Cash LTCi

[somarco]

I am considering getting in to this market with what I consider to be a simple product. A few years ago I was exposed to MedAmerica and was quite impressed with the simplicity of the plan.

I can't say I am ready to pull the trigger on that market, but would appreciate feedback on the overall market and how the cash plans stack up against indemnity plans.

 

[Crabcake Johnny]

Long Term Care Insurance - American Association for LTC Insurance

could be a good resource

 

[somarco]

This is one I had looked at before. Seems to have some good info.

Long Term Care Insurance - Best Affordable Companies, Rate, Cost

 

[Crabcake Johnny]

Wow...what a great site!

 

[bluemarlin08]

What do you view are the major advantages of Medamerica?

 

[somarco]

They pay cash.

Do not require the claimant to provide receipts.

Pretty simple really.

Is this a problem?

I believe there may be other cash LTCi plans now. This was the first one I was exposed to.

 

[bluemarlin08]

I came across MedAmerica years ago, and wasn't impressed. If they pay cash, assuming one is in need of home care, which is what 80% of long term care is, how do they do their claims? Not trying to knock the product, just trying to understand how it works, do they pay up to the daily benefit assuming the claimant can show the inability to perform 2 of 6 ADL's? The difference in LTCi is all in how they pay claims for home care. Cash payments, or indemnity, in my experience, are always more expensive than other plans. I do a fair amount of LTCi, and not been exposed to any plans that are superior to the leaders in field, GE, Hancock, etc.

 

[somarco]

Qualifying for MedAmerica is the same as any other LTCi (or LTD) product. It requires doctor certification on the degree of incapacity.

It has been a while since I looked at the product, but I believe you can purchase a plan with half benefits or full benefits for home health. Claims are paid each month as long as the condition exists, regardless of the level of benefit or care.

You can purchase up to a $10,000 monthly benefit and many professional people will buy the coverage to supplement LTD, especially if they have maxed out their LTD benefit levels. The cash payout does not coordinate with LTD or SS.

Since you are buying a cash benefit, you can use the funds as you see fit. To pay for direct care, meds, companion assistance, etc.

What got me thinking about this again was an article in HIU about cash LTC. The article references those who go to places like Mexico where the cost of assisted living is often 80% less than in the states. A cash plan would be more than sufficient and the benefit would not be reduced just because the cost of care is less than in the US.

http://honeyleveen.com/pdf/the_case_for_cash_10_08.pdf

http://honeyleveen.com/pdf/leveen1004.pdf

 

[bluemarlin08]

Can you obtain a sample policy? Do you have a contact that you can get a proposal, one showing 100% benefits for HC AL and NH? I would love to have a cash plan policy to offer, assuming it is not overpriced. I agree the concept of using a cash/indemnity plan as a substitute for LTD for the older clients that still need LTD. If you want me to, I can ask my brother , a career GE agent for 20 years, to get me all the info they have on the company.

 

[Crabcake Johnny]

It's also a topic I'm interested in. I went to a LTC seminar just over a year ago that was a real eye-opener.

Not only do people needing LTC spend their assets but in a lot of cases their children spend their assets in an effort take take care of their mother/father.

I believe there's a five year look-back for transferring assets to the kids in an attempt to protect the estate. Father need LTC - sells the house to his son - goes on Medicaid - son can be sued to recover the assets (? check this)

It's also an issue that can tear families apart. In a lot of cases one of the siblings will take the parent in.

I've seen this play out. One sibling built an addition onto their house for their mother - took care of her for years. The other 3 kids promised to "help" - which never happened.

Issue was the will was never changed and upon her death the other kids where there with their hands out looking for their equal share.