LTCi - short & fat vs long & thin

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rustwood
Posts: 207
Joined: Mon Jan 17, 2022 2:05 pm

LTCi - short & fat vs long & thin

Post by rustwood »

Long term care insurance (LTCi) is sometimes categorized as either providing short and fat coverage - higher payouts for a shorter duration, or long and thin coverage- lower payouts for a longer duration. I understand that if you exceed your short and fat benefits, you would essentially exhaust any remaining assets and then medicaid would pay for your care; however, I'm not clear on what would happen if you have long and thin coverage and run out of assets to cover the difference between your coverage and the actual cost of care. Would Medicaid pay the difference or a portion thereof? If it is only a portion, is a higher-end facility likely to accept that amount?

If you ran out of funds after paying for 3+ years of care, I would hope you would have more/better options with partial insurance coverage than with no coverage at all, but perhaps that isn't actually the case. Presumably the magnitude of the shortfall would matter, so let's assume the insurance would cover at least 60% of the cost.

I've read many of the discussions of LTCi posted here and we could self insure for all of the reasonably likely scenarios, but I am considering buying LTCi primarily to provide coverage for the less likely (hopefully very unlikely) possibility of needing many years of care - hence my interest in long and thin coverage.
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