Question on Long Term Care

[CALTCAgent]

I did get this quote from a Genworth agent. The advantages of the partnership policy does appeal to me as I do want to protect my retirement accounts.
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It is definitely to my advantage to have that program with my assets.

You mentioned your income was $200,000.

Do you expect that to stay the same when you might retire?

 

[Mr_Ed]

You mentioned your income was $200,000.

Do you expect that to stay the same when you might retire?

You will have little or no advantage to the Medi-Cal asset protection if:

1) Your home equity is over $750,000 when you apply for Medi-Cal.

2) Your total household income is over $200,000 when you apply for Medi-Cal.


If you expect that your income in retirement is going to be over $200,000 or that your home equity will be over $750,000, then there's little to no point in buying a California Partnership policy.

 

[Arthur Rudnick]

If you expect that your income in retirement is going to be over $200,000 or that your home equity will be over $750,000, then there's little to no point in buying a California Partnership policy.

Agreed.............

Keep in mind that once the benefits of your Partnership policy have been exhausted, you will be on Medicaid (Medi-CAL) and will have to adhere to Medicaid's rules & regulations as it relates to income.

Although a set amount of your assets will be protected, your income will not.

So, at your income, you'd most likely be required to contibute almost all of it towards the cost of your care.

And, for the most part, Medicaid will not pay for home care or assisted living. At the end of the day, once the benefits of your Partnership policy are exhausted, you'll most likely wind up in a nursing home.

You might want to re-think the purchase of a Partnership policy.

 

[GreenSky]

If you expect that your income in retirement is going to be over $200,000 or that your home equity will be over $750,000, then there's little to no point in buying a California Partnership policy.

Please explain the financial aspect of your quote.

Also, Partnership plans have other safeguards and consumer protections. Do you know the last time Genworth increased their premium on a CA partnership plan?

Rick

 

[Mr_Ed]

Please explain the financial aspect of your quote.

Also, Partnership plans have other safeguards and consumer protections. Do you know the last time Genworth increased their premium on a CA partnership plan?

Rick

Arthur explained it exactly how I would have explained it.

And, yes, there is the added value of requiring the DHCS to approve (or deny) any rate increases that may be approved by the CA DOI.

That's another reason why it was wholly irresponsible (and ignorant) of "someone" to tell a consumer who is planning on purchasing a California Partnership policy to expect a 60% to 90% premium increase.

mred

 

[csalter]

Agreed.............

Keep in mind that once the benefits of your Partnership policy have been exhausted, you will be on Medicaid (Medi-CAL) and will have to adhere to Medicaid's rules & regulations as it relates to income.

Although a set amount of your assets will be protected, your income will not.

So, at your income, you'd most likely be required to contibute almost all of it towards the cost of your care.

And, for the most part, Medicaid will not pay for home care or assisted living. At the end of the day, once the benefits of your Partnership policy are exhausted, you'll most likely wind up in a nursing home.

You might want to re-think the purchase of a Partnership policy.

There are a few things that I am thinking. The income is mine and my wife's combined. Right now it's about $240,000. I am looking at my half. My home is now under $750,000 because of the crash. I am not banking on it rising up to that amount by the time I retire in 8 years. I am aware that my house will be exempt and all but $2,000 of my income would be taken toward my nursing care.

I am thinking and hoping that if I live another 15 years with the 5% compounding I would have $578,000 in long term coverage and in 20 years I'd have 737,869 in long term coverage. These would help me to preserve money in my 403B and 457 accounts. I am hoping I won't need to go on medi-cal, but if something should happen I want my wife to be fine since I do have 14 years on her. My pension check will be 86% of my salary. However, my wife will only work until 50 so we will need funds for health care. I won't get Medicare until almost years after I retire. When I am 72, she will only be 56. I know money in her accounts and mine are looked at as community property so I must try to preserve as much as possible. I believe California does separate funds to ensure she would not have to go to pauperdom. If I get Alzheimer's and live a long time, my long term care benefits may run out and I will be in a nursing home. Medicaid may take most of my check, but my wife will not be a pauper and my kids will be able to still have some cash to bury me and some to give to have for themselves.

