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Reply to High nursing home bills squeeze insurers, driving rates up

http://www.cnbc.com/id/102530795 - 3/24/15

Sigh. Another LTC insurance bashing article hit this week. Here are some talking points if you get calls from clients or prospects:

As a national consultant for long-term care insurance since 1991, I can tell you there are a number of mistakes in this article. For example, ManuLife through John Hancock just introduced a new policy, and is not scaling back or trying to get out of the business as this article said. Further, the article focuses on nursing homes when less than 15% of long-term care happens there. Most people are never in a nursing home. Long-term care insurance pays for home care, adult day care and assisted living facilities, all of which are options to defer or eliminate nursing home care.

The article didn't give examples of premiums for couples but they are still far less than paying for LTC out-of-pocket. A policy that provides almost full coverage for a 55 year old couple with MedAmerica Insurance Company (the company that insures the New York state employees) is about $500 a month. Compare that to paying almost $5000 a month for an assisted living facility or for 10 hours a day of home care at $18-$20 an hour. And that's with the best inflation that will make the benefits double every 15 years for a person's lifetime.

The largest national meeting for LTC insurers was in Colorado Springs this week (ILTCI) and the actuaries believe the market has stabilized with only about 12% chance that today's new products will need rate increases anytime soon. The best hope for Medicaid is for more people to buy long-term care insurance to have money to pay for home and community services and not take dollars from state budgets for nursing home care. Most people don't know that if they buy a Long-Term Care Partnership policy which most carriers offer, they can protect their assets equal to the benefits paid out if they ever have to turn to Medicaid instead of spending most of their own money down to get Medicaid to pay. Plus, they get to be private pay as long as possible which provides many more choices for care.

We have to go with the best solution available today. I'd sure rather bet on long-term care insurance than bet on the federal or state government to pay for my long-term care.

Phyllis Shelton


LTC Consultants provides long-term care insurance training to agents and educates consumers with information about long term care insurance. This website contains reports and articles about caregiving, assisted living, nursing homes, aging, senior living and elder care, home health care and other long-term care related articles. Order Phyllis Shelton’s Protecting Your Family with Long-Term Care Insurance with articles about whether or not to self-insure or buy combo life insurance and annuity policies or a traditional LTC insurance plan. The book also contains ideas for people who don't qualify for LTC insurance such as Medicaid, life settlements, reverse mortgages, critical illness and also contains in-depth information about Medicare, Medicare Advantage and Medicare Supplements.


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