about $60,000 in premiums in the last 30 years which sounds like a lot but it probably wouldn't pay for one year of LTC without insurance.
I think a lot of folks think "let the state take care of me", which may work out for them. The problem comes in when you've saved all of your life for retirement we try to protect that with insurance. Kind of a "catch 22", no?

 

[3Ts]

My MIL passed away back in 2005. She was in a nursing home for awhile and it was costing about $4,000 per month and nothing really elaborate. She was burning thru her finances fairly quickly so my wife & I started talking about what we could do to help out so she could at least maintain her lifestyle. (One person 15 years ago spending about $50k/yr - one would get bankrupted pretty quick). She passed away just before her 93rd birthday and still had a little bit of funds remaining. She was frugal and good with finances and planning, but sometimes inflation is more than what you expect it to be in retirement.

I would never want the state to take care of me, there were some nursing homes near one of the places that I lived that did that and that is NOT for me and you have to fit into the indigent category as I understand it. I believe they look back several years to see if the person transferred funds to someone else just to try to qualify as indigent.

Note: when selecting a policy, be sure the insurance company is a strong & stable company. If they fold, you're SOL and everything you've paid for goes out the window.

 

[Jstpssng]

Don't wait until you're 60 to try to sign up for a policy. Unless you have an impressive list of assets, they won't talk to you. At least, that was my experience.

 

[dmccarty]

There was a report in the WSJ in the last couple of days regarding taking care of parents. A woman went bankrupt taking care of her parents who had to go into nursing homes. One parent, was cost $10,000 a month for quite some time before he died.

We have a friend who is taking care of a parent with severe dementia. She can't bare to put them in a home though there is money to do so. The care giving is killing her...

Later,
Dan

 

[Snobdds]

We bought my parents a whole life medical insurance policy that they can use at the end. The policy kicks in when they loose 2 of the 6 functions of self sufficiency. They can draw it down until their is no longer any value left. They should be good for up to around 4 years of total care. If they never need it, the policy reverts back to my sister and I after their death.

Yeah it cost a lot, but it dosen't just go away at the end like long term care insurance does.

Also, get your parents assets out of their names. The state can put a lien on everything if medicade becomes the primary payor. A trust does not work, the deeds need to be in the heirs name for a minimum of 7 years before medicade no longer has a lookback period of asset value to attribute need. My parents own and still live in their house, but my sister and I are the ones on the deed. They pay us "rent", $10 a month, and are no longer the legal owners of the house and property.

A very good estate attorney and a good insurance agent from one of the big Life insurance companies (The prudential or MetLife) are worth their weight in gold. Pay them what ever they charge, and they will charge. However, it's still cheaper in the long run.

 

[ultrarunner]

10k is on the low side with 12k what I'm seeing in SF Bay Area.

Sobering especially in era of COVID...

 

[TractorTYMe]

My "care" insurance is if I'm unable to care for myself, keep the ooooold atv. Have someone prop me onto it.............I'll find a cliff somewhere.