LTC Strategies - Options and what are people doing?

Non-investing personal finance issues including insurance, credit, real estate, taxes, employment and legal issues such as trusts and wills.
Topic Author
MrCheapo
Posts: 1469
Joined: Tue Dec 22, 2020 2:43 pm

LTC Strategies - Options and what are people doing?

Post by MrCheapo »

Hi,

So the one part of the retirement puzzle I've paid little attention to is LTC.

I guess there are three options:

i) Insure, ii) Self-insure or iii) Rely on children and relatives

But i) seems challenging as they can pull the rug out from you at any time. I qualify (but not enrolled) for CALPERS (California's pension plan) LTC product, but they recently had premium increases of 52% though this is being challenged.

ii) Seems like the best route but given this table https://acl.gov/ltc/basic-needs/how-muc ... l-you-need how much money would be reasonable to put away? This table https://www.calperslongtermcare.com/Home/CostOfCare assumes about $10K a month so $120K a year for private full assistance. Does that sound reasonable?

iii) I don't want to explore. My kids need to live their life and my relatives are all overseas.

Which of three are people choosing and why? My plan is to self insure for about $250K and hopefully I won't need long term care in a facility (essentially I'm completely dependent on people) for more than 2 years.
Last edited by MrCheapo on Sun Nov 21, 2021 9:36 am, edited 1 time in total.
UpperNwGuy
Posts: 9479
Joined: Sun Oct 08, 2017 7:16 pm

Re: LTC Strategies - Options and what are people doing?

Post by UpperNwGuy »

I plan to self-insure.
User avatar
JoeRetire
Posts: 15381
Joined: Tue Jan 16, 2018 1:44 pm

Re: LTC Strategies - Options and what are people doing?

Post by JoeRetire »

MrCheapo wrote: Sun Nov 21, 2021 9:10 am Hi,

So the one part of the retirement puzzle I've paid little attention to is LTC.

I guess there are three options:

i) Insure, ii) Self-insure or iii) Rely on children and relatives

But i) seems challenging as they can pull the rug out from you at any time. I qualify (but not enrolled) for CALPERS (California's pension plan) LTC product, but they recently had premium increases of 52% though this is being challenged.

ii) Seems like the best route but given this table https://acl.gov/ltc/basic-needs/how-muc ... l-you-need how much money would be reasonable to put away? This table https://www.calperslongtermcare.com/Home/CostOfCare assumes about $10K a month so $120K a year for private full assistance. Does that sound reasonable?

iii) I don't want to explore. My kids need to live their life and my relatives are all overseas.

Which of three are people choosing and why?
We purchased LTCi plans a little over 7 years ago, shortly before turning 60.
No increases in the premium, although the benefits go up 3% every year.

As far as "why", for us it seems like good insurance. We are in the middle affluence group - able to afford the premiums, didn't want to skip insurance and just pay for care when it happens. We both have longevity in our genes. We each have relatives who were in long term care - including my wife's sister who was in assisted living and memory care with dementia for many years. We have worked hard to ensure that we are never a burden to our children.

We revisit the plan each year. So far, it's made sense to continue.
This isn't just my wallet. It's an organizer, a memory and an old friend.
Topic Author
MrCheapo
Posts: 1469
Joined: Tue Dec 22, 2020 2:43 pm

Re: LTC Strategies - Options and what are people doing?

Post by MrCheapo »

Thank you Joe.

Did you purchase the plan through your employer or is it a publicly available plan? Also, I'm having a hard time getting premium estimates since my employer funded plan is not accepting applications this year. Can you give me a ball park to the cost per year?

Thanks again.
JoeRetire wrote: Sun Nov 21, 2021 9:22 am
MrCheapo wrote: Sun Nov 21, 2021 9:10 am Hi,

So the one part of the retirement puzzle I've paid little attention to is LTC.

I guess there are three options:

i) Insure, ii) Self-insure or iii) Rely on children and relatives

But i) seems challenging as they can pull the rug out from you at any time. I qualify (but not enrolled) for CALPERS (California's pension plan) LTC product, but they recently had premium increases of 52% though this is being challenged.

ii) Seems like the best route but given this table https://acl.gov/ltc/basic-needs/how-muc ... l-you-need how much money would be reasonable to put away? This table https://www.calperslongtermcare.com/Home/CostOfCare assumes about $10K a month so $120K a year for private full assistance. Does that sound reasonable?

iii) I don't want to explore. My kids need to live their life and my relatives are all overseas.

Which of three are people choosing and why?
We purchased LTCi plans a little over 7 years ago, shortly before turning 60.
No increases in the premium, although the benefits go up 3% every year.

As far as "why", for us it seems like good insurance. We are in the middle affluence group - able to afford the premiums, didn't want to skip insurance and just pay for care when it happens. We both have longevity in our genes. We each have relatives who were in long term care - including my wife's sister who was in assisted living and memory care with dementia for many years. We have worked hard to ensure that we are never a burden to our children.

We revisit the plan each year. So far, it's made sense to continue.
Topic Author
MrCheapo
Posts: 1469
Joined: Tue Dec 22, 2020 2:43 pm

Re: LTC Strategies - Options and what are people doing?

Post by MrCheapo »

UpperNwGuy wrote: Sun Nov 21, 2021 9:15 am I plan to self-insure.
Me too but how much are you setting aside and what happens if you exceed that amount?

I plan to set aside $250K per adult (so $500K).
User avatar
ResearchMed
Posts: 16795
Joined: Fri Dec 26, 2008 10:25 pm

Re: LTC Strategies - Options and what are people doing?

Post by ResearchMed »

MrCheapo wrote: Sun Nov 21, 2021 9:10 am ii) Seems like the best route but given this table https://acl.gov/ltc/basic-needs/how-muc ... l-you-need how much money would be reasonable to put away? This table https://www.calperslongtermcare.com/Home/CostOfCare assumes about $10K a month so $120K a year for private full assistance. Does that sound reasonable?
You should take a look at a few of the types of facilities that are actually ones that you might end up at, rather than rely upon some state averages. The differences in facilities can be considerable, in both cost and quality of care.

If you find an "average cost" facility to be one that you would find suitable for yourself, then that's fine.
But if you notice that you would strongly prefer a higher priced facility (or would definitely NOT want an "average priced" facility), then you should know this enough in advance to plan accordingly. That could be to get enough LTC insurance or to save enough for an expected stay.

Also keep in mind that it can make a huge difference having enough money to "get into" a nicer facility if you can find one that will "not kick you out" if you run out of money, but will instead switch you to Medicaid and accept that amount.
These usually have some financial vetting, to rule out those who arrive with very little money and would run out almost right away, etc.

The "place" that DH and I have selected is about double the state average. But yes, they do "keep one" once one is "in".
We got to know this place inside out after MIL lived there for several years, so that helps. It's also a non-profit, associated vaguely with a religious/cultural background (but welcome anyone/everyone) and, more importantly, affiliated with a major nearby teaching hospital and medical school. (It happens to be the University where DH and I have been at since the 1970's, so we have a bit more background there, too.)

