In these tough economic times, who wants to think of one more discretionary expense to add to the monthly budget? But, as this piece in the New York Times discusses, future long-term care costs for an individual could exceed $1 Million!
Long-term care insurance has been around for several decades, yet many people roll the dice as to whether they purchase it or not. Besides the statistics of one's chances of needed expensive nursing home care, the article also looks at the reasons we often choose not to obtain such protection.
While some excuses for not having insurance are incorrect or somewhat inaccurate (e.g, thinking Medicare will pay (which it doesn't), expecting our own savings to be sufficient, and counting on family members to care for us), "there is also a great deal of justified skeptism about the long-term care insurance industy."
On that skeptical side, some insurance companies are looking at raising their premiums by double-digit increases.
Wisconsin's Office of the Commissioner of Insurance (OCI) has a helpful guide on its website. Furthermore, Wisconsin is one of a number of states that offers Long-Term Care Insurance Partnership program to encourage the purchase of long-term care insurance by offering greater asset limits for Medicaid coverage. Search the OCI website for more information on all related topics.
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1 comment:
Great post, Mark.
Here’s some sound advice about long-term care insurance:
Buy a policy that meets the federal guidelines-that's called a "tax-qualified policy."
Buy a policy that meets your state's guidelines-that's called a "Partnership-qualified policy” (unless you live in CA or NY).
(Wisconsin has a GREAT LTC Partnership program.)
Buy a Daily Benefit that is high enough to cover most of the cost of care in your area.
If home care is important to you, make sure the policy allows for all of the Daily Benefit to be used for care at home.
As a general rule, buy a policy that has a "Policy Limit" that is equal to the amount of your net worth that you want to protect for yourself, spouse, or heirs.
If you’re healthy, you should probably purchase a policy on your own, rather than through your employer.
Lastly, shop around. LTC insurance premiums vary a lot from one company to the next. Your age, health, and choice of benefits have a big impact in determining the premium. Get quotes from at least 9 of the top companies before choosing your policy.
Scott A. Olson
www.LTCShop.com
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