LTC - Impoverishing spouse

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Jun 21, 2009 1:36 pm

When someone is concerned with preserveation of their estate it's pretty simple to show prospects LTC and a second-to-die and let them choose which solution best meets their needs.

However when we're talking LTC with prospects and they're more concerned with impoverishing the spouse rather than preservation of their estate LTC is the only solution, and a tougher sale at that.  What are the concepts people are using when presenting LTC as the solution to the concern of impoverishing the spouse?

Jun 21, 2009 2:03 pm

What do you mean "impoverishing the spouse"?  Are you referring to a spend-down for Medicaid purposes?

Jun 21, 2009 2:48 pm
deekay:

What do you mean "impoverishing the spouse"?  Are you referring to a spend-down for Medicaid purposes?



Yes.

Jun 21, 2009 3:09 pm

Do you live in a LTCi partnership state?  If you do, they're better off buying a LTC policy because they can (if needed) qualify for Medicaid AND protect assets. 


If not, bring them on a field trip to a Medicaid-only facility.  Ask them if they'd like more (and usually, better) options.  Many of these places are supreme sh*tholes.
Jun 21, 2009 4:11 pm

"Would you rather have care at home or a facility?"


If the answer is "home", medicaid is no longer part of the conversation.
Jun 21, 2009 4:57 pm
anonymous:

"Would you rather have care at home or a facility?"

If the answer is "home", medicaid is no longer part of the conversation.



And just like that they write you a check for $300-500 for the first month of a LTC program?

Jun 21, 2009 5:31 pm

$500 per month?? You selling LTC to 93 year olds?

Jun 21, 2009 7:05 pm
3rdyrp2:

$500 per month?? You selling LTC to 93 year olds?

 
I just ran an illustration for a standard, non-smoker male, age 60, $180 day lifetime benefit, compound inflation rider with a highly-rated mutual company for $7200/year.  Second-best class brings it to $5700/year.  Not exactly a benefit-rich policy, but not bear bones either.  My point?  The lower the premium on the LTCi policy, the greater chance there is a premium increase in the future.  I'm sure you can get a policy with a lower initial premium, but if you don't constantly tell the client there will be a premium increase, and you don't document this in your client file, you're going to be held responsible some time in the future.  Of course, not everybody will want to pay that much.  Sell a premium that is comfortable - something is better than nothing.
Jun 21, 2009 9:05 pm

Ahhh I see your point. I don't sell LTC often, but Genworth is the main provider we use. Enough said. I could get the same benefit you got for $250-275 per mth, but Genworths not exactly in 'cream of the crop' territory as far as financial position goes.

Jun 21, 2009 9:22 pm
3rdyrp2:

$500 per month?? You selling LTC to 93 year olds?



Just ran a quote on two married 65 year olds standard rating, $175 per day benefit, 5yrs, 20 year compound at 5% and it comes to $473/mo

What policies are you selling?  Are they confined care only with no home health care?

Jun 21, 2009 9:25 pm

I sell Genworth on occasion.  I PROMISE all of my Genworth clients that they will have premium increases.  I was doing this when Genworth's selling point was 30+ years of no premium increases.


 
"And just like that they write you a check for $300-500 for the first month of a LTC program?"
 
Nope.  It just means that having the government pay for their care is no longer an option.  They realize that they need to fund their own care.  This has to either be with their hard earned dollars or with pennies on the dollar with insurance premiums.
Jun 21, 2009 9:39 pm
BerkshireBull:
3rdyrp2:

$500 per month?? You selling LTC to 93 year olds?



Just ran a quote on two married 65 year olds standard rating, $175 per day benefit, 5yrs, 20 year compound at 5% and it comes to $473/mo

What policies are you selling?  Are they confined care only with no home health care?

 
I can see shared policies obviously being up there in cost, I was thinking about just individual policy costs.  I sell only with compound increases and 100% home care, but I've never had a policy run that was over $300-$325/month.  I can see how higher rated firms would be higher in cost though.
Jun 22, 2009 6:39 am

If quotes are dramatically different between companies like we are seeing in this thread, there is something very different about the parameters being quoted.

Jun 22, 2009 9:36 am

Depends on your state.  In my state, $180/day doesn't pay for much.  I don't have the current #'s, but in 2005 the average daily rate for skilled nursing care in my state was $284/day (per the State Partnership Guide).  And this includes all the nursing home dumps in the urban areas.  You want something nice around the area where I live, it could be 30% more than that.

Jun 22, 2009 7:41 pm

B24, is it a safe assumption that you don't sell long term care insurance?

Jun 22, 2009 10:05 pm
anonymous:

B24, is it a safe assumption that you don't sell long term care insurance?



LAWL!

He won't sell any if those were the "facts" he uses to establish the need!

Jun 23, 2009 7:41 pm

If I own a long term care insurance policy and my benefit is $300 a day, and the cost of care in my area for skilled nursing care is $284, what will my benefit be if I'm in a facility because I need skilled care?

Jun 23, 2009 7:49 pm
anonymous:

If I own a long term care insurance policy and my benefit is $300 a day, and the cost of care in my area for skilled nursing care is $284, what will my benefit be if I'm in a facility because I need skilled care?



Trick question, your daily benefit is $0 because you have an Edward Jones Rep who proclaims to be your "financial advisor" and a "planner" but never took the time to talk to you about long term care.

Jun 24, 2009 8:11 pm

The answer is $0.  It is $0 whether the policy is from the EDJ Rep or BerkshireBull from Big Insurance company.

Jul 24, 2009 2:00 pm

LTCi shouldn't be about covering ALL the costs of LTC (if it was, nobody would ever buy it--as you've noticed, it gets prohibitively expensive). 

Try running quotes at $100-150 a day w/ a compound adjustment, and monthly benefits.  Lifetime policies have nearly been priced out of many of my clients tolerance levels (as opposed to a few years ago).  I run 3-5 year policies for all new clients. 

Just had my 2nd client start receiving benefits yesterday.  After the 1rst one had a stroke and started collecting due to mental impairment (while living at home), I became a big advocate.  Now, after the 2nd one...I'm a fanatic about it.