The association with the medical school/etc., is something we find particularly helpful, as it includes the teaching hospital where we've been getting our regular medical care for many years.

VISITING a place, several times, including unannounced visits, can be very important. Even better is so know someone living there, to get more of a feel for the place from the inside, if possible.
But just visiting can also sometimes give some surprisingly quick feedback.

RM
This signature is a placebo. You are in the control group.
User avatar
JoeRetire
Posts: 15381
Joined: Tue Jan 16, 2018 1:44 pm

Re: LTC Strategies - Options and what are people doing?

Post by JoeRetire »

MrCheapo wrote: Sun Nov 21, 2021 9:32 am Did you purchase the plan through your employer or is it a publicly available plan? Also, I'm having a hard time getting premium estimates since my employer funded plan is not accepting applications this year. Can you give me a ball park to the cost per year?
It's publicly available through Mutual of Omaha. We used an insurance broker. Accuquote: https://www.accuquote.com/products-serv ... term-care/

Your cost can vary widely, depending on the details of your policy, details of your health history, your state and county, inclusion of an inflation rider, length of the elimination period, etc, etc. The broker/agent can help you find ways to trade off benefits for lower premiums as necessary. When our first choice insurer quoted a higher premium due to my wife's health history, he found us a different insurer for the same benefits at a lower premium.

We pay about $5,200/year between us. My wife's policy costs more than mine, due to her gender, her health history, etc.

We were advised that "shortly before 60" was the sweet spot for purchasing LTCi. We are pleased so far. Hopefully, we never have to use the benefits - but of course that's true of all insurance we purchase.

Good luck.
This isn't just my wallet. It's an organizer, a memory and an old friend.
almostretired1965
Posts: 497
Joined: Mon Nov 13, 2017 1:02 pm

Re: LTC Strategies - Options and what are people doing?

Post by almostretired1965 »

We plan to self insure. What will be more of an issue is the fact that we do not have kids to help us out with things as we age like my sister and I are doing for my parents right now. We have sufficient funds to handle the most dire of circumstances but no one in the next generation in our extended families that we are really close to or trust to help manage things if and when cognition goes south.
Topic Author
MrCheapo
Posts: 1469
Joined: Tue Dec 22, 2020 2:43 pm

Re: LTC Strategies - Options and what are people doing?

Post by MrCheapo »

ResearchMed wrote: Sun Nov 21, 2021 9:39 am
MrCheapo wrote: Sun Nov 21, 2021 9:10 am ii) Seems like the best route but given this table https://acl.gov/ltc/basic-needs/how-muc ... l-you-need how much money would be reasonable to put away? This table https://www.calperslongtermcare.com/Home/CostOfCare assumes about $10K a month so $120K a year for private full assistance. Does that sound reasonable?
VISITING a place, several times, including unannounced visits, can be very important.
Under cover old codger: Could be a reality show!

Seriously is it true some facilities can throw you out once your in?
User avatar
WoodSpinner
Posts: 3505
Joined: Mon Feb 27, 2017 12:15 pm

Re: LTC Strategies - Options and what are people doing?

Post by WoodSpinner »

MrCheapo wrote: Sun Nov 21, 2021 9:10 am Hi,

So the one part of the retirement puzzle I've paid little attention to is LTC.

I guess there are three options:

i) Insure, ii) Self-insure or iii) Rely on children and relatives

But i) seems challenging as they can pull the rug out from you at any time. I qualify (but not enrolled) for CALPERS (California's pension plan) LTC product, but they recently had premium increases of 52% though this is being challenged.

ii) Seems like the best route but given this table https://acl.gov/ltc/basic-needs/how-muc ... l-you-need how much money would be reasonable to put away? This table https://www.calperslongtermcare.com/Home/CostOfCare assumes about $10K a month so $120K a year for private full assistance. Does that sound reasonable?

iii) I don't want to explore. My kids need to live their life and my relatives are all overseas.

Which of three are people choosing and why? My plan is to self insure for about $250K and hopefully I won't need long term care in a facility (essentially I'm completely dependent on people) for more than 2 years.
I have been a long time (15 years) subscriber of the Calpers LTC insurance and have continued even through the rate increases.

See viewtopic.php?t=355551 for details.

My best advice is to consult an independent broker and compare costs and benefits. Since your would be a new subscriber the economics may shift from my findings.

My wife OTOH is not insurable with traditional LTC insurance so we plan to self-fund and have put aside $500K towards this eventuality.

WoodSpinner
WoodSpinner
Topic Author
MrCheapo
Posts: 1469
Joined: Tue Dec 22, 2020 2:43 pm

Re: LTC Strategies - Options and what are people doing?

Post by MrCheapo »

WoodSpinner wrote: Sun Nov 21, 2021 10:33 am I have been a long time (15 years) subscriber of the Calpers LTC insurance and have continued even through the rate increases.

See viewtopic.php?t=355551 for details.

My best advice is to consult an independent broker and compare costs and benefits. Since your would be a new subscriber the economics may shift from my findings.

My wife OTOH is not insurable with traditional LTC insurance so we plan to self-fund and have put aside $500K towards this eventuality.

WoodSpinner
So to be clear you joined when you were 45? It seems you are 61 now. The rates of $2600 p.a. seem very affordable but I guess you already payed 15 years x $1300 = $19500 already as a sunk cost. That's still very affordable.

Unfortunately Calpers is not accepting any LTC insurance business.

I hope you don't need it.
UpperNwGuy
Posts: 9479
Joined: Sun Oct 08, 2017 7:16 pm

Re: LTC Strategies - Options and what are people doing?

Post by UpperNwGuy »

MrCheapo wrote: Sun Nov 21, 2021 9:37 am
UpperNwGuy wrote: Sun Nov 21, 2021 9:15 am I plan to self-insure.
Me too but how much are you setting aside and what happens if you exceed that amount?

I plan to set aside $250K per adult (so $500K).
I'm aiming for $400,000 for a single adult, but my assumption is that I might need a year or two of assisted living prior to entering skilled nursing.
ZWorkLess
Posts: 425
Joined: Thu May 04, 2017 8:13 pm

Re: LTC Strategies - Options and what are people doing?

Post by ZWorkLess »

We are self-insuring because when I looked for LTC insurance several years ago (late 40s to early 50s for me & spouse), the products available all had a time limit on how long you could collect, which IMHO, totally eliminates the benefit of the LTC insurance (ie., insure against worst case scenarios). I'm thinking we need probably $2M in assets to actually self-insure for both of us long term. So, I guess that means that we shouldn't dip below $2M in assets as long as both of us are alive, maybe $1M if just one of us . . .

But those numbers could include our principal residence, which I haven't considered as part of our retirement nest egg, so that helps a lot, maybe making it $1.3M additional beyond what we plan/hope to spend in retirement . . .

Personally, neither my spouse nor I would voluntarily reside in LTC, so we'd aim to pay for in home help and probably choose the jump-off-a-bridge LTC insurance plan if that was no longer an option. Hopefully, we'll die "naturally" before we have to make those choices, which simply means we will be leaving a substantial inheritance if all goes according to plan.

