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Archives for February 2015

One Article Says It All

February 27, 2015 by Honey Leveen Leave a Comment

Baby Boomer With CaregiverThis February 16, 2015 Chicago Tribune article succinctly hits all the reasons why it is in every insurable, non-poverty stricken Americans best interest to plan for possibly needing long-term care.

Here are some quotes from the article that I especially like.

“While baby boomers had the opportunity to plan for aging, many also had that generation’s impulse for immediate gratification and haven’t saved,” says Lucia West Jones, executive director for the nonprofit Northeastern Illinois Area Agency on Aging.

The numbers back up her concerns.

According to an AARP survey of people 50 or older, 62 percent of workers say they are saving for health-care costs, but 55 percent are worried they may not be able to afford those expenses.

Information from the AARP also states the average 65-year-old couple will need $220,000 for 20 years of post-retirement health-care costs, with Medicare possibly covering little more than half those years.

The U.S. Department of Health and Human Services’ Administration on Aging claims at least 70 percent of people who live to 65 or older will need long-term care services and support at some point when they are elderly.

In the Chicago area, according to a 2014 study from insurance holding company, Genworth Financial, annual costs for full-time home care aides or services are more than $49,000; for adult day care, almost $20,000 per year; almost $60,000 per year for an assisted living facility; and a semi-private room in a nursing home averages more than $80,000; with a private room more than $92,000.”

(For accurate long-term care costs in your locale, click here for Genworth’s Cost of Care Survey.)

Last but not least, I like the article’s acknowledgement that long-term care insurance (LTCi) kept Ms. Fleming’s mother off of Medicaid. She had higher quality care and her family had a less stressful experience because she owned LTCi:

“LTCi kept them off Medicaid.  Even with the long-term care policy, Fleming said she spent months sifting through her mother’s health insurance and Medicare paperwork, providing documentation to the insurer to secure benefits covering her mother’s expenses. No Medicaid was needed to pay for her mother’s care.”

As I’ve said so many times, it is very unfortunate that acknowledgement of long-term care insurance (LTCi) ownership is usually done grudgingly, as an “oh, by the way” mention, hidden deep within the content of stories like this.

Why did this story emphasize that Ms. Fleming needed months to provide adequate documentation in order to collect from Mom’s LTCi? Of course, all claims require proof of need.  But the story doesn’t give us any idea of what took so long to provide. Claims on LTCi are straightforward and not complicated and certainly do not require a great deal of time to complete.

If anyone has questions about how straightforward LTCi claims are, please contact me. LTCi claims are black and white. They are unambiguous.

Why did the author of this article not choose to emphasize the truth? The main point is that substantial amounts of money were collected from Mom’s LTCi: enough money to keep Mom off Medicaid and out of a nursing home.

Filed Under: Denial, Elephant in the Room, Helpful Information About LTC, I'll Just Self-Insure, Information About LTC Tagged With: Honey Leveen, Long Term Care insurance, LTCi, Medicaid, www.honeyleveen.com

Low Caregiver Wages Create Vicious Cycle

February 24, 2015 by Honey Leveen Leave a Comment

Low Paid Healthcare WorkerHigher wages are needed to sustain a viable home-care workforce, especially as demand for home services continues to grow with an aging population, home-care worker advocates have argued. A new study has just been published. Here’s the report (PDF), which demonstrates just how serious the wage issue is for home-care workers and those they serve.

An article in the February 18, 2015 edition of Modern Healthcare says we’re going to have a burgeoning number of Baby Boomers who’ll need home care. Most of them will unfortunately, be financially unprepared for long-term care. The article states, “Projections have estimated the number of Americans age 65 and older will more than double, from 40 million in 2010 to 88 million by 2050, according to HHS.”

Quoting again, because home care providers are currently paid such low (and actually declining) wages, “Three out of five of the country’s 2 million home-care aides rely on some type of public assistance through programs such as Medicaid, food stamps or help paying for housing and utilities.”

“The average hourly wage for home-care workers is around $9.61, for an annual median income of $13,000, just above the individual federal poverty level of $11,770.”

“Low pay, scarce worker benefits and limited opportunities for advancement have contributed to an annual turnover rate of 50% among home-care workers.”

The study proves that poverty that poverty wages undermine quality of care.

If you want a to stack the odds in favor of a high dignity, caring, nurturing outcome if you need long-term care, you will need to pay caregivers a living wage. The only way, for most middle-to-upper-class Americans to do this is by owning long-term care insurance (LTCi).

Filed Under: I'll Just Self-Insure, Information About LTC, Long-Term Care Awareness Month Tagged With: home care, Honey Leveen, www.honeyleveen.com

LTCi…Who Cares?

