aging / helping aging parents / Long Term Care / Long Term Care Insurance

Long Term Care Insurance: Pros and Cons

“Stiff annual premium increases are making long-term-care insurance unaffordable for some retirees, and the high cost can be traced to few insurers remaining in the market, writes Darla Mercado. Yet, with annual nursing home costs approaching $100,000, such policies may be worth holding on to if possible, she writes.”
“Near-retirees wanting to shield themselves from nursing home costs face a quandary: Should they eat double-digit rate hikes for long-term care insurance, or should they walk away from their policy?
It’s a $97,455 question.” https://www.cnbc.com/2018/01/23/nursing-home-care-can-quickly-deplete-your-retirement-savings.html

On the Other Hand… The Wall Street Journal paints a negative view of the dramatically rising premium costs and shrinking pool of insurers.

Millions Bought Insurance to Cover Retirement Health Costs. Now They Face an Awful Choice

Battered by losses, long-term-care insurers hit policyholders with steep rate increases that many never saw coming

“Long-term-care insurance was supposed to help pay for nursing homes, assisted living and personal aides for tens of millions of Americans when they became unable to take care of themselves.
Now, though, the industry is in financial turmoil, causing misery for many of the 7.3 million people who own a long-term-care policy, equal to about a fifth of the U.S. population at least 65 years old. Steep rate increases that many policyholders never saw coming are confronting them with an awful choice: Come up with the money to pay more—or walk away from their coverage.”
“Never in our wildest imagination did we consider that the company would double the premium,” “says Sally Wylie, 67, a retired learning specialist who lives on Vinalhaven Island, Maine.” The article explains the problems in the industry and the dilemma facing consumers who have policies or are considering purchasing coverage.

Another factor to consider:

Immigrants play a big and growing part of providing care for America’s elderly parents and grandparents

 Gerald F. Seib writes in The Wall Street Journal, Jan. 22, 2018:
“We are a nation with an increasing population of elderly parents and grandparents needing care their families can’t offer directly. Immigrants play a big and growing part of providing that care. The question quietly running beneath the surface is whether the changes now being debated in immigration laws and policies will upset all that.”


Source: Financial Planning for Women