This need for a vast sum of money set aside until one drops dead to cover the worst-case-scenario-LTC needs significantly increases our savings needs . . . And that's why my goal number is $X + house instead of $x/2 + house . . .

What I'd really love is a catastrophic LTC policy -- say one that kicked in after you'd self-paid for 2-3 years . . . but that seems to be the thing the insurance companies most want to avoid . . .
User avatar
WoodSpinner
Posts: 3505
Joined: Mon Feb 27, 2017 12:15 pm

Re: LTC Strategies - Options and what are people doing?

Post by WoodSpinner »

MrCheapo wrote: Sun Nov 21, 2021 11:16 am
WoodSpinner wrote: Sun Nov 21, 2021 10:33 am I have been a long time (15 years) subscriber of the Calpers LTC insurance and have continued even through the rate increases.

See viewtopic.php?t=355551 for details.

My best advice is to consult an independent broker and compare costs and benefits. Since your would be a new subscriber the economics may shift from my findings.

My wife OTOH is not insurable with traditional LTC insurance so we plan to self-fund and have put aside $500K towards this eventuality.

WoodSpinner
So to be clear you joined when you were 45? It seems you are 61 now. The rates of $2600 p.a. seem very affordable but I guess you already payed 15 years x $1300 = $19500 already as a sunk cost. That's still very affordable.

Unfortunately Calpers is not accepting any LTC insurance business.

I hope you don't need it.
OP,

So Calpers LTC is not accepting new subscribers?

Agreed I hope it’s a waste of money—as is true with most insurance!

WoodSpinner
WoodSpinner
User avatar
ResearchMed
Posts: 16795
Joined: Fri Dec 26, 2008 10:25 pm

Re: LTC Strategies - Options and what are people doing?

Post by ResearchMed »

MrCheapo wrote: Sun Nov 21, 2021 10:02 am
ResearchMed wrote: Sun Nov 21, 2021 9:39 am
MrCheapo wrote: Sun Nov 21, 2021 9:10 am ii) Seems like the best route but given this table https://acl.gov/ltc/basic-needs/how-muc ... l-you-need how much money would be reasonable to put away? This table https://www.calperslongtermcare.com/Home/CostOfCare assumes about $10K a month so $120K a year for private full assistance. Does that sound reasonable?
VISITING a place, several times, including unannounced visits, can be very important.
Under cover old codger: Could be a reality show!

Seriously is it true some facilities can throw you out once your in?
Double check the terms and conditions, etc.

These places aren't usually charities (although there are some that are). So if one has NO money left...??
I doubt they drop someone at the curb these days, but I suspect they will help you get an expedited entry to a possibly grim Medicaid facility. Take a look at some in that category, too.

And some people may wait until they already have run out of money, and then there's no chance of getting into one of the "nicer places that will keep you..."

(MIL had been in one of the best [=$$$$] facilities for about 6 years. They had been very careful to double check her finances before her arrival. Then the end of her money seemed to be approaching. They were helping us to get started on the paperwork to switch her payment status to Medicaid. Her room, her care, etc., would not have changed much if at all. But she passed a few weeks before her 100th, before the funding situation ever changed.)

RM
This signature is a placebo. You are in the control group.
Sammy45
Posts: 21
Joined: Sun Oct 24, 2021 8:52 am
Location: Western Washington

Re: LTC Strategies - Options and what are people doing?

Post by Sammy45 »

WoodSpinner wrote: Sun Nov 21, 2021 1:24 pm
So Calpers LTC is not accepting new subscribers?
wow - that was news to me too...

Per calpers LTC Site:

CalPERS has suspended open enrollment due to current uncertainty in the long-term care market and is no longer accepting applications.

In November 2020, the CalPERS Board of Administration approved a rate increase on all Long-Term Care Program policies. The rate adjustments will be phased in over two years. A 52% increase will take effect no earlier than November 2021. If necessary, a second increase of up to 25% would take effect no earlier than fall 2022.
firedinky
Posts: 31
Joined: Sun Aug 06, 2017 9:07 am
Location: Kentucky

Re: LTC Strategies - Options and what are people doing?

Post by firedinky »

[quote=
What I'd really love is a catastrophic LTC policy -- say one that kicked in after you'd self-paid for 2-3 years . . . but that seems to be the thing the insurance companies most want to avoid . . .
[/quote]

A hybrid Life /LTC policy with an unlimited time rider was the closest thing we could find to a catastrophic plan. This also solved the premium increase problem since the total upfront cost is fixed. In our case 100k for the life policy and about 60k for the rider which included 5% inflation increase for my wife and me.

This policy would not cover a worst case scenario of high quality nursing home for one of us or even assisted living for both.

But whether to self insure is not an either or decision. The annual (and unlimited duration) LTC coverage greatly reduces the net worth requirement for self insuring. And in our case, the life policy guarantees at least something to the kids after we both pass if the LTC is unused.
User avatar
thursdaysd
Posts: 126
Joined: Tue May 13, 2014 10:55 am
Location: NC
Contact:

Re: LTC Strategies - Options and what are people doing?

Post by thursdaysd »

I have made a deposit on a CCRC. It's a non-profit with what look like sound finances, and guarantees not to kick me out if I run out of money. Of course, I have to pass the health and financial checks before I actually move in, which should be in two years when their new building is finished. I am divorced, no kids, and relatives all living abroad.

I am more interested in the Assisted Living facility than Skilled Nursing. If I get a diagnosis that would put me in SN long term, I plan a one-way trip to Dignitas in Switzerland.
Thursday's child has far to go
RetiredCSProf
Posts: 1228
Joined: Tue Feb 28, 2017 3:59 pm

Re: LTC Strategies - Options and what are people doing?

Post by RetiredCSProf »

I have both insurance and "self-insurance." I do not expect family or friends to take care of me, but I do expect them to spend time with me.

I purchased a hybrid life insurance / LTCi policy with a one-time premium. It pays up to seven years of long-term care (at home or in a facility) and has a 3% annual inflation rider. The monthly payout is about $4000 per month (if used in my early 80's). I would "break even" if I use it for 18 months of LTC. That is, I have insured against the risk of needing long-term care for longer than the "average" length of stay (22-28 months).

I have a pension and plan to keep "enough" in my tax-deferred IRAs to supplement the LTCi policy.

How much is "enough"? No idea. RMDs will start to drain my TDAs in my mid-80's. Assuming a 5% annual growth rate and a balance of $400,000 in a TDA at age 90, leaves me with less than $200,000 in the TDA at age 100 and only about $100,000 at age 104. (Note: estimates were calculated using the Schwab RMD calculator, which may not have been updated with the newer RMD table taking effect in 2022.)
User avatar
Watty
Posts: 28860
Joined: Wed Oct 10, 2007 3:55 pm

Re: LTC Strategies - Options and what are people doing?

Post by Watty »

Options and what are people doing?
We are fortunate to live in an area where the LTC costs are below the national average. You can get an idea of what LTC might cost in your area on this web site.

https://www.genworth.com/aging-and-you/ ... -care.html

It is important to look closely at the different types of "long term care" since when someone says that their parent spent five years in LTC they may mean four years in the much lower cost assisted living and only one year in the more expensive nursing home.

