Category: Long-term care

Beware of steep premium increases on long-term care policies
As you age, it’s critical to plan for long-term care services and supports, including home or nursing home care. Many people end up qualifying for Medicaid, which covers these services. Others rely on the volunteer services of family and friends as well as local resources. The Wall Street Journal reports that people who rely on long-term care insurance policies are at risk; many of them are now facing steep premium increases.

As we have previously explained on Just Care, most of us will not benefit from a long-term care policy. People who buy long-term care policies are seeing their premiums rise sharply over time. The policies usually include “level premiums.” The problem is that insurers offering policies with level premiums still can increase their premiums substantially. And, you can end up with premiums for your long-term care insurance that are a lot more than you anticipated.

The long-term care insurance industry is not faring well, as more policyholders are filing for benefits than anticipated. As a result, 7.3 million people who hold policies, about 20 percent of people 65 and older, are being forced to choose between continuing their policies at a much higher premium or dropping their coverage.

Between 2016 and 2018, CNA Financial Corp. has almost doubled its annual premium for long-term-care insurance. If people don’t find a way to come up with the additional money, they throw away all the money they had already invested in their policies. So, many are foregoing vacations and home maintenance or taking on additional work to cover their premiums.

The number of companies selling long-term care insurance has fallen from more than 100 in the 1980’s to about 12. And, the scope of coverage has narrowed significantly. A typical policy costs about $3,500 a year for a couple and pays out a minimum of $164,050 and a maximum, after 25 years, of $333,000. Not surprisingly, sales of policies in 2016 were fewer than 100,000, down more than 650,000 from a high of 750,000 in 2002.

One other warning: Long-term care insurance companies may wrongly deny people’s claims for coverage. The Wall Street Journal reports that one family was forced to sue a long-term care insurance company for denying a legitimate claim for in-home care. The family won, but it was “stressful.”

Medicare pays for only limited nursing home care and home care. People fortunate enough to have Medicaid, and that includes many middle-income people who spend down their assets, are guaranteed long-term care coverage, typically at home or in a nursing home. Some are lucky enough to participate in PACE, a program for all-inclusive care for the elderly.

Too many people struggle to get needed care. Long-term care can easily cost $100,000 a year, more than almost anyone can afford. Americans need the federal government to guarantee long-term care coverage to everyone.

Here’s more from Just Care:
December 19, 2018
Long-term disability insurance can be valuable
Today, it is difficult if not impossible to find an affordable insurance policy that will cover your likely long-term care needs after you retire. But, most people do not realize that buying long-term disability insurance to offset loss of income in the event of an illness or injury, while you’re still working, can be valuable. The cost tends to be low and the benefits extremely helpful.

Long-term disability insurance compensates working people who become critically ill or are injured and unable to continue to work. People typically use the coverage for close to three years. There is usually a block of time before the coverage kicks in, an “elimination period,” that may be three to six months or even longer. In some cases, people’s sick days can cover that elimination period.

Only about one in five working people today have long-term disability insurance. Most employers do not offer it. And, most people don’t think they will need it. So, they choose not to buy it, even though it costs about $22 a month on average. And, it can replace a good portion of people’s lost income.

People assume that they will not become disabled and unable to work. And, while the likelihood is not great that any individual working person will have a long- term disability, if you do become injured or seriously in, long-term disability insurance could cover 50-60 percent of your salary, according to Kaiser Health News.

The Social Security Administration predicts that one in four people who are 20 today will become disabled by the time they are 67.

If you buy long-term disability insurance yourself, with after tax income, and you receive long-term disability benefits, you will not pay taxes on the benefits. That said, if you decide to buy insurance, check out the policy carefully–what it pays, for how long, and under what circumstances, with what exclusions.

Here’s more from Just Care:
November 28, 2017
Help for people getting long-term care
It’s not clear when Congress will enact legislation that helps ensure everyone in America gets the long-term care services and supports they need. Certainly, not during this administration. But, if you are in a nursing home, assisted living facility or other long-term care facility, you should be able to get help from a long-term care ombudsman.

The Older Americans’ Act provides government-funded assistance with resident complaints and advocacy in every state for people in nursing homes and assisted living facilities through the Administration on Aging’s long-term care ombudsmen. According to Susan Jaffe at Kaiser Health News, in 2015, long-term care ombudsmen investigated 200,000 complaints, resolving more than half of them. Complaints range from issues with admissions and discharges, to the conditions of the living facilities, including the food and the noise levels, the rights of residents and abuse and neglect.

Volunteers do a lot of the leg work. The 8,155 volunteers have the right to visit any area of a long-term care facility whenever they want without permission. They can speak with residents as well, as they please. Their job is to alert residents to their rights and identify resident issues that need addressing, as well as to resolve them when possible. In some instances, they will call in state officials to assist them. Complaints are all treated as confidential.

Volunteers can be a health care buddy of sorts to residents who are not fit to speak for themselves and do not have family or friends to advocate for them. In addition to the volunteers, 2,257 paid staff at the Administration on Aging work as ombudsmen and supervise and advise the volunteers.

