Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by LadyGeek »

I removed a post and several replies regarding a WA state amendment for long-term care. Speculation about future legislation is prohibited by forum policy, see: Unacceptable Topics
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WoW2012
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by WoW2012 »

Sorry about that. I'll update the forum when it becomes law in about 2 weeks.
Disclaimer: I am a licensed insurance professional and am certified as a long-term care insurance specialist.
asdfgf
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by asdfgf »

WoW2012 wrote: Mon Apr 12, 2021 2:16 pm Sorry about that. I'll update the forum when it becomes law in about 2 weeks.
This is a really unfortunate application of that rule. I really wish I had seen the info assuming it related to the type of policies that can be purchased for the exemption.

Let me ask you this instead. Do you have any new thoughts on which of the following elements will be necessary to get an exemption:

-at least 3K/month benefit
-at least 36.5 K max benefit
-no elimination period
-inflation adjustment
WoW2012
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by WoW2012 »

asdfgf wrote: Mon Apr 12, 2021 11:57 pm
WoW2012 wrote: Mon Apr 12, 2021 2:16 pm Sorry about that. I'll update the forum when it becomes law in about 2 weeks.
This is a really unfortunate application of that rule. I really wish I had seen the info assuming it related to the type of policies that can be purchased for the exemption.

Let me ask you this instead. Do you have any new thoughts on which of the following elements will be necessary to get an exemption:

-at least 3K/month benefit
-at least 36.5 K max benefit
-no elimination period
-inflation adjustment

Hopefully we'll find out today from the WA Employee Security Dept what benefits must be included in a policy in order to qualify for the exemption.
Disclaimer: I am a licensed insurance professional and am certified as a long-term care insurance specialist.
dstac
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by dstac »

WoW2012 wrote: Tue Apr 13, 2021 9:01 am
asdfgf wrote: Mon Apr 12, 2021 11:57 pm
WoW2012 wrote: Mon Apr 12, 2021 2:16 pm Sorry about that. I'll update the forum when it becomes law in about 2 weeks.
This is a really unfortunate application of that rule. I really wish I had seen the info assuming it related to the type of policies that can be purchased for the exemption.

Let me ask you this instead. Do you have any new thoughts on which of the following elements will be necessary to get an exemption:

-at least 3K/month benefit
-at least 36.5 K max benefit
-no elimination period
-inflation adjustment

Hopefully we'll find out today from the WA Employee Security Dept what benefits must be included in a policy in order to qualify for the exemption.
Just a quick note on the history of the opt-out based on my conversations with a few people tracking this more closely... The original bill in 2019 was broadly supported as it would allow opt-out at any time. In 2020 the opt-out date limitations were put in place.

Trying to avoid specific proposed legislation that is in the works, I would note that concerns around the July date are widespread with a recognition that even a push to later in 2021 would provide some decision making room in the current environment.

For those that are impacted by this may want to continue to do research but wait for more detailed information later this month (like the ESD decision).
whatsagoodname
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by whatsagoodname »

Is there any immigration status requirements for the traditional LTCi? I heard that non-US citizens without green card can only purchase life insurance with LTC rider.
WoW2012 wrote: Mon Apr 12, 2021 9:39 am
asdfgf wrote: Fri Apr 09, 2021 7:53 pm
WoW2012 wrote: Fri Apr 09, 2021 3:16 pm
All of those companies sell traditional LTCi.
So, if I'm understanding you correctly, a random consumer (not fed employee or Knights of Columbus) going through an agent could only purchase from the following

Bankers Life & Casualty
Mutual of Omaha
National Guardian Life
New York Life
Northwestern Mutual
Thrivent


Is that right? Did I miss any?

I excluded the (worksite) ones, because I wasn't sure what that meant.
Correct.
Worksite means the policy can only be purchased through their employer as part of a "group" coverage.
WoW2012
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by WoW2012 »

whatsagoodname wrote: Wed Apr 14, 2021 11:48 pm Is there any immigration status requirements for the traditional LTCi? I heard that non-US citizens without green card can only purchase life insurance with LTC rider.
Of the six companies that sell traditional long-term care insurance in the state of Washington, only one company has a "citizenship" question. They will insure someone who is a Permanent Resident (Form I-551) Cardholder who hasresided in the U.S. at least 3 consecutive years. Five of the six companies selling traditional long-term care insurance in Washington do NOT ask a citizenship question.

Keep in mind, many insurance agents do not sell long-term care insurance because they canNOT sell long-term care insurance. In order to sell long-term care insurance you have to take special courses and you have to re-do the continuing education every two years.
Disclaimer: I am a licensed insurance professional and am certified as a long-term care insurance specialist.
almostretired1965
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by almostretired1965 »

For WoW2012 or anyone else who understands the LTCI options in WA and the regulatory environment:

So I am in the following situation. I am planning to retire permanently around May 2022. Until I became aware of this piece of legislation, I had zero interest in obtaining a LTCI since we do not expect to exhaust our assets even under the direst of circumstances that an LTCI would protect one against.

