“Long-term care, for most people, is a home care problem,” said Bill Comfort, who owns Comfort Long Term Care, a brokerage based in St. Louis and Durham, N.C."
Check out this excellent article on using Partnership LTC insurance to design meaningful and affordable LTC insurance coverage - especially for care at home. CLICK HERE to read the full article.
This is a fun ... and serious read about the importance of planning ahead for extended care (long-term care) needs! The five points:
Here is the link to the full article:
And remember, a little chocolate always helps!
A huge mistake that many people make when considering LTC insurance is "over-quoting".
Most people do not need to buy coverage for 100% of the cost of the highest-possible cost of care (skilled nursing home), and even shorter benefit periods (3-4 years) will cover the vast majority of care needs. It's kind of like thinking, "If I can't afford a Mercedes, then I'll just wait for the bus." It shouldn't be a zero-sum, all-or-nothing decision - that's a HUGE mistake. A Malibu with cloth seats and a 4-cylinder is great transportation ...
$3000 a month of LTC insurance benefits will pay for five hours of home care seven days a week, or 10 hours every-other day. It will cover more than 1/2 of a good Assisted Living Facility in most of the country, and provides a 33% "discount" to a $9000/month bill in a nursing home.
LTC insurance claims data show that 60%+ of claims start at home. Guess what, about 60% of claims also END at home. Only about 20% of LTC insurance claims end in a nursing home.
The average LTC insurance claim is less than four years, even less than three years for men. Cover that first before you worry about Alzheimer's care for 6+ years. If you only buy a 3-year policy (couples can "share" up to a total of 6 years for the price of 3 each), and if you do get Alzheimer's, you will still have much more private-pay flexibility than having nothing.
We need to stop worrying about the cost of care in a facility where most of us are NOT likely to end up (especially with reasonable - and affordable - planning). We do need to worry about where we will get an extra $3000-$4000 a month to pay for part-time home care so our spouse can have a life, get a good night's sleep, stay healthy, etc., and so our adult kids can be care managers not caregivers. Home care comes first. Always. And this is also where families are personally and financially most at risk when someone they love needs care.
Solve the part-time home care problem first.
Another story that confuses "independent living" with long-term care
This was an interesting article about alternative retirement living up until the author started comparing it to assisted living and nursing homes. (Link to full CNBC article at the end of this post.)
The only reasonable land-based analogy here is "independent living". Even mentioning assisted living, or worse nursing homes, is completely ridiculous. While a cruise ship is staffed for "medical care" that means, acute, temporary medical conditions, not long-term, custodial care. NO cruise ship will provide help for you to physically get out bed, bathe, dress, etc., the types of basic care services provided in assisted living. And NO cruise ship wants a long-term passenger with safety issues related to Alzheimer's or dementia. And if you're so poor off to be in a skilled nursing home, you probably can't even get on the ship.
Here is a quote from today's CNBC article:
A study published in the Journal of the American Geriatrics Society found that when considered over a 20-year span, "cruises were comparably priced to assisted living centers and offered a better quality of life, "though land-based assisted living can vary greatly by facility, location and needs."
And here's a quote from the source article linked in the quote above (published in 2004!), that itself is quoting an article (from 2004!) in a medical journal:
"Elderly people often choose assisted living facilities, nursing homes, 24 hours a day home caregivers, or family support. Living on a cruise ship might be a better choice, says Lee Lindquist, instructor of medicine at Northwestern University's Feinberg School of Medicine in Chicago, and a geriatrician at Northwestern Memorial Hospital."
Dr. Lindquist should lose her (his?) license, hospital privileges, and teaching post. While there are indeed people with canes, walkers, and wheelchairs on cruise ships, NONE of them are living there. And who is it helping them bathe and dress and use the toilet on board? Right, spouses or other family. If someone needs the degree of care provided in assisted living, they cannot "live" on a cruise ship. MAYBE they could take a vacation, but the ship's staff sure as heck is not going to provide any direct care services.
BTW, getting "long-term care" in a Holiday Inn is just as ridiculous.
Follow this link to the full article on-line:
Another article on the high cost of health care in retirement, and again, these numbers all exclude the cost of long-term care.
The Motley Fool does a good job of examining a couple of different studies on what we should expect to pay out of pocket for health care in retirement, and how even with estimates exceeding $240,000 over a 20-year retirement we may still be UNDER-estimating the cost.
MOST of the costs are monthly premiums for Medicare Part B and Medicare Supplement insurance, plus an average of Medicare deductibles and co-payments.
None of the studies cited include the cost of long-term care services.
The Fool's advice:
This is a well-done article that lays out facts and ways to approach the planning issues without relying on scare tactics.
Read the full article on-line by clicking HERE.
It's not about the car keys ... it's about the money.
New research suggests that aging parents have a "toxic combination" of low, or diminished, financial literacy but a high degree of confidence.
"In short, the more disconnected the seniors became from reality, the more they believed they could do a grand job making decisions about their money and investments."
Here's an excerpt from a Money magazine article about the cost of health care in retirement, and again, it is noted that the staggering numbers DO NOT include long-term care costs.
"Total retirement health care expenses for that 45-year-old couple planning to retire at age 65 will come to $592,275 in today’s dollars and $1.6 million in future dollars ... "
Click here for a link to the full article:
For about $160 a month that same 45-year-old couple can buy a LTC insurance policy that covers up to $432,000 of long-term care costs at age 69.
This idea (or the "Cruise ship vs. nursing home" variation) has been around on the internet and e-mail chains for years. But when my mom recently forwarded it to me from a group of her friends, it just set me off. Here's the e-mail ... my commentary follows:
No nursing home for us. We'll be checking into a Holiday Inn!
Please pardon my over-sensitivity to this old trope. I do realize it's really just a joke (as a "real" LTC planning idea it's truly a JOKE), but I meet far too many people on a daily basis who continue to turn a blind eye toward real, thoughtful, grown-up long-term care planning who take ideas like this as Conventional Wisdom, and they flippantly use it (or the "Cruise Ship vs. Nursing Home" variation) as a convenient way to allow themselves to shrug their shoulders at engaging in a personal, adult conversation about the topic.
The real problem with this is two-fold:
Click "Read More" below for more details:
1. Is the agent "Partnership" certified?
2. Does the agent sell "linked-benefit" LTC insurance?
3. Is the agent "captive"?
4. Does the agent represent or "broker" multiple companies?
5. Will the agent commit to a "free" (sales-free) initial consultation?
Click below to READ MORE
It's time to review your Medicare coverage. Medicare's "open enrollment" starts October 15th and runs through December 7th for coverage in 2016. Officially called the Annual Election Period (AEP), this is the only time (with only a few special exceptions) you can make changes to your Medicare coverage.
Most people on Medicare will benefit from an annual Part D Prescription Drug Plan (PDP) review. Your prescriptions may have changed in the past year, and the way your current plan covers your drugs (the "formulary") may be changing for 2016.
If you have a traditional Medicare Supplement (Medigap) policy with Original Medicare benefits be VERY CAREFUL about replacing it with a Medicare Advantage (Part C) plan. While a Medicare Advantage plan may offer very low monthly premiums, your coverage options - especially the choice of doctors and hospitals - will be very limited compared to Original Medicare with a full-coverage Medigap policy.
During the AEP, you may:
REMEMBER: Medicare does NOT cover long-term care.
If you don't have LTC insurance, this is also an excellent time to consider all of your retirement health care plans.
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