You also need to keep in mind that if you go into LTC then most of your other expenses will stop so you mainly need to be concerned about the gap between your normal retirement budget and your budget in LTC. For example if LTC costs $90K a year in your area but your normal retirement budget is $60K then you mainly just need to figure out how to fund the $30K difference.

Our biggest risk is that LTC might be needed while we are both still alive so that the other costs do not decline when one of us goes into LTC.

We plan to use the home equity in out paid off house to pay for LTC if we need to either by selling it or getting some sort of mortgage like a reverse mortgage. Even if we are both alive that could fund a number of years of LTC.

One important thing is that we have enough to get into a good nursing home that will let us stay if we outlive our money.

That is not a perfect plan but with flexibility there are lots of ways to handle many different scenarios.
UpperNwGuy
Posts: 9479
Joined: Sun Oct 08, 2017 7:16 pm

Re: LTC Strategies - Options and what are people doing?

Post by UpperNwGuy »

Watty wrote: Sun Nov 21, 2021 6:25 pm It is important to look closely at the different types of "long term care" since when someone says that their parent sent five years in LTC they may mean four years in the much lower cost assisted living and only one year in the more expensive nursing home.

You also need to keep in mind that if you go into LTC then most of your other expenses will stop so you mainly need to be concerned about the gap between your normal retirement budget and your budget in LTC. For example if LTC costs $90K a year in your area but your normal retirement budget is $60K then you mainly just need to figure out how to fund the $30K difference.

Our biggest risk is that LTC might be needed while we are both still alive so that the other costs do not decline when one of us goes into LTC.
This is the best summary of how to view long term care. I spent the last decade dealing with my parents failing health and passing, and it all unfolded just as Watty described it.
drzzzzz
Posts: 1047
Joined: Sat Sep 22, 2012 9:56 pm

Re: LTC Strategies - Options and what are people doing?

Post by drzzzzz »

Spouse and I both have long term care policies and while they are expensi ve they appear "cheap" assuming they are still around when/if we need them and depending on the length of time they will pay for. I am going through LTC this with my parents and between what I would view as long term care inflation, COVID issues related to staffing, and everything being much more expensive than I anticipated I am happy to pay the LTC premiums for now.

My father was in a rehab/nursing home that was rated very highly in the past and the level of care and attention he received was minimal on a good day. I finally got fed up after he fell at the place and refractured his back (the reason he was there). Brought him to his apartment and am hiring close to 24x7 care for him while I pick up some shifts, coordinate care, and fill in - finding people who are reliable is difficult. The agencies were useless since their people often didn't show up (likely a combination of who they were hiring and what they were paying). The agency personnel also werent allowed through either state or company policies to do certain things for the care of a patient. For example, some wouldnt do physical therapy exercises on days when the therapist wasnt there. Most of the agency personnel are not able to feed a patient or pop a pill in the patient's mouth (risk for aspiration and choking which I appreciate), but if the patient needs the pills or needs help eating that can be problematic.
I ended up hiring an aide who was recommended by a friend and another on nextdoor and discovered that there seems to be a community of aides who often know each other and help each other out with job referrals since their clients often die and so they need new ones. It is expensive but still cheaper than paying the fees of the typical nursing home facility and my father gets 1:1 attention from them. And aides are also more expensive than what one might think (at least in our area) - no one is working for $8 an hour or less any longer - more like double that.

So nursing home costs- I thought these would be around 8,000 to 10,000 per month. So wrong. The facility where he fell at charges $507 a day which includes gourmet food that he would never eat and community spaces that aren't used because of COVID. I contacted a dozen places about placement, a few had no space, wouldn't take his pretty good health insurance after a hospital stay, or had waits of from 6 months to 2 years. Two of the religious orders (which I thought might be cheaper), suprised me and said their costs were 15,000 to 18,000 per month and they had 4 people on a list to get in and that it would likely be 2 years. They do agree to keep him if he runs out of money and would then apply for Medicaid for him. I also looked at memory care places which add an additional 1000 or 2000 per month.

I am happy with the current situation of having aides come in to care for him, but this end of life process is not cheap and it will go through all of his resources and then likely some of mine. I know people talk about going on Medicaid after spending the funds, but you need to process whether you want your family member at a facility that takes Medicaid since sometimes the care is less than optimal. In his original rehab place, on weekends you couldn't find an aide or nurse, patients had call bells on for long periods, and some patients in pain were screaming for help - again this was one of the better places in our area that takes private pay as well as Medicaid. All very depressing, hoping that I go quickly without having to put the burden of long term care on family members.
Last edited by drzzzzz on Sun Nov 21, 2021 6:49 pm, edited 1 time in total.
randomguy
Posts: 11295
Joined: Wed Sep 17, 2014 9:00 am

Re: LTC Strategies - Options and what are people doing?

Post by randomguy »

UpperNwGuy wrote: Sun Nov 21, 2021 12:27 pm
MrCheapo wrote: Sun Nov 21, 2021 9:37 am
UpperNwGuy wrote: Sun Nov 21, 2021 9:15 am I plan to self-insure.
Me too but how much are you setting aside and what happens if you exceed that amount?

I plan to set aside $250K per adult (so $500K).
I'm aiming for $400,000 for a single adult, but my assumption is that I might need a year or two of assisted living prior to entering skilled nursing.
0 dollars. My expenese will plummet when I go into LTC and between SS and spending down the portfolio, I expect to be good for 10-15 years with poor returns. And then if it fails, the medicaid will pay for care...
randomguy
Posts: 11295
Joined: Wed Sep 17, 2014 9:00 am

Re: LTC Strategies - Options and what are people doing?

Post by randomguy »

RetiredCSProf wrote: Sun Nov 21, 2021 5:48 pm

How much is "enough"? No idea. RMDs will start to drain my TDAs in my mid-80's. Assuming a 5% annual growth rate and a balance of $400,000 in a TDA at age 90, leaves me with less than $200,000 in the TDA at age 100 and only about $100,000 at age 104. (Note: estimates were calculated using the Schwab RMD calculator, which may not have been updated with the newer RMD table taking effect in 2022.)
I fail to follow. RMDs are moving money from your TDA to a taxable account. Why can't you use that taxable account to pay for LTC?
hudson
Posts: 7119
Joined: Fri Apr 06, 2007 9:15 am

Re: LTC Strategies - Options and what are people doing?

Post by hudson »

UpperNwGuy wrote: Sun Nov 21, 2021 9:15 am I plan to self-insure.
Me too.
For years, I've read the discussions on LTC insurance. I decided long ago to pass; nothing I've read since has changed my mind. LTC insurance does not seem to be a good product.
I don't want to burn any money on something questionable that I may or may not use.
My plan is to just muddle through unless somebody comes up with a better idea.
RetiredCSProf
Posts: 1228
Joined: Tue Feb 28, 2017 3:59 pm

Re: LTC Strategies - Options and what are people doing?