Basically, I want to obtain and pay for the least expensive policy possible that would allow me to get out of the tax, then drop the coverage when I retire. Anyway, how would I go about finding an agent that would help me execute this before the deadline?
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Soon2BXProgrammer
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by Soon2BXProgrammer »

almostretired1965 wrote: Thu Apr 15, 2021 12:29 pm For WoW2012 or anyone else who understands the LTCI options in WA and the regulatory environment:

So I am in the following situation. I am planning to retire permanently around May 2022. Until I became aware of this piece of legislation, I had zero interest in obtaining a LTCI since we do not expect to exhaust our assets even under the direst of circumstances that an LTCI would protect one against.

Basically, I want to obtain and pay for the least expensive policy possible that would allow me to get out of the tax, then drop the coverage when I retire. Anyway, how would I go about finding an agent that would help me execute this before the deadline?
You should consider just paying the tax for the 5 months...

Under the proposed legislation you have to have LTCi before the tax becomes effective, so you would be paying a policy for longer then the you would be paying the tax.
Isabelle77
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by Isabelle77 »

Just got our quote for my husband (I'm not working) $37 a month from Banker's Life for a similar policy to the one the state will offer $100 a day coverage up to 36.5K, 2% inflation protection. He's 44. Much better deal for us than paying the tax.
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by jstorz »

Soon2BXProgrammer wrote: Thu Apr 15, 2021 12:32 pm You should consider just paying the tax for the 5 months...

Under the proposed legislation you have to have LTCi before the tax becomes effective, so you would be paying a policy for longer then the you would be paying the tax.
Yeah I really hope we get some more information soon. I'm pretty young, reasonably high income, likely retiring within a decade, and also probably moving out of state at that time. So it's a no brainer for me to shop for my own policy and get the opt-out, then decide long term whether I need LTC insurance at all or I can self-fund.

I hate how much of a handout this is to the insurance industry, and how WA yet again is back door-ing an income tax that will likely be rubber stamped by the WA supreme court. Whether the govt should provide this is another issue, the fact is this is a bad deal for most people, will be underfunded, and barely covers any care at all if you do need it.
almostretired1965
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by almostretired1965 »

Soon2BXProgrammer wrote: Thu Apr 15, 2021 12:32 pm
almostretired1965 wrote: Thu Apr 15, 2021 12:29 pm For WoW2012 or anyone else who understands the LTCI options in WA and the regulatory environment:

So I am in the following situation. I am planning to retire permanently around May 2022. Until I became aware of this piece of legislation, I had zero interest in obtaining a LTCI since we do not expect to exhaust our assets even under the direst of circumstances that an LTCI would protect one against.

Basically, I want to obtain and pay for the least expensive policy possible that would allow me to get out of the tax, then drop the coverage when I retire. Anyway, how would I go about finding an agent that would help me execute this before the deadline?
You should consider just paying the tax for the 5 months...

Under the proposed legislation you have to have LTCi before the tax becomes effective, so you would be paying a policy for longer then the you would be paying the tax.
That is certainly one of the options, but in those 5 months, the tax could be $2K or higher for me, worse if I decide to stay longer. I don't want to violate the rules of the forum, but honestly, I will find it somewhat satisfying just to deny the state my $ for this program, even if it is a minor hit to my pocketbook.
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Soon2BXProgrammer
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by Soon2BXProgrammer »

almostretired1965 wrote: Thu Apr 15, 2021 2:16 pm
Soon2BXProgrammer wrote: Thu Apr 15, 2021 12:32 pm
almostretired1965 wrote: Thu Apr 15, 2021 12:29 pm For WoW2012 or anyone else who understands the LTCI options in WA and the regulatory environment:

So I am in the following situation. I am planning to retire permanently around May 2022. Until I became aware of this piece of legislation, I had zero interest in obtaining a LTCI since we do not expect to exhaust our assets even under the direst of circumstances that an LTCI would protect one against.

Basically, I want to obtain and pay for the least expensive policy possible that would allow me to get out of the tax, then drop the coverage when I retire. Anyway, how would I go about finding an agent that would help me execute this before the deadline?
You should consider just paying the tax for the 5 months...

Under the proposed legislation you have to have LTCi before the tax becomes effective, so you would be paying a policy for longer then the you would be paying the tax.
That is certainly one of the options, but in those 5 months, the tax could be $2K or higher for me, worse if I decide to stay longer. I don't want to violate the rules of the forum, but honestly, I will find it somewhat satisfying just to deny the state my $ for this program, even if it is a minor hit to my pocketbook.
Yeah i hear you, fund to stiff the state.. Just saying it have to balance time/effort/etc. It isn't clear yet how much policy is required for the opt out. etc.
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Soon2BXProgrammer
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by Soon2BXProgrammer »

jstorz wrote: Thu Apr 15, 2021 1:26 pm
Soon2BXProgrammer wrote: Thu Apr 15, 2021 12:32 pm You should consider just paying the tax for the 5 months...