Is that the wrong thinking? Also, at least as of now, they are not throwing people out who start out paying through their insurance and then have to go to Medicaid. That is what I am lead to believe up until now.

 

[CALTCAgent]

There are a few things that I am thinking. The income is mine and my wife's combined. Right now it's about $240,000. I am looking at my half. My home is now under $750,000 because of the crash. I am not banking on it rising up to that amount by the time I retire in 8 years. I am aware that my house will be exempt and all but $2,000 of my income would be taken toward my nursing care.

I am thinking and hoping that if I live another 15 years with the 5% compounding I would have $578,000 in long term coverage and in 20 years I'd have 737,869 in long term coverage. These would help me to preserve money in my 403B and 457 accounts. I am hoping I won't need to go on medi-cal, but if something should happen I want my wife to be fine since I do have 14 years on her. My pension check will be 86% of my salary. However, my wife will only work until 50 so we will need funds for health care. I won't get Medicare until almost years after I retire. When I am 72, she will only be 56. I know money in her accounts and mine are looked at as community property so I must try to preserve as much as possible. I believe California does separate funds to ensure she would not have to go to pauperdom.

She can keep $113, 640 of "countable assets".

If I get Alzheimer's and live a long time, my long term care benefits may run out and I will be in a nursing home. Medicaid may take most of my check, but my wife will not be a pauper and my kids will be able to still have some cash to bury me and some to give to have for themselves.

Medicaid will not cover you. If you want to qualify for Medi-Cal, your income will go towards the nursing home except for the MMMNA. Your income in this example means the asset protection feature not valuable.

Is that the wrong thinking? Also, at least as of now, they are not throwing people out who start out paying through their insurance and then have to go to Medicaid. That is what I am lead to believe up until now.

Are you referring to a Medicare/Medi-Cal certified facility?

If your agent hasn't already covered these topics, I'd consider getting with an agent that can explain these things and compare plans for you, so you can decide what makes the most sense in your situation.

 

[csalter]

CALCAgent,

I did have an agent review this with me.

The way it was explained to me was that there is a dollar for dollar savings in the partnership program. Thus, if my long term care policy paid $400,000 for my care that $400,000 in assets could be protected from the State if I were to need Medi-Cal. Is that not right?

I know that the monthly minimum in income is about $2500.

How did you come up with that $113, 640 figure?
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You will have little or no advantage to the Medi-Cal asset protection if:

1) Your home equity is over $750,000 when you apply for Medi-Cal.

2) Your total household income is over $200,000 when you apply for Medi-Cal.


If you expect that your income in retirement is going to be over $200,000 or that your home equity will be over $750,000, then there's little to no point in buying a California Partnership policy.

My retirement income will not be over $200,000. We will have no debt except for mortgage during the first 8 years of my retirement. Our income will be reduced by one with my wife not working. However, we will withdraw from retirement accounts as needed, but we won't need the same level of income. . Our home will not have $750,000 in equity. Also, our income in retirement will be under $200,000.

So I am thinking that we can take advantage of the the asset protection from the partnership policy.

 

[CALTCAgent]

CALCAgent,

My retirement income will not be over $200,000. We will have no debt except for mortgage during the first 8 years of my retirement. Our income will be reduced by one with my wife not working. However, we will withdraw from retirement accounts as needed, but we won't need the same level of income. . Our home will not have $750,000 in equity. Also, our income in retirement will be under $200,000.

What will your retirement income be and from what sources?

What will your wife's retirement income be and from what sources?

What will the equity in your house be?

Based on the questions you are asking, you really need to find another agent that explains everything and can compare and contrast ALL of your options and make a good recommendation for you, IMO.

 

[csalter]

Our income will come from social security, pension, 401K, & 403B.

Wife's 401k with $400k, my 403B $200,000, no social security for me, pension of 100, 000 for me.

So if ltc partnership kicks in my assessts up to whatever I pay would be protected. Our income would be my pension and whatever withdrawals we would need from our retirement accounts.

I am thinking that my wife's 401K and my 403B would be protected. I am assuming that my pension would be reduced to $2500 a month that I could keep.

Is that not right