When It Comes To Long-Term Care Insurance, Americans Don't Get It

Aug 27, 2015

  1. Arthur Rudnick

    Arthur Rudnick Moderator Moderator

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    New York
  2. Mr_Ed

    Mr_Ed Guru

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    New Jersey
    Wow! There's an awesome comment on that article that everyone must read. I've copied and pasted here below:

    Thank you, Howard, for your thought-provoking article and your invaluable perspective.
    Your last paragraph hits the nail on the head. You summarized:
    “People want lifetime insurance coverage but don’t want to pay for it. They don’t want mandatory government insurance but do want government subsidized private insurance.”
    The good news is that in many states they can get “lifetime insurance coverage” and “government subsidized private insurance” at an affordable price.
    Over 43 states have passed landmark legislation creating a “public-private” partnership to help the middle-class plan for long-term care.
    These states have approved for purchase a special type of long-term care insurance called a “long-term care partnership policy”.
    This program is designed to encourage the middle-class to purchase an amount of long-term care insurance that is equal to their assets. If the long-term care insurance policy runs out of benefits they can apply for Medicaid to pay for their care and all of their assets would be protected from Medicaid “spend down” and “estate recovery”.
    In other words, they get an unlimited amount of coverage while only having to pay for an amount of coverage that equals their net worth.
    What would the survey have found if they’d asked this question:
    If the government approved of special long-term care insurance policies that would protect all of your assets would you be willing to pay $100 per month for that coverage?
    I suspect the resounding answer would have been “YES!”
    The median net worth for those 55 and older is between $165,000 and $232,000 (according to a survey done by the Federal Reserve in 2013).
    A healthy, married couple, both age 61, could share $250,000 of long-term care insurance benefits for about $98 per month per person. (This would include the state-required inflation protection and a starting monthly benefit of $5,000 per person). If this couple exhausted their $250,000 of benefits, they would be able to protect $250,000 of their countable assets from Medicaid.
    Caveat: Rates for long-term care insurance vary significantly between insurance companies. Your readers should make sure they work with an LTC insurance specialist to find the best “LTC Partnership policy” in their state.
    Although these “LTC Partnership Programs” have been around for years, most people don’t know about them. I’ve told people about these programs and they’ve refused to believe me until I send them the link to the government webpage:

    Medicaid Estate Recovery | ASPE

    ‘Thanks, again, Howard, for your article and for all that you do to help our country face the “elder care” crisis.

    Sincerely, Scott A. Olson
    Mr_Ed, Aug 27, 2015
  3. Justin Bilyj

    Justin Bilyj Guru

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    That reminds me of a linkedin post I just saw...