Under the proposed legislation you have to have LTCi before the tax becomes effective, so you would be paying a policy for longer then the you would be paying the tax.
Yeah I really hope we get some more information soon. I'm pretty young, reasonably high income, likely retiring within a decade, and also probably moving out of state at that time. So it's a no brainer for me to shop for my own policy and get the opt-out, then decide long term whether I need LTC insurance at all or I can self-fund.

I hate how much of a handout this is to the insurance industry, and how WA yet again is back door-ing an income tax that will likely be rubber stamped by the WA supreme court. Whether the govt should provide this is another issue, the fact is this is a bad deal for most people, will be underfunded, and barely covers any care at all if you do need it.
The longer it is you are going to work, but still not hit the 10 year mark, the greater the value in figuring out how to opt out. I agree.
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by asdfgf »

WoW2012 wrote: Tue Apr 13, 2021 9:01 am
Hopefully we'll find out today from the WA Employee Security Dept what benefits must be included in a policy in order to qualify for the exemption.
So did we find out?
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by BruDude »

asdfgf wrote: Fri Apr 16, 2021 8:49 pm
WoW2012 wrote: Tue Apr 13, 2021 9:01 am
Hopefully we'll find out today from the WA Employee Security Dept what benefits must be included in a policy in order to qualify for the exemption.
So did we find out?
x2, I have not seen anything yet on the requirements. Anyone know?
WoW2012
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by WoW2012 »

BruDude wrote: Mon Apr 19, 2021 6:05 pm
asdfgf wrote: Fri Apr 16, 2021 8:49 pm
WoW2012 wrote: Tue Apr 13, 2021 9:01 am
Hopefully we'll find out today from the WA Employee Security Dept what benefits must be included in a policy in order to qualify for the exemption.
So did we find out?
x2, I have not seen anything yet on the requirements. Anyone know?

The only requirements right now are that the policy meets the definition of long-term care insurance under Washington state law.
Disclaimer: I am a licensed insurance professional and am certified as a long-term care insurance specialist.
softmax
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by softmax »

WoW2012 wrote: Mon Apr 19, 2021 6:09 pm
BruDude wrote: Mon Apr 19, 2021 6:05 pm
asdfgf wrote: Fri Apr 16, 2021 8:49 pm
WoW2012 wrote: Tue Apr 13, 2021 9:01 am
Hopefully we'll find out today from the WA Employee Security Dept what benefits must be included in a policy in order to qualify for the exemption.
So did we find out?
x2, I have not seen anything yet on the requirements. Anyone know?

The only requirements right now are that the policy meets the definition of long-term care insurance under Washington state law.
This sounds pretty low-bar. Is this going to change?
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by willthrill81 »

softmax wrote: Mon Apr 19, 2021 6:24 pm
WoW2012 wrote: Mon Apr 19, 2021 6:09 pm
BruDude wrote: Mon Apr 19, 2021 6:05 pm
asdfgf wrote: Fri Apr 16, 2021 8:49 pm
WoW2012 wrote: Tue Apr 13, 2021 9:01 am
Hopefully we'll find out today from the WA Employee Security Dept what benefits must be included in a policy in order to qualify for the exemption.
So did we find out?
x2, I have not seen anything yet on the requirements. Anyone know?

The only requirements right now are that the policy meets the definition of long-term care insurance under Washington state law.
This sounds pretty low-bar. Is this going to change?
Laws can be changed when lawmakers want them to.

That said, unless Olympia makes some significant changes to their definition soon, those who have any LTC policy in place by the deadline will pretty much be guaranteed to be exempt. The courts might have to get involved and likely will no matter what, but it's going to be hard to argue that someone's policy wasn't adequate when minimums weren't specified before the deadline.
“Good and ill have not changed since yesteryear; nor are they one thing among Elves and Dwarves and another among Men.” J.R.R. Tolkien, The Lord of the Rings
almostretired1965
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by almostretired1965 »

