LTC 101: Overview Providers- Cost - Duration of Care

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Much of Home Care is provided by family and friends.  Home Care services provided by an agency can assist the patient in dressing, bathing, transferring, toileting and eating.  They can cue the patient when it's time to take their medication.  Home care givers are prohibited in performing assistance in taking medication such as giving injections or providing medical support.

Patients who receive proper care at home will delay or even prevent the necessity of a long term facility stay.   

 Assisted Living is the next level of care.  Two types of Residential Care Facilities are Board and Care, and Assisted Living Facilities. They provide a secure style of living, offering housekeeping, and meal and social services in an independent setting.  Residents can also receive assistance with, bathing, dressing and transferring.  ALF's can also provide supervision for the residents with cognitive problems.

The following illustrates how cost of care can vary depending on Location, Location, Location.

Hourly Care Giver services at home are between $20-$25 an hour requiring a minimum of 4 hrs. 6 hrs of supervision at home 5 days a week can cost $2,400 to $3,000 a month

Assisted living with 6 to 9 services (activities of daily living) provided (Standard) $3,200 a month With Nursing Home semi-private room average cost in CA being $260 a day would be $7,800  a month or $93,600 a year. 

The STRESS of caring for a spouse or a parent is huge, and impossible to calculate.  However we can look at the financial impact.

 The following illustration shows LTCi claims in the year 2009.

Fact is the 70% of those 65 or older will require LTC assistance.   54% will require more than a year of care, with the average claim duration being 3.8 years.  

 Genworth Claims Experience 2010

LTC 101: Analysis of Long Term Care Insurance

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My father loved the game of golf.  I learned from his  tutelage, of the game, that if you over think the complexities of your swing you will "duff" the shot.   Deciding on long term care is similar.  Analysis of all the solution one can get loosed in the details. Afraid of making a mistake. Decide to do nothing.   

There are many variables that determine the pricing of LTCi.  I will discuss many of these features in detail in other postings.   

 Of the many factors that effect the availability and price of LTCi.  the most important is ones health."Money Just Pays for Long-Term Care Insurance - Health buys it!".  Age is the next factor.  Companies use ones actual age. Premiums increase after age 50 by 6 to 9% a year.  All LTCi policies are "Guaranteed Renewable" which means the company can never cancel your coverage as long as premiums are paid.  They can, however, increase the premium by class with state approval.

When I was young and first married I asked my fathers " When is the best time to buy a house?"  "When you can afford it." he replied.    Same is true with LTCi.  You will never be younger and probably not healthier than you are today.  Susie Orman an advocate for LTCi now advises "before the age of 58".

Schug The LTC Guy

LTC 101: Care Giving (under construction)

LTC Insurance is Changing

     This blog does not endorse any LTCi company.  The best LTC policy is the one enforce at time of claim.  It is my cardinal rule not to discuss commission.  If you are selling LTCi to get rich, you'll be disappointed.  My purpose is to inform, educate and comment on Long Term Care and the Long-Term Care insurance industry that I have been dedicated to for over 18 years.
     I have been witness to a lot of changes as this industry has evolved and matures.  The need for coverage has never been stronger.  Due to the economic environment of prolonged historically low interest rates and the LTCi unique industry dynamics, companies have made independent decisions on how to react to the market.    This year Prudential left.  Genworth and TransAmerica are in the process of making fundamental changes to NEW business being sold.  It is important to note that until the States approve the changes requested they WILL NOT be in effect in that state. As always producers check with your marketer on the current status of the changes that are occurring.


    Genworth has announced:

• Elimination of Preferred discounts  (20% single / 10% for couples)
• Couples discounts to be reduced:
•  Two apply two issued from 40% to 20% 
• Two apply one issued from 25% to 10%

 Genworth will also be eliminating the sale of Unlimited Benefits (expected) and limited payment options


    TransAmerica has announced:

• Rate increase of 15% across the board in all States
• Spousal discount reduced 
• Two apply two issued from 30% to 20%
• Only one married spouse applies from 15% to 10%

TransAmerica like Genworth will be eliminating the sale of Unlimited Benefits and limited payment options.


