Big thanks to Margie Barrie, long-time colleague and friend, for the following insights that “sum it up” for long-term care insurance (LTCi). The information below came from an article Margie recently wrote for LifeHealthPRO.
1. 73 percent of claimants are receiving benefits outside of a nursing home:
- 49 percent: Home health care.
- 24 percent: Assisted living.
- 27 percent: Nursing home.
2. 21 percent of claims are expected to last five years or longer.
3. What are the odds of needing long term care?
- 58 percent of men ages 65 and over will need care, for an average of 2.2 years.
- 79 percent of women ages 65 and over will need care, for an average of 3.7 years.
4. Assisted living facility, average length of stay: 21 months.
5. The average premium for a stand-alone LTCI policy is $2,400. That’s 3 percent higher than it was a year ago.
6. 92.3 percent of buyers are buying policies with elimination period of 90 to 100 days.
For clients who want to dive deeper
6. Medicaid: $117,240 is the maximum amount of assets that the federal government will let a healthy spouse keep before the other spouse can be eligible for Medicaid long-term care benefits. (Many states set the cap at a lower level.)
7. Lapse rate for LTCI policies:
- 1 percent is the estimated lapse rate for stand-alone LTCI policies.
- 0.5 percent is the estimated lapse rate now being used by Genworth in its projections.
8. 4.5 years is the average length of time someone lives after being diagnosed with dementia.
9. Claims length:
- 42 percent of claims last less than one year.
- Claims lasting less than year are usually for home health care and caused by falls.
- The average length of claim that lasts more than a year is four years.
10. Claims: How much?
- $7.5 billion of LTCI claims were paid in 2013.
- Over $5.2 million was paid each business day.
- 273,000 people received benefits.
11. Claims: Who’s getting the benefits?
- 71 percent of the benefits dollars are paid to female claimants
- 51 percent of the benefits are paid to claimants with mental disorders, including dementia.
12. Claim records (from Genworth):
- 27 is the age of the youngest person to go on claim.
- 103 is the age of the oldest person to go on claim.
- About 20 years is the length of the longest claim.
- $1.3 million is the amount of benefits paid in connection with the biggest single claim.
13. Age of buyers:
- 24.7 percent are between the ages of 45 and 54.
- 54 percent are between the ages of 55 and 64.
- 57 is the average age of applicants.
14. In 2011 and 2012, 67 percent of nursing home residents were female.
15. The number of people using long-term care services:
- 15 million: The number of people in the United States using nursing homes, alternative residential care or home-care services for LTC needs in 2000.
- 27 million: The number of people in the United States who are projected to be using nursing homes, alternative residential care or home-care services for LTC needs by 2050.
- 40.2 million: The number of Americans ages 65 or older in 2010.
- 88.5 million: The projected number of Americans ages 65 or older in 2050.
17. Burden on unpaid caregivers:
- 80 percent of long-term care is provided by unpaid caregivers at home.
- 67 percent is the approximate percentage of unpaid caregivers who are female.
- 67 percent of the people who plan to have a loved one provide care, haven’t asked the loved one.