Let me try again, anyone have a recommendation for a good LTCI broker or consultant in WA state, preferably located on the Eastside. Feel free to send me a private message if you prefer not to reply in the thread.
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by jstorz »

almostretired1965 wrote: Mon Apr 19, 2021 11:01 pm Let me try again, anyone have a recommendation for a good LTCI broker or consultant in WA state, preferably located on the Eastside. Feel free to send me a private message if you prefer not to reply in the thread.
+1. Also I'm seeing that the amendment pushing the deadline to Nov 1 has passed the house and senate and the bill has been delivered to the governor. Hopefully we have a final confirmation soon:

https://app.leg.wa.gov/billsummary?Bill ... &Year=2021

Bill as passed (see underlined in section 5):

http://lawfilesext.leg.wa.gov/biennium/ ... %2Cnull%5D

A lot can change between now and then, but if this holds I will probably start getting quotes by mid summer at the latest. It can take time to go through medical underwriting in normal times, but I have to imagine they are going to be swamped. Good time to be in the LTC insurance business.
softmax
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by softmax »

almostretired1965 wrote: Mon Apr 19, 2021 11:01 pm Let me try again, anyone have a recommendation for a good LTCI broker or consultant in WA state, preferably located on the Eastside. Feel free to send me a private message if you prefer not to reply in the thread.
+1 to this. I'm totally new to LTCI :?
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by willthrill81 »

jstorz wrote: Mon Apr 19, 2021 11:27 pm
almostretired1965 wrote: Mon Apr 19, 2021 11:01 pm Let me try again, anyone have a recommendation for a good LTCI broker or consultant in WA state, preferably located on the Eastside. Feel free to send me a private message if you prefer not to reply in the thread.
+1. Also I'm seeing that the amendment pushing the deadline to Nov 1 has passed the house and senate and the bill has been delivered to the governor. Hopefully we have a final confirmation soon:

https://app.leg.wa.gov/billsummary?Bill ... &Year=2021

Bill as passed (see underlined in section 5):

http://lawfilesext.leg.wa.gov/biennium/ ... %2Cnull%5D

A lot can change between now and then, but if this holds I will probably start getting quotes by mid summer at the latest. It can take time to go through medical underwriting in normal times, but I have to imagine they are going to be swamped. Good time to be in the LTC insurance business.
Yes, the deadline extension has been finalized. TMK, there are still no specifics on what the minimums are for private LTCi in order to opt out. I'll likely wait until mid to late summer before applying for a policy, both to avoid paying premiums unnecessarily and to wait for potential specifics on the minimum. But at this point, it seems like the only real specifics that could be in play are the size of the inflation adjustment to benefits, the maximum daily benefit, and the elimination period. The WA state LTC plan's benefits will keep pace with inflation, the trust act was priced with a 45 day elimination period that was not included in the law, but I have no idea what the maximum daily benefit is.
“Good and ill have not changed since yesteryear; nor are they one thing among Elves and Dwarves and another among Men.” J.R.R. Tolkien, The Lord of the Rings
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Soon2BXProgrammer
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by Soon2BXProgrammer »

WoW2012 wrote: Mon Apr 19, 2021 6:09 pm
Sort of off topic for this thread, but how old is too old to buy LTC insurance? Or a hybrid policy? Is early 60s out of the question?
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by willthrill81 »

Soon2BXProgrammer wrote: Wed Apr 28, 2021 3:46 pm
WoW2012 wrote: Mon Apr 19, 2021 6:09 pm
Sort of off topic for this thread, but how old is too old to buy LTC insurance? Or a hybrid policy? Is early 60s out of the question?
Your health is the big question, but I think that if you're healthy that you can still get LTCi in your 60s.
“Good and ill have not changed since yesteryear; nor are they one thing among Elves and Dwarves and another among Men.” J.R.R. Tolkien, The Lord of the Rings
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by jstorz »

Soon2BXProgrammer wrote: Wed Apr 28, 2021 3:46 pm Sort of off topic for this thread, but how old is too old to buy LTC insurance? Or a hybrid policy? Is early 60s out of the question?
I'd probably get bids and run the math on how much more wage income you expect to make vs the costs. As written if you retire in less than 10 years you may not get any benefits, so if that's your plan I'd probably compare it against taking out a LTC policy and then cancelling as soon as you get an opt-out.

Similar situation with my plan to leave the state within a decade, but I am in my mid-30s so policy cost will likely be a lot less. I need to go a little deeper into it but my initial impression is that I would be better served self-funding LTC if it came to it. DEFINITELY vs the state plan which has laughable benefits, but even individual policies... I struggle to see how it's worth it for someone with good income vs decades of investment growth. The payout caps just aren't that high.
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by WoW2012 »

jstorz wrote: Wed Apr 28, 2021 4:13 pm
Soon2BXProgrammer wrote: Wed Apr 28, 2021 3:46 pm Sort of off topic for this thread, but how old is too old to buy LTC insurance? Or a hybrid policy? Is early 60s out of the question?
The payout caps just aren't that high.
My policy has almost $900,000 of LTCi benefits.
That seems pretty high to me.
Disclaimer: I am a licensed insurance professional and am certified as a long-term care insurance specialist.
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by jstorz »

WoW2012 wrote: Wed Apr 28, 2021 4:15 pm My policy has almost $900,000 of LTCi benefits.
That seems pretty high to me.
That's higher than I was thinking, but still less than a decade in a private room at current costs.