February 21, 2015 by Honey Leveen Leave a Comment

Ron HagelmanI’ve re-published below my friend and colleague Ron Hagelman’s October 2014 Broker World Magazine column. Ron writes eloquently and from his heart. Plus, he is fun to read. He explains why buying long-term care insurance (LTCi) will always be less about wealth preservation and more about love. The primary reasons my clients buy LTCi are to show kindness, consideration and love to themselves and their families.

Ron has a knack for describing the frustration and concern I experience on a daily basis. Most people refuse to think about what might happen to them in the last years of their lives, so far in the future.

I love you, Ron!

Here is Ron’s column, titled, “LTCi…Who Cares?”:

The frustration inherent in the title is not the point. Surveys continue to point out the obvious: As far as the future of the LTCI industry is concerned, familiarity with the pain and stress of caregiving in America remains the most reliable motivation to buy. The most recent U.S. census information confirms the inexorable progression of an aging population with 13 percent of our population currently over 65, rising to 20 percent by the year 2030. Institutional care has never been the answer. Nursing home populations have decreased by 20 percent since the year 2000. Although the growth of assisted living alternatives has been noticeable, seniors would of course rather receive care at home if at all possible. A report just released by the U.S. Census Bureau, “65+ in the U.S. 2010,” confirms what we already suspected: “90 percent of people older than 50 express the preference to be cared for in their own home.” The problem of course is who will provide that care. In another recent poll, 75 percent of seniors reported they could only identify two people who might help them when the time came that they needed care.

Finding care may be the single largest problem we all will face when the need for care arises. The fact is that roughly 70 percent of all informal care comes from relatives. This is, however, a vanishing resource. According to the new AARP study, “The Aging of the Baby Boom and the Growing Care Gap,” the ratio of potential family caregivers to high risk people in their eighties is falling rapidly. Although seven to one in 2010, it is expected to drop to four to one by 2023, and three to one in 2050. There is no alternative but to shift to more paid caregivers, which will dramatically increase the cost of future long term care. I think we can all agree that perhaps the hardest part of the sales conversation is explaining the real risk and convincing your prospect that, “Yes, this can happen to you!” Improper, misguided and inadequate planning remains our curse. (Amen, Ron!)

Although most buyers claim that protecting assets is their primary motivation for acquiring coverage, the purchase of LTCI is never just about the money. Just as a long term care event is never just about the person needing care—it is about all those family members willing to respond to the problem, which can severely impact their own finances and their careers (including their own health issues aggravated by the stress of caregiving). The bottom line is that attempting to plan for long term care is not simply a financial decision. There are more important questions concerning who will provide your care, in what setting will it take place, to what extent do you plan to involve family members, and from exactly where will the money arrive? Please recognize that it is immediate family, those for whom the insured cares the most, who will bear the burden of care. Eighty percent of the time, informal caregivers are the most immediate family, including spouses, daughters, daughters-in-law, and sons-in-law. Caregiving, especially from spouses, may represent a substantial threat to the caregiver’s health, accelerating their own need for long term care. Usually there is a progression of care from part time assistance to full time maintenance, and as we know, as the need for care increases, the importance of freedom of choice and the quality of that care also increases.

A strong recommendation is to include your anticipated plan for care and available funding dedicated to that purpose in a separate “Care Agreement.” Too often families find themselves thrust into a care event for which no one was prepared. It is estimated that one-quarter of all Americans are currently receiving care. For 10 years this column has attempted to explore why what may represent America’s largest underinsured, under-planned and under-prepared risk remains at the end of the planning conversation instead of at its heart. Too many on both sides of the sale continue to ignore the obvious at their own peril. By not making the risk a required universal recognition and featuring its resolution as a centerpiece of everyone’s planning practice, we unnecessarily jeopardize consumer confidence, agent ethics and company relevance.

Other than that I have no opinion on the subject.

Author’s Bio
Ronald R. Hagelman Jr., CLTC, CSA, LTCP
CLTC, CSA, LTCP, has been a teacher, cattle rancher, agent, brokerage general agent, corporate consultant and home office executive. As a consultant he has created numerous individual and group insurance products. A nationally recognized motivational speaker, Hagelman has served on the LIMRA, Society of Actuaries, and ILTCI committees. He is past president of the American Association for Long Term Care Insurance and continues to work with LTCI company advisory boards. He remains a contributing “friend” of the SOA LTCI Section Council and the SOA Future of LTCI committee. Hagelman is president of Broadtower Insurance Solutions, a national IMO helping BGAs enhance LTCI production. Hagelman can be reached at Broadtower Insurance Solutions, Inc., 156 N. Solms Rd., New Braunfels, TX 78132. Telephone: 830-620-4066. Email: rhagelman@broadtowerinsurancesolutions.com. Website: www.BroadtowerInsurance.com.

Filed Under: Denial, Elephant in the Room, Helpful Information About LTC, I'll Just Self-Insure Tagged With: Broker World Magazine, Honey Leveen, Long Term Care insurance, LTCi, Ron Hagelman, www.honeyleveen.com

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