My question to the industry is when our economy improves will we see a decrease in issued policy premiums?
Schug The LTC Guy

LTC 101: It Gets Personal

I received this letter from my cousin, Marilyn, who lives in Indiana. She writes about our Aunt Donna who is widowed in her early 80’s with Alzheimer’s disease, living alone in North Carolina.

Marilyn Kruger's painting is used as the background for the blog

            “But at Aunt Donna’s –not so much fun- the twenty eight year old “handyman” (who incidentally inherits the whole estate when she dies) who is “supposedly” looking after her was NOT getting the job done.  Aunt Donna’s refrigerator was deplorable.  I spent one morning cleaning it out and throwing out rotten food & petrified remains- cleaning out the pantry-throwing out moldy syrup-Blue Furry Jam.  Another day we washed her hair … She is not capable of making decisions about herself on personal hygiene-The House Keeper??? I did 9 loads of laundry (she had worn clothes and hung them back up in her closet dirty) – Lord knows when the last time her bed had been changed-I stripped it all-the microwave was filthy-She had put dirty dishes back in the cupboard-Get the picture???? Makes me wonder what she does. Anyway I got on the phone to the Lawyer/Estate Manager and made unhappy noises and he was going to set up a companion/ladies maid to come in two days a week to start with to take care of her personal needs. He was also setting up “Meals on Wheels”, because she is living on Ensure & Debbie cakes…

            Her Student, Becky, (my aunt is an Artist) does not trust the handyman.  She is sure he’s more opportunistic than compassionate.

            It was so sad, Chuck, to see a woman who only six years ago was still vitally alive & in charge.  And now the vacant stare, shambling gait, “Lights on but no body Home”. She won’t wear her teeth and she can’t see well anymore and she has a phobia about getting in a car.  She will not leave the property, has a foot stopping fit when you try to force the issue.  So she hasn’t been to any kind of doctor in who knows when.”

The decisions to plan for ones long term care are very personal. Proper Care Management  can provide peace of mind to you and your loved ones.  

LTC 101: CARE MANAGEMENT (under construction)

The most important feature provided in a Long-Term Care Policy is Care Management.  A professional usually a Registered Nurse or sometimes a Social Worker.  One who assists the family in the planning and implementation of the patients care.  

Even if one does not have a policy it is so important the family seeks counseling from a professional.   

The Care Manager becomes the Coach to help the family manage the maze of services and facilities.  The help develop and implement a plan.  Counseling the family the best way to keep the patient as safe and independent as possible.  

Schug The LTC Guy

LTC Legal: Durable Power of Attorney & Medical Directive

Disclaimer: " I am not an attorney.  Any legal advice that I share, check with an attorney.  I am not responsible for anything I say".  Words like this I say in all my Long-Term Care CE classes.

Two vital documents are necessary in order for a loved one (family member or friend) to properly take care and act on your wishes they are : Durable Power of Attorney and a Medical Directive.  Both are legal documents that allows a person of your choice to make the Financial/legal and Medical decisions if/when due to accident, illness or cognitive impairment you are not competent to decide.  They may be included in a Will, or Living Trust.

A marriage license is not a valid document for this purpose.  Insurance companies and financial planners are bound by privacy laws so therefore cannot discuss or execute with any other party without a durable power of attorney.   Medical practitioners will continue to provide care unless you have executed and appointed a person, of your choice, to make these decisions.         

A doctor wrote a one line letter "...this patient is not mentally competent to make her own financial decisions"     Allowing my wife to take over her mothers finances and preserve what was left of her financial investments.

Later my mother in law was certified for Hospice Care.  Because of the Medical Directive she was allowed  to remain at our house and die with dignity with family at her bedside.  

LTC 101; Need and Cost of Care (Constantly Under Construction)

Cost of care should not only be measured in dollars.  How about the immeasurable amount of time and stress on the family and the primary Caregiver? 

The odds are high, 7 out of 10 will need long-term care in their lifetime.

The "big what if " comes after the age of 80.

The cost in dollars must be born by the family.  Most Government programs provide assistance for the poor and primarily in Nursing Homes (Medi-Cal in CA).  Home Care is usually preferred with informal care provided by the spouse or children.  