What are the premiums and how does starting earlier lock you in? Do you think that if someone invested that amount from ages 30-60 it would be in the same ballpark? I view insurance as for catastrophic and rare events. LTC feels right on that boundary of being claimed commonly enough that you should be able to plan for it without insurance and in all but the worst cases come out ahead. But I could be wrong
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by WoW2012 »

jstorz wrote: Wed Apr 28, 2021 4:37 pm
WoW2012 wrote: Wed Apr 28, 2021 4:15 pm My policy has almost $900,000 of LTCi benefits.
That seems pretty high to me.
That's higher than I was thinking, but still less than a decade in a private room at current costs.

What are the premiums and how does starting earlier lock you in? Do you think that if someone invested that amount from ages 30-60 it would be in the same ballpark? I view insurance as for catastrophic and rare events. LTC feels right on that boundary of being claimed commonly enough that you should be able to plan for it without insurance and in all but the worst cases come out ahead. But I could be wrong

Even a short claim, usually 6 months or less, recoups all premiums paid.
Disclaimer: I am a licensed insurance professional and am certified as a long-term care insurance specialist.
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by willthrill81 »

WoW2012 wrote: Wed Apr 28, 2021 5:36 pm
jstorz wrote: Wed Apr 28, 2021 4:37 pm
WoW2012 wrote: Wed Apr 28, 2021 4:15 pm My policy has almost $900,000 of LTCi benefits.
That seems pretty high to me.
That's higher than I was thinking, but still less than a decade in a private room at current costs.

What are the premiums and how does starting earlier lock you in? Do you think that if someone invested that amount from ages 30-60 it would be in the same ballpark? I view insurance as for catastrophic and rare events. LTC feels right on that boundary of being claimed commonly enough that you should be able to plan for it without insurance and in all but the worst cases come out ahead. But I could be wrong
Even a short claim, usually 6 months or less, recoups all premiums paid.
And that provides information on how often claims of such length are paid. If that happened too frequently, the insurers would go broke.
“Good and ill have not changed since yesteryear; nor are they one thing among Elves and Dwarves and another among Men.” J.R.R. Tolkien, The Lord of the Rings
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by WoW2012 »

willthrill81 wrote: Wed Apr 28, 2021 5:39 pm
WoW2012 wrote: Wed Apr 28, 2021 5:36 pm
jstorz wrote: Wed Apr 28, 2021 4:37 pm
WoW2012 wrote: Wed Apr 28, 2021 4:15 pm My policy has almost $900,000 of LTCi benefits.
That seems pretty high to me.
That's higher than I was thinking, but still less than a decade in a private room at current costs.

What are the premiums and how does starting earlier lock you in? Do you think that if someone invested that amount from ages 30-60 it would be in the same ballpark? I view insurance as for catastrophic and rare events. LTC feels right on that boundary of being claimed commonly enough that you should be able to plan for it without insurance and in all but the worst cases come out ahead. But I could be wrong
Even a short claim, usually 6 months or less, recoups all premiums paid.
And that provides information on how often claims of such length are paid. If that happened too frequently, the insurers would go broke.

"LTCi policies never pay!"
"LTCi policies pay too much!"
Disclaimer: I am a licensed insurance professional and am certified as a long-term care insurance specialist.
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by willthrill81 »

WoW2012 wrote: Wed Apr 28, 2021 5:43 pm
willthrill81 wrote: Wed Apr 28, 2021 5:39 pm
WoW2012 wrote: Wed Apr 28, 2021 5:36 pm
jstorz wrote: Wed Apr 28, 2021 4:37 pm
WoW2012 wrote: Wed Apr 28, 2021 4:15 pm My policy has almost $900,000 of LTCi benefits.
That seems pretty high to me.
That's higher than I was thinking, but still less than a decade in a private room at current costs.

What are the premiums and how does starting earlier lock you in? Do you think that if someone invested that amount from ages 30-60 it would be in the same ballpark? I view insurance as for catastrophic and rare events. LTC feels right on that boundary of being claimed commonly enough that you should be able to plan for it without insurance and in all but the worst cases come out ahead. But I could be wrong
Even a short claim, usually 6 months or less, recoups all premiums paid.
And that provides information on how often claims of such length are paid. If that happened too frequently, the insurers would go broke.
"LTCi policies never pay!"
"LTCi policies pay too much!"
I've never made either claim.
“Good and ill have not changed since yesteryear; nor are they one thing among Elves and Dwarves and another among Men.” J.R.R. Tolkien, The Lord of the Rings
jstorz
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by jstorz »