Post by RetiredCSProf »

randomguy wrote: Sun Nov 21, 2021 6:44 pm
RetiredCSProf wrote: Sun Nov 21, 2021 5:48 pm

How much is "enough"? No idea. RMDs will start to drain my TDAs in my mid-80's. Assuming a 5% annual growth rate and a balance of $400,000 in a TDA at age 90, leaves me with less than $200,000 in the TDA at age 100 and only about $100,000 at age 104. (Note: estimates were calculated using the Schwab RMD calculator, which may not have been updated with the newer RMD table taking effect in 2022.)
I fail to follow. RMDs are moving money from your TDA to a taxable account. Why can't you use that taxable account to pay for LTC?
Using income to cover LTC expenses increases the deduction for medical expenses; thus, reduces income taxes. BHs frequently post that TDAs are a good place for holding LTC "self-insurance" because the withdrawal always generates income. Withdrawing from a taxable account is also a taxable event, with the tax impact dependent on cap gain/loss from the withdrawal. From a tax standpoint, holding LTC "self-insurance" in a TDA is usually a better choice than holding it in a taxable account. Aging increases the likelihood of needing LTC; aging drains the TDA account.
randomguy
Posts: 11295
Joined: Wed Sep 17, 2014 9:00 am

Re: LTC Strategies - Options and what are people doing?

Post by randomguy »

RetiredCSProf wrote: Mon Nov 22, 2021 10:41 am
randomguy wrote: Sun Nov 21, 2021 6:44 pm
RetiredCSProf wrote: Sun Nov 21, 2021 5:48 pm

How much is "enough"? No idea. RMDs will start to drain my TDAs in my mid-80's. Assuming a 5% annual growth rate and a balance of $400,000 in a TDA at age 90, leaves me with less than $200,000 in the TDA at age 100 and only about $100,000 at age 104. (Note: estimates were calculated using the Schwab RMD calculator, which may not have been updated with the newer RMD table taking effect in 2022.)
I fail to follow. RMDs are moving money from your TDA to a taxable account. Why can't you use that taxable account to pay for LTC?
Using income to cover LTC expenses increases the deduction for medical expenses; thus, reduces income taxes. BHs frequently post that TDAs are a good place for holding LTC "self-insurance" because the withdrawal always generates income. Withdrawing from a taxable account is also a taxable event, with the tax impact dependent on cap gain/loss from the withdrawal. From a tax standpoint, holding LTC "self-insurance" in a TDA is usually a better choice than holding it in a taxable account. Aging increases the likelihood of needing LTC; aging drains the TDA account.
Of course. And is the taxation difference between the accounts really a big enough difference to result in failure?
RetiredCSProf
Posts: 1228
Joined: Tue Feb 28, 2017 3:59 pm

Re: LTC Strategies - Options and what are people doing?

Post by RetiredCSProf »

Does "self-insure" imply that you have a plan for how you will cover LTC expenses? Or does it imply that you will "muddle through"?

At age 99, my Mom was quickly running through her savings to pay for assisted-living and round-the-clock aides. She needed help with every aspect of living. We needed to sell her house, but my sister had moved her daughter's family into my Mom's house -- she was paying no rent. My niece is still angry at me for telling her that she needed to vacate my Mom's house so that we could sell it. Life can get messy without a plan.
markcoop
Posts: 1516
Joined: Fri Mar 02, 2007 7:36 am

Re: LTC Strategies - Options and what are people doing?

Post by markcoop »

Similar to the OP, this is one area I have spent the least amount of time thinking/preparing for. I am 55 and did price out some policies a couple of years ago. The cost was just so high and heard many complaining about premium increases. I decided to pass at the time. My take on it for us: We have no family history of needing such services. We have saved a decent amount for retirement and believe we are within the bonds to consider self-insuring. I am pretty sure we would do anything not to be put in a long term care facility. I do understand that there are circumstance where you really don't have a choice. I will continue to loosely monitor this situation, but I do believe it is the one hole in my plan. I do think this a big problem in this country and some alternatives will emerge in the future.
Mark
iamblessed
Posts: 1808
Joined: Sat Jun 09, 2018 11:52 am
Location: St. Louis

Re: LTC Strategies - Options and what are people doing?

Post by iamblessed »

ResearchMed wrote: Sun Nov 21, 2021 9:39 am
MrCheapo wrote: Sun Nov 21, 2021 9:10 am ii) Seems like the best route but given this table https://acl.gov/ltc/basic-needs/how-muc ... l-you-need how much money would be reasonable to put away? This table https://www.calperslongtermcare.com/Home/CostOfCare assumes about $10K a month so $120K a year for private full assistance. Does that sound reasonable?
You should take a look at a few of the types of facilities that are actually ones that you might end up at, rather than rely upon some state averages. The differences in facilities can be considerable, in both cost and quality of care.

If you find an "average cost" facility to be one that you would find suitable for yourself, then that's fine.
But if you notice that you would strongly prefer a higher priced facility (or would definitely NOT want an "average priced" facility), then you should know this enough in advance to plan accordingly. That could be to get enough LTC insurance or to save enough for an expected stay.

Also keep in mind that it can make a huge difference having enough money to "get into" a nicer facility if you can find one that will "not kick you out" if you run out of money, but will instead switch you to Medicaid and accept that amount.
These usually have some financial vetting, to rule out those who arrive with very little money and would run out almost right away, etc.

The "place" that DH and I have selected is about double the state average. But yes, they do "keep one" once one is "in".
We got to know this place inside out after MIL lived there for several years, so that helps. It's also a non-profit, associated vaguely with a religious/cultural background (but welcome anyone/everyone) and, more importantly, affiliated with a major nearby teaching hospital and medical school. (It happens to be the University where DH and I have been at since the 1970's, so we have a bit more background there, too.)

The association with the medical school/etc., is something we find particularly helpful, as it includes the teaching hospital where we've been getting our regular medical care for many years.

VISITING a place, several times, including unannounced visits, can be very important. Even better is so know someone living there, to get more of a feel for the place from the inside, if possible.
But just visiting can also sometimes give some surprisingly quick feedback.

RM
I like this idea. How much money would a person need to get into one of the one's that don't kick you out?
User avatar
ResearchMed
Posts: 16795
Joined: Fri Dec 26, 2008 10:25 pm

Re: LTC Strategies - Options and what are people doing?

Post by ResearchMed »

iamblessed wrote: Mon Nov 22, 2021 1:18 pm
ResearchMed wrote: Sun Nov 21, 2021 9:39 am
MrCheapo wrote: Sun Nov 21, 2021 9:10 am ii) Seems like the best route but given this table https://acl.gov/ltc/basic-needs/how-muc ... l-you-need how much money would be reasonable to put away? This table https://www.calperslongtermcare.com/Home/CostOfCare assumes about $10K a month so $120K a year for private full assistance. Does that sound reasonable?
You should take a look at a few of the types of facilities that are actually ones that you might end up at, rather than rely upon some state averages. The differences in facilities can be considerable, in both cost and quality of care.

If you find an "average cost" facility to be one that you would find suitable for yourself, then that's fine.
But if you notice that you would strongly prefer a higher priced facility (or would definitely NOT want an "average priced" facility), then you should know this enough in advance to plan accordingly. That could be to get enough LTC insurance or to save enough for an expected stay.