Planning and providing care at home falls mostly on women.  Will they be available?  

Schug the LTC Guy

LTC 101 Care Continuum / How Benefits Trigger

Generally long-term care refers to a wide range of of personal care and other services provided over an extended period of time (90 days) to people who need help with basic activities of daily living (ADL's) or who need supervision due to severe cognitive impairment.  This can occur due to aging (frailty),disease, or accident.

How Benefits Are Triggered

In 1996 Federal  Government passed the "Health Insurance Portability and Accountability Act" (HIPAA) that set the standards on how benefits would be triggered  for all Long-Term Care Insurance.  Either the need for "substantial assistance" in at least two of six ADL's (Bathing, Dressing, Transferring, Toileting, Continence and Eating). Or due to "severe" cognitive impairment needing "substantial supervision". 

• Substantial assistance meaning either in the form of "hands on assistance" or "standby assistance". 
• Severe cognitive impairment means a loss of intellectual capacity to the point that one is endangering himself or those around him
• Standards are certified by a licensed health care practitioner and meet the 90 day requirement.

Home Care
Traditionally Home Care begins at home with the support of family and friends.  With a plan of care provided by a "Care Manager" LTCi can provide reimbursement for the cost of.

• Personal Assistance provided by a  "Care Giver"
• Bathing, Dressing, Transferring
• Respite Care
• Homemaker Services
• Shopping/Driving
• Money Management
• Meal Preparation
• Medication Management
• Light Housework
• Home Health Care provided by a licensed medical  practitioner
• Hospice Care for the Terminally ill (Note: Long Term Care Insurance will coordinate with Medicare) 
• Adult Day Care provided in the community

Facility Care 

Home care is practical only for those with limited need for assistance - one that does not involve extensive medical treatment or continuous care or observation. Facility care is at times more appropriate in serving the patients needs. There are two types of  Care Facilities: Residential Care (RCF) and Skilled Nursing Facility (SNF) or Nursing Home. 

Assisted Living provides for a social environment with 24-hour supervision and assistance to residence who have minor medical problems and may or may not need help with bathing, dressing and transferring.  Some Assisted Living facilities provide safe secured areas for those who with mild to moderate cognitive impairment.   These communities offer private, semi-private or small apartments.  They typically provide social activities and a central dinning room.  They typically charge a monthly fee with additional services added depending  the level of care required.  

Board and Care facilities are converted single family homes providing assistance for up to six residents.  They provide “hands on care” with a more home-like atmosphere.  Some facilities off secure supervision and may also provide recreational and social activites.

Skilled Nuring Facility also referred to as nursing home, conversant hospitals or vocational rehab facility provide for 24 hour nursing services.  Many SNF’s off sub-acute care and specialized medical programs like: respiratory therapy services,ventilator care, tracheotomy care , IV services and Hospice.  Sage 3 -4 Alzeihmer’s  or dementia facilities are also licensed as SNF’s.

Summary: RCF’s provide a Social environment and can assist in providing three ADL’s  (Dressing, Bathing and Transferring).  SNF’s provide a Medical environment for patients who require medical assistance on a daily basis.

 SchugTheLTCGuy.com

LTC 101 Defining Long-Term Care

I will attempt to clear up the confusion about Long-Term Care insurance.  Having been involved with not only product sales but the education of  insurance Agents since 1994, my perspective is unique.

Long-Term Care is needed when due to: accident, illness, frailty or loss of cognitive ability creates the need of human assistance to remain  independent.   This care can be provided at home, in the community or in a facility.  Long Term Care insurance (LTCi) provides the funds to pay for care.  This is a very personal subject,which involves the family and  making choices that will determine the quality, affordability and availability of care.

Although thought to be  a senior insurance product,  care can be required at any age.  Long Term Care insurance must be obtained  before you require assistance.  My first lesson was: " Money just pays for it.  Health buys it."

Golf taught me that "over analysis lead to paralysis".   There are numerous options to help  fund your long-term care needs: saving, life insurance. annuities, depending on spouse and/or children, reverse mortgage or just do nothing and pray.  With so many choices do not fail to plan.  
7/19/12 SchugTheLTCGuy.com