WoW2012 wrote: Wed Apr 28, 2021 5:43 pm "LTCi policies never pay!"
"LTCi policies pay too much!"
My take is it's a legitimate product. On the axis of car insurance that covers oil changes to catastrophic only health insurance I find it falls closer to the former for me. But that is a personal opinion.
WoW2012
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by WoW2012 »

jstorz wrote: Wed Apr 28, 2021 6:30 pm
WoW2012 wrote: Wed Apr 28, 2021 5:43 pm "LTCi policies never pay!"
"LTCi policies pay too much!"
My take is it's a legitimate product. On the axis of car insurance that covers oil changes to catastrophic only health insurance I find it falls closer to the former for me. But that is a personal opinion.
oil changes? what part of long-term care insurance is similar to an oil change?
Disclaimer: I am a licensed insurance professional and am certified as a long-term care insurance specialist.
jstorz
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by jstorz »

WoW2012 wrote: Wed Apr 28, 2021 6:33 pm oil changes? what part of long-term care insurance is similar to an oil change?
Maybe a bad example... if they sold auto insurance that covered oil changes I wouldn't get it, because (almost) everybody would file claims. The cost would have to be at least the cost of an oil change + overhead, and I would be better off just paying for the oil changes myself.

I'm not saying LTC is that extreme, just that it tips the scale that direction for me. Too many people end up needing LTC that I don't see the expected value working out in my favor vs investing extra now and just planning on covering those costs if necessary. Maybe I'm taking on more risk here, but it's something I'm ok with. Someone with fewer assets or older may feel differently.
WoW2012
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by WoW2012 »

jstorz wrote: Wed Apr 28, 2021 6:44 pm
WoW2012 wrote: Wed Apr 28, 2021 6:33 pm oil changes? what part of long-term care insurance is similar to an oil change?
Maybe a bad example... if they sold auto insurance that covered oil changes I wouldn't get it, because (almost) everybody would file claims. The cost would have to be at least the cost of an oil change + overhead, and I would be better off just paying for the oil changes myself.

I'm not saying LTC is that extreme, just that it tips the scale that direction for me. Too many people end up needing LTC that I don't see the expected value working out in my favor vs investing extra now and just planning on covering those costs if necessary. Maybe I'm taking on more risk here, but it's something I'm ok with. Someone with fewer assets or older may feel differently.

I find it hard to follow your reasoning.
Since a lot of people will use it, doesn't that mean you're likely to benefit from the policy?
Disclaimer: I am a licensed insurance professional and am certified as a long-term care insurance specialist.
Whakamole
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by Whakamole »

WoW2012 wrote: Wed Apr 28, 2021 8:12 pm
jstorz wrote: Wed Apr 28, 2021 6:44 pm
WoW2012 wrote: Wed Apr 28, 2021 6:33 pm oil changes? what part of long-term care insurance is similar to an oil change?
Maybe a bad example... if they sold auto insurance that covered oil changes I wouldn't get it, because (almost) everybody would file claims. The cost would have to be at least the cost of an oil change + overhead, and I would be better off just paying for the oil changes myself.

I'm not saying LTC is that extreme, just that it tips the scale that direction for me. Too many people end up needing LTC that I don't see the expected value working out in my favor vs investing extra now and just planning on covering those costs if necessary. Maybe I'm taking on more risk here, but it's something I'm ok with. Someone with fewer assets or older may feel differently.

I find it hard to follow your reasoning.
Since a lot of people will use it, doesn't that mean you're likely to benefit from the policy?
If a lot of people will use it, then the insurance will be priced accordingly, and be expensive. If you have enough assets, it's cheaper to self-insure (which is what jstorz is talking about.)

Insurance in general is efficiently priced; term insurance when you are young is cheap because it is unlikely that you will die, auto insurance is usually cheap because most people don't get into accidents (and if you do, premiums go up), health insurance is expensive because people get sick and medical care isn't cheap.
WoW2012
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by WoW2012 »

Whakamole wrote: Thu Apr 29, 2021 11:21 am
WoW2012 wrote: Wed Apr 28, 2021 8:12 pm
jstorz wrote: Wed Apr 28, 2021 6:44 pm
WoW2012 wrote: Wed Apr 28, 2021 6:33 pm oil changes? what part of long-term care insurance is similar to an oil change?
Maybe a bad example... if they sold auto insurance that covered oil changes I wouldn't get it, because (almost) everybody would file claims. The cost would have to be at least the cost of an oil change + overhead, and I would be better off just paying for the oil changes myself.

I'm not saying LTC is that extreme, just that it tips the scale that direction for me. Too many people end up needing LTC that I don't see the expected value working out in my favor vs investing extra now and just planning on covering those costs if necessary. Maybe I'm taking on more risk here, but it's something I'm ok with. Someone with fewer assets or older may feel differently.

