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This is the issue with long-term care insurance: the insurer can't possibly cover a significant part of your long-term care expenses if you're only paying a total of like $100k in premiums, ever. It would work better if most elderly people didn't need long-term care. And it does, but only by the insurer insisting that long-term care is both quite limited (coverage limits) and also not applicable for a lot of people who think they ought to qualify (diagnosis limits). On the other hand, my experience so far is that even with absolutely platinum levels of health care coverage, you have to fight tooth and nail with everyone involved in the process to get the care you are entitled to. That includes the doctors and hospitals, because they both don't believe that you have platinum coverage and proactively try to limit services to what they imagine you'll be covered for, and, because they are also fighting with the administrations of their own organizations to get permission to deliver care. And that's not even talking about the number of health care workers who have more or less checked out of the effort and just do the bare minimum to stay employed, due to burnout or whatever. So the anecdotes about the long-term care insurance may just boil down to people dealing with the absolutely typical stonewalling and intentional, punitive bureaucracy of any type of health care insurance provider, and not actually special to LTC insurance in particular.
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May 4, 2024 23:29
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I'm not a legal expert, but the elder care lawyer my sister and I talked to explained how they can protect my Mom's savings by establishing an irrevocable trust that Medicaid can't touch. We hide (in a legal way for the state of NJ) that money away, pay the first year or so at the rest home, and then Medicaid pays after that. That's the gist from how I understood it, anyways. Your state may vary.
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May 4, 2024 23:56
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Be careful that you understand the details of the various limits for the specific type of irrevocable trust you get. It is indeed a way to "hide" or rather sequester someone's money so that they can qualify for means-tested benefits. But it's irrevocable, and depending on the type, there can be clawbacks after death, limits on spending, etc.
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May 5, 2024 00:07
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Yeah that was something we set up for my mother, because my grandparents didn't do it until too late. In NY, there's a clawback period even post-trust of X years (5? 7?), something like that. Even if the assets are in a trust, until they've been there for long enough, they're still fair game for state Medicaid / spend-down purposes. There are some things that the spousal impoverishment provisions can get around (like not having to sell your primary residence, etc), but you still have to have all that stuff sorted. The first thing I did after I saw the poo poo my grandparents went through was massively increase my life and disability insurance, get my mother LTC insurance (which was before every provider died/went bankrupt / realized they couldn't honor any of what they promised), and set up trusts, wills, end of life stuff, etc etc for my own family. No way in hell I want my wife or kid to have to deal with any of the poo poo my mother and grandmother did. What a trainwreck.
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May 5, 2024 02:36
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