Also keep in mind that it can make a huge difference having enough money to "get into" a nicer facility if you can find one that will "not kick you out" if you run out of money, but will instead switch you to Medicaid and accept that amount.
These usually have some financial vetting, to rule out those who arrive with very little money and would run out almost right away, etc.

The "place" that DH and I have selected is about double the state average. But yes, they do "keep one" once one is "in".
We got to know this place inside out after MIL lived there for several years, so that helps. It's also a non-profit, associated vaguely with a religious/cultural background (but welcome anyone/everyone) and, more importantly, affiliated with a major nearby teaching hospital and medical school. (It happens to be the University where DH and I have been at since the 1970's, so we have a bit more background there, too.)

The association with the medical school/etc., is something we find particularly helpful, as it includes the teaching hospital where we've been getting our regular medical care for many years.

VISITING a place, several times, including unannounced visits, can be very important. Even better is so know someone living there, to get more of a feel for the place from the inside, if possible.
But just visiting can also sometimes give some surprisingly quick feedback.

RM
I like this idea. How much money would a person need to get into one of the one's that don't kick you out?
I assume this varies by facility and by the relative LTC costs in the area.
It's also likely to be a function of one's age and health status... that is... how long are you likely to be needing care, etc.

This is something to discuss with each facility you might be considering.
They probably each have some sort of software/algorithm that will help them with such decisions unless there is obviously plenty of money... or not nearly enough.

RM
This signature is a placebo. You are in the control group.
ncbill
Posts: 2053
Joined: Sun Jul 06, 2008 4:03 pm
Location: Western NC

Re: LTC Strategies - Options and what are people doing?

Post by ncbill »

Tough to find insurance that keeps up with the increasing costs.

E.g., 20 years ago when mom needed SNF care, facilities here charged ~$125/day for private pay...Medicaid reimbursed at $90/day back then.

Just a couple of years ago the SNF I used for another relative charged ~$275/day for private pay...IIRC, Medicaid now reimburses $200/day for SNF.

And I live in a relatively LCOL area.
User avatar
thursdaysd
Posts: 126
Joined: Tue May 13, 2014 10:55 am
Location: NC
Contact:

Re: LTC Strategies - Options and what are people doing?

Post by thursdaysd »

ncbill wrote: Mon Nov 22, 2021 2:40 pm Tough to find insurance that keeps up with the increasing costs.

E.g., 20 years ago when mom needed SNF care, facilities here charged ~$125/day for private pay...Medicaid reimbursed at $90/day back then.

Just a couple of years ago the SNF I used for another relative charged ~$275/day for private pay...IIRC, Medicaid now reimburses $200/day for SNF.

And I live in a relatively LCOL area.
The CCRC I am planning to move to is currently charging $322/day for Skilled Nursing and $6,217/month for Assisted Living. I am sure there will be a noticeable increase next year. This is a somewhat LCOL area, people moving from California are stunned by how much house they can buy, while long term residents are amazed by the increase over the last year.
Thursday's child has far to go
User avatar
Leif
Posts: 3705
Joined: Wed Sep 19, 2007 4:15 pm

Re: LTC Strategies - Options and what are people doing?

Post by Leif »

I'm going to self-insure. Why? I'm guessing that many that insure are in relative poor health and/or have concerning family history. That is probably why LTC is so expensive.

I do have what I believe is sufficient funds in my tIRA. If needed my plan is to pull from my tIRA. With the medical deduction it makes my tIRA into triple tax free. No tax on the contribution, no tax on growth, and no or reduced tax on withdrawal from my tIRA due to the medical deduction. If it turns out I don't need it then my beneficiaries received the money instead of the insurance company. If I do need it then my beneficiaries will need to make do with a bit less. But, looking on the bright side, less money in the tIRA means less taxes over the 10 years for withdrawal. At least I'm not a burden to them, as in option 3
Last edited by Leif on Mon Nov 22, 2021 4:03 pm, edited 2 times in total.
User avatar
AllMostThere
Posts: 886
Joined: Sat Dec 31, 2016 1:04 pm

Re: LTC Strategies - Options and what are people doing?

Post by AllMostThere »

This is always a concern for those of us who are planners. DW & I are not insurable due to multiple pre-existing medical conditions. We plan to self-insure by reserving ~ $250K each for this eventuality. Seems to be a common theme and $$ amount here.
It is not about how much you make; it is about how much you keep and how well you invest it. - Author Unknown | Dream as if you’ll live forever. Live as if you’ll die today. - Author James Dean
iamblessed
Posts: 1808
Joined: Sat Jun 09, 2018 11:52 am
Location: St. Louis

Re: LTC Strategies - Options and what are people doing?

Post by iamblessed »

ResearchMed wrote: Mon Nov 22, 2021 1:41 pm
iamblessed wrote: Mon Nov 22, 2021 1:18 pm
ResearchMed wrote: Sun Nov 21, 2021 9:39 am
MrCheapo wrote: Sun Nov 21, 2021 9:10 am ii) Seems like the best route but given this table https://acl.gov/ltc/basic-needs/how-muc ... l-you-need how much money would be reasonable to put away? This table https://www.calperslongtermcare.com/Home/CostOfCare assumes about $10K a month so $120K a year for private full assistance. Does that sound reasonable?
You should take a look at a few of the types of facilities that are actually ones that you might end up at, rather than rely upon some state averages. The differences in facilities can be considerable, in both cost and quality of care.

If you find an "average cost" facility to be one that you would find suitable for yourself, then that's fine.
But if you notice that you would strongly prefer a higher priced facility (or would definitely NOT want an "average priced" facility), then you should know this enough in advance to plan accordingly. That could be to get enough LTC insurance or to save enough for an expected stay.

Also keep in mind that it can make a huge difference having enough money to "get into" a nicer facility if you can find one that will "not kick you out" if you run out of money, but will instead switch you to Medicaid and accept that amount.
These usually have some financial vetting, to rule out those who arrive with very little money and would run out almost right away, etc.

The "place" that DH and I have selected is about double the state average. But yes, they do "keep one" once one is "in".
We got to know this place inside out after MIL lived there for several years, so that helps. It's also a non-profit, associated vaguely with a religious/cultural background (but welcome anyone/everyone) and, more importantly, affiliated with a major nearby teaching hospital and medical school. (It happens to be the University where DH and I have been at since the 1970's, so we have a bit more background there, too.)

The association with the medical school/etc., is something we find particularly helpful, as it includes the teaching hospital where we've been getting our regular medical care for many years.

VISITING a place, several times, including unannounced visits, can be very important. Even better is so know someone living there, to get more of a feel for the place from the inside, if possible.
But just visiting can also sometimes give some surprisingly quick feedback.

RM
I like this idea. How much money would a person need to get into one of the one's that don't kick you out?
I assume this varies by facility and by the relative LTC costs in the area.
It's also likely to be a function of one's age and health status... that is... how long are you likely to be needing care, etc.

This is something to discuss with each facility you might be considering.
They probably each have some sort of software/algorithm that will help them with such decisions unless there is obviously plenty of money... or not nearly enough.