I find it hard to follow your reasoning.
Since a lot of people will use it, doesn't that mean you're likely to benefit from the policy?
If a lot of people will use it, then the insurance will be priced accordingly, and be expensive. If you have enough assets, it's cheaper to self-insure (which is what jstorz is talking about.)

Insurance in general is efficiently priced; term insurance when you are young is cheap because it is unlikely that you will die, auto insurance is usually cheap because most people don't get into accidents (and if you do, premiums go up), health insurance is expensive because people get sick and medical care isn't cheap.

Maybe jstorz can share with us the LTCi quotes he's received so that we can see why LTCi is not a good value for him.
Disclaimer: I am a licensed insurance professional and am certified as a long-term care insurance specialist.
Isabelle77
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by Isabelle77 »

Scott Olson
Scott@ltcshop.com
Office: 877-727-9582


This is the agent we are using, he's on the west side but nowhere near us. Very reasonable quotes, we wound up choosing a Banker's Life policy that covers exactly what the new WA state plan will. $100 a day up to 365 days.
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Ben Mathew
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by Ben Mathew »

jstorz wrote: Wed Apr 28, 2021 6:44 pm
WoW2012 wrote: Wed Apr 28, 2021 6:33 pm oil changes? what part of long-term care insurance is similar to an oil change?
Maybe a bad example... if they sold auto insurance that covered oil changes I wouldn't get it, because (almost) everybody would file claims. The cost would have to be at least the cost of an oil change + overhead, and I would be better off just paying for the oil changes myself.

I'm not saying LTC is that extreme, just that it tips the scale that direction for me. Too many people end up needing LTC that I don't see the expected value working out in my favor vs investing extra now and just planning on covering those costs if necessary. Maybe I'm taking on more risk here, but it's something I'm ok with. Someone with fewer assets or older may feel differently.
I would put oil changes and LTC on opposite ends of the insurance-worthiness spectrum. Unlike oil changes, LTC expenses can vary a lot from person to person, are large relative to assets for most people, and are not known in advance. So unlike oil changes, there is a strong case to be made for LTC insurance if it is anywhere close to fairly priced.
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by jstorz »

WoW2012 wrote: Thu Apr 29, 2021 11:48 am Maybe jstorz can share with us the LTCi quotes he's received so that we can see why LTCi is not a good value for him.
I will if there's still interest after I get them ~mid summer. I have not done the full DD on this, only sharing my initial thoughts. It falls into the same bucket as dropping auto collision on older vehicles or raising deductibles to the max. I use insurance to lower my risk exposure to catastrophic events that would wipe me out, but are very rare. LTC is neither (although it would definitely be expensive to self-fund).

My gut feeling (and possibly uninformed I admit) is that the group of people best served by LTC are in between low income - and thus subsidized/medicaid eligible - and upper middle class w/savings. Those with enough assets to be regular or "chubby" FI, and no known risk or expectation of needing LTC earlier than is typical.
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by jstorz »

Isabelle77 wrote: Thu Apr 29, 2021 11:57 am Scott Olson
Scott@ltcshop.com
Office: 877-727-9582


This is the agent we are using, he's on the west side but nowhere near us. Very reasonable quotes, we wound up choosing a Banker's Life policy that covers exactly what the new WA state plan will. $100 a day up to 365 days.
Thanks for this!
Whakamole
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by Whakamole »

I've shopped around a bit and assuming you qualify at all for LTCI and can afford even basic premiums, it is impossible to find a policy worse than what Washington is forcing, considering the policy limitations and that it doesn't carry if you move to another state.
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by sudohouse »

I'm also shopping around and would like to find multiple quotes. If anyone has any contacts they liked please PM them to me. Thanks
WoW2012
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by WoW2012 »

Whakamole wrote: Thu Apr 29, 2021 1:17 pm I've shopped around a bit and assuming you qualify at all for LTCI and can afford even basic premiums, it is impossible to find a policy worse than what Washington is forcing, considering the policy limitations and that it doesn't carry if you move to another state.
There are LTCi policies that cost more and are "worse than" the WaLTCTA benefits.
But, if you do a little shopping around, especially if you work with an LTCi specialist, most people will be able to get a policy with MUCH better benefits for less premium than the WaLTCTA.
Disclaimer: I am a licensed insurance professional and am certified as a long-term care insurance specialist.
czaj
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by czaj »

Some reasons that self-insuring LTC makes sense to me:
- for those who are younger, it’s hard to buy insurance for something that won’t be needed for 50+ years. Too many things can change between now and then (LTC industry changes, federal programs, changes in medical technology where LTC is no longer needed)
- if LTC is necessary, in my mind “LTC” would be your only expense, fully replacing most other expenses. Most Bogleheads will likely have more than in their portfolio and SS to cover this.

