Yesterday The Wall Street Journal published the article “Should You Purchase Long-Term Care Insurance?” Actually, it was a debate between two people. Mark Meiners, a professor of health administration and policy at George Mason University, argued in favor of long-term-care insurance. Prescott Cole, a senior staff attorney at California Advocates for Nursing Home Reform, argued against. I feel compelled to respond because of Mr. Cole’s misrepresentation of the facts about long-term care insurance.
Much of Mr. Cole’s argument seems based on the belief that most care is still done in nursing homes. However, the facts are that over 85% of care is now received outside of nursing homes, making much of his argument moot. Nursing homes are one of the myriad care options available to those with long-term care insurance, but most claimants now prefer care in settings ranging from the comfort of their own home, to adult day care, to assisted living facilities and more.
Instead of asking “Should You Purchase Long-Term Care Insurance?” a better question 
is “What Is Your Long Term Care Plan?” because that’s what this argument really boils down to. It’s not the risk of experiencing a long-term care event; it’s about the consequences if it does happen. Insurance can’t prevent the risk, but it can help your caregivers manage the consequences.
Let’s face it, when you need care, someone will provide that care, most likely a family member. So, it becomes a matter of how providing your care will affect their health, finances and emotional state. Numerous studies have shown that family caregivers experience a higher level of physical fatigue and are more prone to illnesses. They experience almost double the normal rate of depression as they try to juggle work, their own family and your care. Family caregivers also experience financial difficulties as they work less, lose job opportunities, and pay out of pocket for some of the expenses of your care. Also, for a spouse, any money they spend on your care now is that much less that they can rely on for their own future needs. An insurance plan might not completely eliminate any of these stresses on caregivers, but it may reduce them to a more manageable level.
Mr. Cole also claims that in “the game” of long-term care insurance, you are playing with a “stacked deck.” What he fails to realize is that some of the insurance options available can stack the deck in your favor. For example, the shared-care option with many policies allows two people to share the risk by linking their benefits together. If one exhausts their policy benefit, they can use some or all of the spouse’s policy. Another option is to select a policy that links long-term care benefits with an annuity or life insurance policy: a win-win proposition. If you ever need long-term care, the policy will pay for the care, leveraging your premiums to many times your initial investment. If you never need care, your heirs will receive a death benefit from your plan. Linked benefit policies eliminate the “if I never use it, I lose it” argument.
As medical advances help us live longer, many of us will need some form of long-term care. The time to plan for how you will handle that eventuality is while you are younger, are in good health and have options. Like any kind of long-term strategy, you should first educate yourself on the options available to you, and then work with an experienced professional to make an informed decision. That way, whether you choose to insure with traditional long-term care insurance or one of the linked benefit policies, or you self-insure using your own money, you will go into that decision knowing all the pros and cons of your decision, and know how it will affect not just your care, but the lives of those around you.
Tuesday, November 22nd, 2011 | Cecily Kellogg | |
Two months before my wedding, my soon-to-be husband got a call from an emergency room near his mother. She’d come in with bad flu 
symptoms, and they wanted us to pick her up and take her home so she wouldn’t have to drive herself. When we arrived, it was immediately clear to us that she was completely mentally altered and a simple flu couldn’t be the explanation. After much insistence and fuss-raising, we got her evaluated by a neurologist. She had one of the worst cases of viral encephalitis the doctor had ever seen.
By the time our wedding arrived, she was in rehab recovering. The brain injury caused by her encephalitis, sadly, escalated her next big health crisis: Alzheimer’s. During the next 10 years, my husband slowly began taking over most of her care and managing her finances until we had to finally put her into a facility that could care for her escalating needs.
During those times, one thing that helped us immensely was rather unexpected. It turned out that many years earlier—right after her husband passed away—my mother-in-law purchased a very, very good long-term care insurance policy. This enabled her to have a home-care aid for several years, and helped in placing her in a better quality home when it came time. It was a tremendous boon to our family.
This was never clearer than this past January when it was my turn; I got a call from my mother’s doctor saying she was in for an appointment and clearly had some sort of very severe pneumonia. My mother was suffering from a profound hypoxia (lack of oxygen to the brain) that was causing her to be combative and mentally altered, and she was resisting going to the hospital.
After a 10-day medically induced coma, two months of rehab, and six months of my mother being out of work, my husband and I nearly lost our house trying to keep her (and us) afloat financially. My mother has zero long-term care insurance, no disability insurance (she’s an adjunct professor), and little in the way of savings. Eventually we addressed the problem by triggering my mom’s Social Security early and having her move in with us. We’re adjusting to being a family of four now; secretly I think my daughter loves having her Grandma around all the time. I do, too—mostly. We clash a little during TV time at night. But we’ll survive.
The contrast between the two scenarios is stark, and it’s all because my mother-in-law was smart and purchased long-term care insurance early; she was in her late 40s. We’ve brought the subject up with my mom, but we’ve met some resistance; she thinks long-term care insurance equals nursing home. We’re trying to correct that misconception; long-term insurance would actually make it much easier to keep her at home, after all. At 43 now myself, it’s also something my husband and I have on our “list” when our finances recover this year.