RM
True but shot me a number you have heard in your area. A ballpark number will do.
Gnirk
Posts: 1740
Joined: Sun Sep 09, 2012 3:11 am
Location: South Puget Sound

Re: LTC Strategies - Options and what are people doing?

Post by Gnirk »

I am self-insuring. I anticipate full care at Around $120,000 per year. I keep enough in bond funds to cover the difference between my SS and small pension for about 15 years, including inflation. That seems high, but we have a history of Alzheimer’s and longevity in our family and I’ve had relatives in long term care for over 15 years.
Topic Author
MrCheapo
Posts: 1469
Joined: Tue Dec 22, 2020 2:43 pm

My conclusion

Post by MrCheapo »

Thanks for the wonderful feedback. I've decided to self insure.

My reasoning (based on people's comments) were that:

a) Premiums can be expensive when you get to your 50s with no protection against further rate hikes
b) The people who choose LTC typically are going to need it so premiums are inevitably going to go up.
c) My family does not have a significant history of Alzheimer's or any cognitive decline issues so my time in LTC will most likely be limited.

Now for the drastic part. I hope I don't offend people, but I really hope dying with dignity is an option when I get much older.
User avatar
AnnetteLouisan
Posts: 7261
Joined: Sat Sep 18, 2021 10:16 pm
Location: New York, NY

Re: LTC Strategies - Options and what are people doing?

Post by AnnetteLouisan »

I have low cost/subsidized LTCi through work, John Hancock $63/mo. I started early in my mid 40s due to health conditions and no underwriting offers.

I was advised by the insurance rep whom I grilled at length not to get the inflation protection option, but instead get a high daily coverage rate. I was told that this limits your premium increases and in fact others had large increases and I did not so far, possibly due to my age but it could be the inflation protection decline strategy.

I’m in that middle group that has funds to protect but not enough to confidently self insure. I have longevity in my family and I’m told that - paradoxically, the healthier you are and the longer you live, the MORE likely you are to need this type of care (a long gradual decline in your 90s or later is actually the best outcome among many, a luxury if you will). Also as a single person with no dependents in a VHCOLA, a care plan for infirmity seems advisable if affordable. Once I figured all this out it was an easy choice for me.

I’ve heard a range of views on LTCi. My maman ancienne has it and kept it despite premium increases because she LFBHM. One of her poorer friends had to cancel in her 80s due to the premium increases. I think she is quite bitter about that but she and her daughter LATM and have for a while… not judging just noting yet another attendant consequence.

An affluent cousin of mine had wonderful care at a high end assisted living residence run by one of the luxury hotel chains. She passed in her mid 90s but was comfortable and lived in dignity with medical supervision. Other friends of mine tell similar stories about the high quality care in private facilities available with LTCI, but naturally experiences are all over the map.
Last edited by AnnetteLouisan on Sat Nov 27, 2021 1:45 pm, edited 2 times in total.
User avatar
JoeRetire
Posts: 15381
Joined: Tue Jan 16, 2018 1:44 pm

Re: LTC Strategies - Options and what are people doing?

Post by JoeRetire »

AnnetteLouisan wrote: Sat Nov 27, 2021 9:13 am I have low cost/subsidized LTCi through work, John Hancock $63/mo. I started early in my mid 40s due to health conditions and no underwriting offers.
Great!
I was advised by the insurance rep whom I grilled at length not to get the inflation protection option, but instead get a high daily coverage rate.
Yikes!
What is your (fixed) daily coverage rate?
This isn't just my wallet. It's an organizer, a memory and an old friend.
User avatar
dwickenh
Posts: 2304
Joined: Sun Jan 04, 2015 8:45 pm
Location: Hills of Eastern Tennessee

Re: LTC Strategies - Options and what are people doing?

Post by dwickenh »

Self insuring may not be as expensive as suggested. SO's sister is in Long Term Care at 72000 per year but also has income of 5400.00 per month from pension, SS, investments, 2 small annuities. This leaves a shortfall of 600.00 per month not including spending money(200 per month is plenty it seems). It appears that saving 200,000 to 400,000 in conservative investments would have been a mistake in her case. She is 80 with health problems and life expectancy of less than 7 years. 10,000 per year for 7 years would total 70,000 needed for long term care. Every case is different, but I think the amounts to save for self insurance should take into account current income from other sources. Medical bills could add up to 5000 per year to the total.

Dan
The market is the most efficient mechanism anywhere in the world for transferring wealth from impatient people to patient people.” | — Warren Buffett
User avatar
AnnetteLouisan
Posts: 7261
Joined: Sat Sep 18, 2021 10:16 pm
Location: New York, NY

Re: LTC Strategies - Options and what are people doing?

Post by AnnetteLouisan »

JoeRetire wrote: Sat Nov 27, 2021 10:09 am
AnnetteLouisan wrote: Sat Nov 27, 2021 9:13 am I have low cost/subsidized LTCi through work, John Hancock $63/mo. I started early in my mid 40s due to health conditions and no underwriting offers.
Great!
I was advised by the insurance rep whom I grilled at length not to get the inflation protection option, but instead get a high daily coverage rate.
Yikes!
What is your (fixed) daily coverage rate?
$400 a day, which I now realize couldn’t possibly be enough. However there is an opt in periodically to increase coverage. I could check the box yes.

There are companies selling supplemental LTCI but I didn’t bite since it isn’t through work. I do have the highest possible LTD though.
Last edited by AnnetteLouisan on Sat Nov 27, 2021 10:50 am, edited 1 time in total.
7eight9
Posts: 2406
Joined: Fri May 17, 2019 7:11 pm

Re: LTC Strategies - Options and what are people doing?

Post by 7eight9 »

Long-term care abroad can be relatively affordable. This is a place in Thailand:

Ban Sabai Village, Chiang Mai care home resort. Full care services for seniors.
Offering soft care to full 24 hour ‘close care’.
We also provide specialist care for Alzheimer’s and other dementia.
Perfect for recuperation and rehab after a stroke.
With on site nursing this is the perfect nursing home to enjoy quality assisted living.
https://bansabairesorts.com/senior-care ... hiang-mai/

Pricing --- https://bansabairesorts.com/senior-care ... ce-prices/
I guess it all could be much worse. | They could be warming up my hearse.
chw
Posts: 1315
Joined: Thu May 24, 2012 4:22 pm

Re: LTC Strategies - Options and what are people doing?

Post by chw »

DW and I purchased LTC policies mid 50s through my employer. The premiums seemed very reasonable ($1,200/ year for both policies), and we’ve only had one modest increase in 10 years. I was able to get into the plan with no health statement, or health evaluation required (DW was required to do so). We probably have the resources to self insure depending on what stage of our life we may need it. We opted for a “middle of the road” daily benefit thinking the insurance could provide a buffer should one or both of us need LTC for a longer period of time than expected.

I think 10k/ month for LTC may work(or not) depending on where you will be living when entering a facility, and at what time period in the future, and what type of facility you may desire.