To be a volunteer requires attending training sessions and, at least in some states, passing a criminal background check, but no professional expertise. To learn more, please watch this video.

https://www.youtube.com/watch?v=6VRmetXQVEY&feature=youtu.be

Here’s more from Just Care:
May 9, 2017
7 questions you should answer before you turn 65
Everyone has lots of questions about their health and financial security as they age. Here are seven questions you should answer before you turn 65 with links to simple information to help you decide what to do:

1. Do you need to sign up for Medicare? Medicare provides health insurance for people 65 and over and people with disabilities, regardless of income. Whether to enroll in Medicare depends on whether you have employer coverage and what kind you have. (If you have employer coverage through your job or your partner’s job, click here to learn more.) If you do need Medicare:
- Enrollment in Medicare Part A, hospital insurance, and Part B, medical insurance, is generally automatic if you have signed up for Social Security. Part A is free if you or your spouse has paid into Medicare for at least 40 quarters. You pay the Part B premium unless you qualify for Medicaid. You need Medicare Part B if your employer coverage is no longer primary once you turn 65. (To avoid penalties for mistakenly turning down Part B, check with Social Security at 800-772-1213; you can also contact your local area agency on aging at 800-677-1116.)
- Understand your supplemental coverage options and how to choose among them. Medicare only covers about half of your health care costs. If you enroll in traditional Medicare (see below), you will want additional coverage, supplemental coverage, to fill gaps and limit your out-of-pocket costs. For an explanation of your options, click here. If you enroll in a Medicare Advantage plan, you cannot buy insurance to cover your deductibles and copays and other out-of-pocket costs.
2. Should you enroll in traditional Medicare or a Medicare Advantage plan? It depends on the kind of coverage that’s important to you and whether you want as much choice of doctors and hospitals as possible. It also depends on how much you are willing and able to pay to get the coverage you need. Most people choose traditional Medicare because of the enormous choice of doctors and hospitals it offers anywhere in the country. (Note: Some insurers are involuntarily enrolling people in their Medicare Advantage plans when they turn 65. Make sure you’re not involuntarily enrolled.)

3. Should you sign up for a Medicare Part D prescription drug plan? In most cases, yes, if you need drug coverage. But, you should understand the limits to that coverage and when your drugs will be covered. Here are six tips for keeping your drug costs down.

4.     What about Medicaid? Medicaid can pick up many of your health care costs that Medicare does not cover, including your Medicare premium, if your income is low. Whether you qualify for Medicaid might depend on where you live. You can have both Medicare and Medicaid. Here’s how they work together. And, here’s what you need to know about the ways Medicaid can help you. Even if you don’t qualify for Medicaid, here are five programs that lower your costs if you have Medicare.

5. When should you sign up for Social Security benefits (if you have not already done so) and what will your  Social Security benefits be when you retire? You should understand the benefits and risks of claiming Social Security early.

6.     Are you prepared if you need long-term services and supports? Today, two in five people with Medicare needing these services do not receive them.
7. Do you have a living will and medical power of attorney, Advance Directives? You should. Get help from Caring Connections.
October 3, 2015
Four things to think about before moving into a nursing home
Before moving into a nursing home, it’s important to do your homework and understand your rights and options.
1. Care: You have the right to receive whatever care you need to reach the highest reasonable level of functioning or so that your condition does not deteriorate. Medicaid patients have exactly the same rights to these services as everyone else in the nursing home so long as the nursing home accepts Medicaid patients. And all patients and their families have the right to help develop the care plan so that it is tailored to the resident’s needs
2. Choice: The nursing home must accommodate the resident’s preferences, whether they be to wake up late in the morning, to participate in an activity, to change schedules or to have family visit any time of the day or night.
3. Costs: Only the resident is required to be financially responsible for his or her care. The nursing home cannot force a family member to take responsibility. Medicare should pick up the costs for residents needing daily skilled nursing or therapy care who have been hospitalized for three days in the 30 days prior to admission, so long as the nursing home is Medicare-certified. If the nursing home says Medicare won’t pay, you still should insist that it submit the bill to Medicare.
4. Help: Every state has a long-term care ombudsman program to help ensure the nursing home provides you with the benefits and protections to which you are entitled free of charge. There are also websites where you can find nursing home ratings, but read them with caution.
For more information from the National Senior Citizens Law Center, click here.
March 27, 2015
Three tips to plan for long-term care
1. Protection: Because most of us will need long-term services and supports, it’s important to plan ahead for long-term care. If your income is low, Medicaid will pick up the cost of a nursing home stay. Depending upon the state you live in, you also might be able to spend down your income to qualify for Medicaid. If not, Medicare will at most only pick up the cost of a short-term stay in a skilled nursing facility depending on whether you meet the eligibility criteria. Most people rely on family members and friends to provide long-term care at no or low-cost.
2. Cost: If you cannot count on Medicaid or assistance from family and friends, you should plan ahead and set aside funds to pay for long-term care. For more information on costs, this AARP report shows that long-term care is unaffordable for many middle-income families. In 2013, an average nursing home stay cost $84,000 a year and the average cost of care in an assisted living facility was $42,000.
3. Long-term care insurance: Before buying long-term care insurance, keep in mind that the premiums are likely to rise dramatically over time. And, the coverage you buy today may be inadequate when you need it since health care costs likely will rise more than the 5 percent inflation protection in some policies. If you’re thinking of buying insurance, find out what will trigger your getting benefits—e.g. inability to bathe or to dress—as well as when those benefits will begin, how much you will receive in benefits daily, how long you will receive benefits, and the maximum amount you will receive in benefits.
For information on the costs and risks of buying a long-term care policy, read this article from Consumer Reports.

Learn the full range of issues you need to consider before buying a long-term care policy from California Health Advocates, the consumer experts on long-term care here. You can also get answers to frequently asked questions.

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Long-term care at a glance
November 14, 2014