Some attorneys understand long term care insurance, others don’t.

by | Jan 16, 2016

Most elder law attorneys understand long term care insurance and the advantages it gives their clients who are healthy and want to plan ahead.  One of the leading advocates for long term care insurance is a founding member of the National Academy of Elder Law Attorneys, Harley Gordon.

Recently, a social media content writer, who blogs for elder law attorneys, wrote a blog that was filled with false and misleading statements about long term care insurance.  Unfortunately, unsuspecting attorneys copied and pasted this blog not realize how misinformed the blogger was.  Consumers have more choices today for long term care insurance than ever before.  In most states, twice as many companies sell long term care insurance than medical insurance.

Here are the false and misleading statements made by the blogger:

The blogger stated that "40% of people who apply for long term care insurance policies are turned down for health reasons." That is completely false.

For every 6 people who apply for long term care insurance 5 of them are approved (that’s only a 17% decline rate).  The 40% “declined” statistic is only true for people who apply for long term care insurance after their 70th birthday.  Obviously, the older someone is the more health problems they have.  The longer you wait to apply for long term care insurance the higher the chance of being declined.

 

The blogger then stated that "the policies do not offer life coverage." This statement is also completely false.

There are companies that sell policies that have no limit for how long the policy can pay benefits.  You could need care for 30 years and the policy would never run out of long term care benefits.  The companies that don’t offer unlimited policies still have very rich policy offerings.  For example, you can start off with $500,000 to even a $1,000,000 in benefits.  These benefit amounts will grow each year according to the inflation protection you choose.  Also, spouses/partners can share their policies which then doubles these benefit amounts.

Lastly, the blogger made this uninformed statement: "they are short term policies and if your need for coverage exceeds the policy term then the money spent on premiums is wasted."

Unfortunately, this blogger is not aware that 44 states have special, government-approved long term care insurance policies.  These Long-Term Care Partnership policies can protect your assets even if your policy runs out of benefits.
Personal Note:  Our decline rates are much lower than the industry average of 17%.  Because of our 20+ years of experience, we do thorough pre-screening for each client.  Less than 10% of our clients are declined each year (even our clients who apply for policies in their sixties and seventies.)
44 states, in cooperation with the federal government, have launched a Public/Private Partnership for Long-Term Care.  Owners of a government-approved Long-Term Care Partnership policy can protect their assets from Medicaid “spend-down” (while they are alive) and Medicaid “estate recovery” (after they pass away).

For example, a married couple both age 61, in average health, could share a Long-Term Care Partnership Policy with $250,000 of benefits. Their premium would be about $100 per month per spouse. If they used all $250,000 in the policy, they could apply for Medicaid and protect $250,000 of their savings from Medicaid.

If you want to protect more savings you can buy more benefits for a higher premium.
If you have less savings you can buy less benefits for a lower premium.
You can target how much coverage you want based upon how much of your savings you want to protect from Medicaid.

In every case a lifetime of savings can be protected through a Long-Term Care Partnership Policy.

The Long-Term Care Partnership Programs are the equitable solution to the crisis facing our nation. The wealthy pay more to protect more assets. The “not-so-wealthy” pay less and can still protect all of their assets.

 

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