Both my parents share an apartment in an assisted living community (FL), and are paying almost 10k/month now. That figure includes some day to day nursing assistance for one parent. If one of these parents is moved to memory care, the total cost will likely be about 15k/month. The AL community for this price tag is in about the top 5th for all AL options nearby, but provides an excellent living environment for my parents. My parents had the foresight to purchase a LTC policy which has helped defray most of their LTC expense over the past 2 years. They considered letting I lapse due to premium increases, but are glad now they held onto the policy.
User avatar
TomatoTomahto
Posts: 17158
Joined: Mon Apr 11, 2011 1:48 pm

Re: LTC Strategies - Options and what are people doing?

Post by TomatoTomahto »

We had planned on aging in place, with our house made very senior friendly if the time comes: roll in showers, ADA compliant, suite for caregivers, power resilience, etc.

Then I read in today’s NYT: https://www.nytimes.com/2021/11/27/styl ... ticleShare. This would work if one or both of us needed more nursing than a live-in caregiver can provide. I am sure that more moderately priced options exist elsewhere.
I get the FI part but not the RE part of FIRE.
User avatar
JoeRetire
Posts: 15381
Joined: Tue Jan 16, 2018 1:44 pm

Re: LTC Strategies - Options and what are people doing?

Post by JoeRetire »

AnnetteLouisan wrote: Sat Nov 27, 2021 10:23 am
JoeRetire wrote: Sat Nov 27, 2021 10:09 am
AnnetteLouisan wrote: Sat Nov 27, 2021 9:13 am I have low cost/subsidized LTCi through work, John Hancock $63/mo. I started early in my mid 40s due to health conditions and no underwriting offers.
Great!
I was advised by the insurance rep whom I grilled at length not to get the inflation protection option, but instead get a high daily coverage rate.
Yikes!
What is your (fixed) daily coverage rate?
$400 a day, which I now realize couldn’t possibly be enough. However there is an opt in periodically to increase coverage. I could check the box yes.
I wouldn't ever purchase LTCi without an inflation rider. $400/day now is good. But in 20, 30, or 40 years when you are more likely to need the benefits it seems unlikely to be enough, given inflation and the other increases in healthcare costs.
This isn't just my wallet. It's an organizer, a memory and an old friend.
ChrisC
Posts: 1475
Joined: Tue Jun 19, 2012 9:10 am
Location: North Carolina

Re: LTC Strategies - Options and what are people doing?

Post by ChrisC »

TomatoTomahto wrote: Sat Nov 27, 2021 1:23 pm We had planned on aging in place, with our house made very senior friendly if the time comes: roll in showers, ADA compliant, suite for caregivers, power resilience, etc.

Then I read in today’s NYT: https://www.nytimes.com/2021/11/27/styl ... ticleShare. This would work if one or both of us needed more nursing than a live-in caregiver can provide. I am sure that more moderately priced options exist elsewhere.
If one or both of you need skilled nursing care, aging in place and home health care won't really work unless you can afford a mini-hospital room in your house, with a RN and suitable medical equipment with backup supply of utilities ( I think I read before you have solar panels but you might want to pre-order a Ford 150 Lightning to reverse power the home as another back-up). Seriously, our Plan A is to age-in-place, and we're in a home that we can do that as long as one of us doesn't get major health problems requiring more than the help of a live-in-caregiver or home health care. But if we cross over to major memory care or skilled nursing care, I just don't think our house is the appropriate place for both of us to be there,when one of us needs that level of care. That's one of the reasons our Plan B is the CCRC, but as we inch closer to 75 (we're 5 and 7 years short), the CCRCs, with active lifestyles are looking better and better to us. And I'm thinking that the CCRC industry itself is offering more variety such as the upscale CCRC reflected in the NY Times article and there are certainly more moderately priced options for affluent, but not at the mega-HNW levels.

We recently attended a presentation for a unique CCRC in our area, where this CCRC under development would be built into an existing faith community campus. https://generationsatshalompark.com/ It's likely we'll see more unique CCRC offerings in the future with the aging Boomer population.
TN_Boy
Posts: 4134
Joined: Sat Jan 17, 2009 11:51 am

Re: LTC Strategies - Options and what are people doing?

Post by TN_Boy »

TomatoTomahto wrote: Sat Nov 27, 2021 1:23 pm We had planned on aging in place, with our house made very senior friendly if the time comes: roll in showers, ADA compliant, suite for caregivers, power resilience, etc.

Then I read in today’s NYT: https://www.nytimes.com/2021/11/27/styl ... ticleShare. This would work if one or both of us needed more nursing than a live-in caregiver can provide. I am sure that more moderately priced options exist elsewhere.
Dementia can blow up both "aging in place" hopes and planned residence at "nicer" senior communities. I cannot tell from the article, and perhaps I am wrong*, but I have a deep suspicion that places like the one mentioned might not want/be able to handle some dementia behaviors. The facility might have troubles ... and other residents might not appreciate some dementia behaviors. Yes, when you are in assisted living they can and will ask you to leave in some situations .... which can include being disruptive to other residents.

Any serious plan for LTC should include the very distinct possibility that you cannot stay at home. If you have the money to pay for 24x7 caretakers, you can handle most (not all) situations at home, but if you don't, aging in place may be impossible.

Even if you have money, a drawback of aging in place is that you and/or spouse may wind up seeing only caretakers and people who come to visit, and you may find that people don't visit all that much. A good care facility may provide better social opportunities, which I assume is why the linked article caught your eye.

* actually probably not as I see this text in the article:
These upscale retirement homes cater to the affluent end of the “the silver tsunami” — the coming wave of aging baby boomers who are still socially and culturally active, and who have become accustomed to a certain quality of life
Bold part is mine. They are not catering to people who are not reasonably high functioning.
User avatar
TomatoTomahto
Posts: 17158
Joined: Mon Apr 11, 2011 1:48 pm

Re: LTC Strategies - Options and what are people doing?

Post by TomatoTomahto »

ChrisC wrote: Sat Nov 27, 2021 4:10 pm If one or both of you need skilled nursing care, aging in place and home health care won't really work unless you can afford a mini-hospital room in your house, with a RN and suitable medical equipment with backup supply of utilities ( I think I read before you have solar panels but you might want to pre-order a Ford 150 Lightning to reverse power the home as another back-up).
Unless our debility is sudden (eg, accident), I would expect a gradual decline with plenty of time to make arrangements for one/both of us out of our home. For an acute issue, well, our kids can help us get situated. As for a mini-hospital in our home, it depends, but we are relatively well prepared and I’d really much rather die at home.

Re utilities, we have quite a bit of redundancy: two wells, gobs of solar panels, 52 kWh of batteries (and an additional 90 kWh locked in our Tesla), and 3 generators in case the grid is out, the batteries are drained, and the sun goes awol. House is all electric except for the generators, which I hope to never use aside from the weekly test.
I get the FI part but not the RE part of FIRE.
ROIGuy
Posts: 2452
Joined: Sun May 08, 2016 10:10 am

Re: LTC Strategies - Options and what are people doing?

Post by ROIGuy »

Is there an age bracket and years needing LTC chart?
Post Reply