Tuesday, November 15th, 2011 | Lisa Wendt | |
When I insisted on having my dad, at 83, move in with my husband and me, you could have said I was an idealist or being overprotective, or that I was biting off 
more than I could chew.
At the time I would have argued with you vehemently, but you would have been right!
Based on my commitment to my dad, my sense of duty and my own idea of what to expect in my new role as a caregiver (and little actual research or planning), in my mind I was prepared.
“It won’t be a problem,” I reassured my husband. Dad’s cool—no Alzheimer’s, he takes care of himself and does well getting around the house. Sure, he needed some limited help to live on his own, but he was still the active and robust dad that I had known my entire life.
I can now tell you—complete with battle scars and learn-as-you-go frustrations—how quickly I learned how significantly a family is impacted when they are not fully prepared to provide care. I didn’t know that:
- You can’t take vacations without live-in assistance ($20 hour). In my case, Dad refused to go to a short-term nursing facility and I felt guilty.
- My dad’s senile dementia, though not very perceptible initially, would deteriorate and trap us so we could not go out to the store or anywhere for more than a few hours for fear he would decide to cook or walk down the street alone—neither of which he could do without hurting himself.
- Numerous and inevitable health issues would pop up with more frequency, causing me to miss critical work time.
- My husband’s dream of building a restaurant for retirement income would fall to the wayside because it would cost more and more to support my dad while we both worked extensive hours.
- The issue of dealing with memory loss and associated combative behavior would cause fights, arguments and guilt.
- The progressive need for care would create a need for more skilled “sitters” if my husband and I succeeded in getting away for a few days. Such care was needed for prevention of bed sores, maintenance of feeding tubes, and monitoring of questionable continence.
My dad lived to be 90 years old and was near the end of his retirement savings when he passed away. I kept my promise to have him stay with us for as long as he was able, but I paid a bigger price than I could have imagined all those years ago when I made that promise. I’m more convinced than ever that planning for my own later years with tools like long-term care insurance is a must for me and my family.
While you can’t plan for everything, long-term care insurance would have helped eliminate unnecessary stress and certain unknowns for me while I was caring for my dad. Simply put, it provides caregiving options that ensure you or your family members receive the care you need without depleting your savings.
Long-term care insurance ensures that families don’t have to assume the numerous demands of caregiving alone. In addition to custodial care at a nursing home or assisted living facility, most long-term care insurance plans cover adult day care services and home care that can give family caregivers a much-needed (and well-deserved!) break from their caregiving responsibilities. Some plans also have flexible options that will cover care provided by friends or family members, training for informal caregivers, home modifications and medical equipment.
Not everyone likes to talk about getting older and planning for our later years. It can be a very emotional subject. But finding a simple, worry-free solution will give you peace of mind knowing that your financial security is protected and you receive the care you need.
I encourage you to use Long-Term Care Awareness Month as an opportunity to learn more about the resources and products available to plan for your future long-term care needs and begin this important discussion with your loved ones.
Donna was fortunate to follow in her sister’s footsteps. Her older sister had purchased a long-term care insurance policy, and although Donna was only 56, she thought getting the coverage was a good idea, too.
She also had experience with it. Her ailing aunt had made great use of her long-term care insurance policy, but because she had bought it at an advanced age—in her 80s, her premiums had been high.
Getting long-term care insurance at a younger age felt like a smart financial move, and it also helped put Donna’s mind at ease, given that she lived alone. She got a policy that provided a daily cash benefit, which meant that it would cover family and friends providing care for her at home if it were ever needed.
Little did she know that even before reaching retirement she would be tapping into her long-term care insurance benefit.
Donna went into the hospital for a partial knee replacement and came out of surgery with a fractured tibia. The doctors knew something more serious was wrong. In fact, Donna was later diagnosed with Turner Syndrome, which is a degenerative disease of the bones.
She was able to continue to work as a registered nurse, but no longer as a bedside nurse. She took intermittent time off for several additional surgeries and to recuperate from illnesses related to her disease. Her long-term care insurance benefit helped pay for care while she was on sick leave, and continued for a few months after she returned to work to cover ongoing therapies and transportation. She says it was of “tremendous help financially.”
Eventually her illness took its toll, and Donna found herself unable to continue working. She now relies on her long-term care benefit more and more as her disease progresses. Of 
comfort to her is the fact that while family and friends continue to help her out, she is able to pay them for their time, effort and gas, thanks to her long-term care insurance benefit. “I honestly don’t know what I would have done without this benefit,” she says.
In addition, now that Donna is receiving benefits from her policy, she does not have to pay the premium for it, due to an additional rider she had in place.
Donna could not have known at age 56 how much she would be relying on her long-term care insurance. And if she had waited until her 60s to buy it, it would have been too late. That’s the catch—you can’t buy coverage after you find out you need it.
We may not all have an older sister to rely on for good advice, but we can all tap into the expertise of a knowledgeable financial advisor. Don’t hesitate to bring up your concerns about how you will pay for long-term care. As Donna says, “You can’t afford to go without long-term care insurance.”
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