{{ An index introduced this year by Milliman, a consulting and actuarial firm that advises insurers and governments, aims to help people plan for the cost of care. The firm estimates that a 65-year-old would need $135,000 today to cover the average expected future lifetime costs of long-term care.
The cost, however, varies by factors like sex, geography and length of care. “There are a wide range of outcomes,” said Chris Giese, a principal at Milliman and a co-author of the index. The average amount needed now for someone who requires less than a year of long-term care is just $30,000, but it rises to $665,000 should that person need five years or more of care. }}
When I did a financial analysis on LTC insurance 30 years ago, I found that the costs were high and there was too much opportunity for the insurance company to cheat you out of the coverage you paid for. Thus, I invested the premiums myself and cut the “skim, scam and fraud” of the insurer out of the transaction. I now have a multi-million dollar fund to cover what’s required, though I suspect I’ll choose euthanasia if and when the time comes.
Note: WA State started a LTC insurance plan funded by a 0.58% contribution of your wage & salary income a few years ago. I haven’t done the arithmetic on it, but I suspect you’d be better off self insuring.
Google gives this answer– “The average stay in long-term care varies by facility type and gender, generally ranging from 1 to 3.7 years. Women average 3.7 years, while men average 2.2 years. Nursing home stays average approximately 485 days (1.3 years), with 57% lasting 100 days or longer, and assisted living stays average roughly 22–28 months.”
Many never collect a dime on their policy. You are best off to self insure if you have $1MM in assets to spend. That’s $1000/day for 3 years. But those with Alzheimer’s might require more.
Need for long term care insurance might be greater if spouse in nursing home depletes resources needed for care of the survivor. Elder attorney can address this issue.
Those retirement communities who offer three stage care often have fine print in their 100 page contract assuming you have long term care insurance to cover costs and requiring you to pay extra for uninsured expenses.
Rates keep going up making policies unaffordable. Getting your money back in benefits can be a challenge.
You don’t. And LTC insurance policies typically have a fixed period for benefits.
For example, here is a calculator that tells me the cost of LTC insurance for a 55-yr-old with a $300/day benefit, inflation protection, and a 3-year benefit period would be about $479/month ($5,748/year).
Bounce that up to a lifetime benefit, and it’s $815/month ($9,780/year)
And then when it’s time to make a claim, you’re fighting with an insurance company.
Our company offered a LTC bennie. We were able to lock in a fixed price (in our early 50s, when they started offering the benefit) that would last the rest of our lives. No further underwriting.
It does have a limit on possible payouts, but it is so cheap it made sense. And now with 1poormom giving me a family history of dementia, I figure it’s a 50/50 shot that I end up in memory care at some point. Assuming I don’t have the courage to end it before that point. Which I won’t know until I get there (you think you would have the guts, but you never really know until the time arrives).