That said, I am still planning to get a private policy (at least for however long I need it) to opt out of the WA payroll tax. If you have an HSA, you can also withdraw the LTC premiums tax-free.
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by Whakamole »

WoW2012 wrote: Sat May 01, 2021 8:44 am
Whakamole wrote: Thu Apr 29, 2021 1:17 pm I've shopped around a bit and assuming you qualify at all for LTCI and can afford even basic premiums, it is impossible to find a policy worse than what Washington is forcing, considering the policy limitations and that it doesn't carry if you move to another state.
There are LTCi policies that cost more and are "worse than" the WaLTCTA benefits.
But, if you do a little shopping around, especially if you work with an LTCi specialist, most people will be able to get a policy with MUCH better benefits for less premium than the WaLTCTA.
If there are, I haven't seen one.
* You have to pay into the program for 10 years (and work a set number of hours) to receive benefits.
* Moving out of state for 5 years will disqualify you from benefits, even if you paid into the plan for ten or more years.
* You have to be a resident of Washington State to get benefits. I hope your family also lives in WA, otherwise you won't see them often.
* You have to pay as long as your employer is based in Washington State, no matter where you live, even though you don't qualify for benefits unless you move to WA.
* Lifetime benefit of $36500.

https://www.ltc-associates.com/educatio ... #gs.zk63vn

If you can find a worse plan, let us know. I've heard of plans that don't pay out at all, but this is effectively the case for me since it's unlikely I'll be retiring here. Ignoring family reasons or climate preferences, the cost of nursing care is much more expensive here unless you live in the sticks away from good medical care.
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willthrill81
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by willthrill81 »

Whakamole wrote: Sat May 01, 2021 10:18 am
WoW2012 wrote: Sat May 01, 2021 8:44 am
Whakamole wrote: Thu Apr 29, 2021 1:17 pm I've shopped around a bit and assuming you qualify at all for LTCI and can afford even basic premiums, it is impossible to find a policy worse than what Washington is forcing, considering the policy limitations and that it doesn't carry if you move to another state.
There are LTCi policies that cost more and are "worse than" the WaLTCTA benefits.
But, if you do a little shopping around, especially if you work with an LTCi specialist, most people will be able to get a policy with MUCH better benefits for less premium than the WaLTCTA.
If there are, I haven't seen one.
* You have to pay into the program for 10 years (and work a set number of hours) to receive benefits.
* Moving out of state for 5 years will disqualify you from benefits, even if you paid into the plan for ten or more years.
* You have to be a resident of Washington State to get benefits. I hope your family also lives in WA, otherwise you won't see them often.
* You have to pay as long as your employer is based in Washington State, no matter where you live, even though you don't qualify for benefits unless you move to WA.
* Lifetime benefit of $36500.

https://www.ltc-associates.com/educatio ... #gs.zk63vn

If you can find a worse plan, let us know. I've heard of plans that don't pay out at all, but this is effectively the case for me since it's unlikely I'll be retiring here. Ignoring family reasons or climate preferences, the cost of nursing care is much more expensive here unless you live in the sticks away from good medical care.
I agree that the benefits vs. restrictions of WA state LTC plan are pretty awful, never mind the funding issues that they already know they will run into (like all such programs). Of the two LTC agents I've spoken to, to whom I explained my precise reasoning for potentially buying a policy (i.e., to save money vs. the state plan and without any regard for any other factor than getting the cheapest policy that will allow me to opt out), neither suggested any policy that I would say is worse than the state plan other than potentially not offering as much inflation protection. And the cost for me (age 40 and in good health) of a more than good enough policy would be under $400/year, a definite savings over the state plan. Once the state verifies that I did have a LTC policy in place at the time of the opt out window, I'll drop my LTC policy and remain permanently opted-out. So I figure that this state plan will wind up costing me around $2k with only an infinitesimal likelihood of any benefit (i.e., while I have the policy in force).
“Good and ill have not changed since yesteryear; nor are they one thing among Elves and Dwarves and another among Men.” J.R.R. Tolkien, The Lord of the Rings
WoW2012
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by WoW2012 »

willthrill81 wrote: Sat May 01, 2021 10:31 am Once the state verifies that I did have a LTC policy in place at the time of the opt out window, I'll drop my LTC policy and remain permanently opted-out.

That loophole is in the process of being closed.
Disclaimer: I am a licensed insurance professional and am certified as a long-term care insurance specialist.
WoW2012
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Re: Washington State Long Term Care Trust Act - 0.58% payroll tax - $36,500 lifetime maximum benefit

Post by WoW2012 »

czaj wrote: Sat May 01, 2021 10:06 am
- for those who are younger, it’s hard to buy insurance for something that won’t be needed for 50+ years.
If you have a secret of preventing someone from not needing any form of ADL-assistance for the next 50+ years, please share it.
Disclaimer: I am a licensed insurance professional and am certified as a long-term care insurance specialist.
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