My dad’s death last year not only made me and my siblings 40-something orphans, but it also marked the end of my parents’ Nursing Home Era (1998-2011). Until his death, either my mom or dad was in a nursing home for almost 11 years of that 13 year span.
My mom shelled out $500,000 cash over the years, and her place was neither shmancy nor fancy. My dad “only” paid $22,000 per year because he had Long Term Care Insurance cover most of it.
Long Term Care Insurance (LTCI) is insurance you buy to help pay for Nursing Home, Assisted Living, or In-Home Care should you ever need it. We did not have LTCI for my mom. We paid about $200/day for her care.
After my then 65 year old dad saw that first bill, he did what all shocked cartoon characters do. He lifted his jaw off the floor and put his eyeballs back in their respective sockets. Then he purchased an LTCI policy for himself, which he’d use 10 years later.
My dad’s LTCI saved him $114,000 over the 2+ years he was being cared for. Pretty sweet, right? Sounds like I’m doing a pitch to get LTCI. Not so fast.
I looked into getting a policy for myself five years ago. I saw how nursing homes devoured my parents’ life savings and thought it might be wise to get LTCI while I was young. The best deal I found was comparable coverage and pricing to my dad’s policy, but my I was only 42.
My beef with buying an LTCI policy, is that I did not find any company willing to guarantee that the monthly premium would not go up. I don’t recall any time in my life when I agreed to buy something where I could get charged more later at the seller’s whim.
In August 2008, my dad checked into the nursing home. Three months later, we got a letter from my dad’s LTCI company. They wrote that they noticed he had started using his LTCI and were going to raise his premium 12% or drop his daily benefit $17/day or $6,205/year. Hmm…
In my opinion, I don’t think nursing homes as we know them will be there in 30 or 40 years. As it is now, if you don’t have LTCI or enough money to pay for your care, Medicaid pays for you.
So, what should we do? Should we spend every penny we make while healthy, then ask our fellow citizen taxpayers to pay for our care via Medicaid when we are penniless? That seems to be the approach many Americans take. To be fair, this has not even occurred to most people.
Or do we get an LTCI policy and hope to afford it and the probable price hikes on the monthly premiums? Rock, meet hard place. Hard place – rock.
I’d like to hear your thoughts. Have you found an LTCI company that will guarantee that they will not raise your premiums?