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Baby Boomers as a group have been distrupters all their lives. It is the size of our cohort that will present a tremendous societal problem that will be very local in impact. Are there enough beds for us now? No! Were there enough class room seats for us as we started to hit elementary school decades ago? No did it require a massive building program by state and local governments? Yes!
Where are the beds for independent living, assisted living, memory care and SNF going to come from? Built by whom and intended for whom?
Will they come from non profits or for profits? Hedge funds? Located where and will they be build for those without LTCi or well financed to self pay for a considerable time period? Will they build to provide Medicaid beds or to avoid them?
Will 4 and 5 star facilities be build for you or someone else? Might want to research what is going on in your area and what current projections for access might be when you need it. We are finding it very interesting. Remember the Boomer crunch is just starting to begin and if you assume the average entry age to programs is in the mid 70's and beyond what is sufficient now probably isn't when the crunch begins.
Won't it be great to have paid LTCi for years or saved and invested for years and only be able to get into a dive right next to the Medicaid beds.
They are opening an assisted living facility in manhattan which was on the news yesterday . It is 20k a month and includes no medical.
Yep , the baby boomer cohort is both huge and living longer . That will put demands on resources never seen before nor accounted for in any statistics prior.
Baby boomer statistics will not be known for decades yet as most are still to young to be in the care zone
This is so true, and one reason why I don't bother with insurance of most types. I self-insure.
I dislike insurance companies on principle. They are a private, profit-making enterprise that we are often forced into doing business with. They do not have our best interests in mind, only the company bottom line. The sales agents have to make their commissions, and most people would be shocked to know just how much of their premiums go into the pockets of insurance sales agents.
I realize that many people cannot afford to self-insure, but they may be ignorant of how much they'd actually save if they did. The LTC bills will get paid one way or another, but how many realize that it's their own money paying those bills (not the insurance company's money)?
I don't mind insurance companies so much as the utter lack of transparency around LTC insurance. At least people have experience with auto and HO insurance and the "rules" are clearer.
And yes, every business's objective is to make money! It just seems to hurt more and be more obvious when you don't collect on the premiums you paid in. Insurance is purely a numbers game.
The issue I see with buying LTC insurance is that you don't know what future premiums will be.
You can sign up for the insurance in your 50's, then the premium keeps increasing as you get moved into higher and higher risk groups, then 30 years later you need to go into LTC facility or need home care, but you canceled the policy a few years earlier because the premiums became unaffordable. You wasted 25+ years of premium payments and then still have no insurance when you need it.
Sounds like a nightmare.
I am looking into a fixed premium/payout life policy with an LTC rider. That means I can collect it instead of leaving it if I need LTC. The downside is that I have to decide if $300k will be adequate. Of course, there are scenarios that would burn through it but it would substantially decrease the odds of an LTC need wiping me out financially. The upsides are the fixed premium and the guaranteed payout (sooner or later, someone gets the money; it is more like an admittedly poor investment than just a pure expense).
I have also been pricing straight LTCi but it is expensive and as you note can get way more expensive.
I am looking into a fixed premium/payout life policy with an LTC rider. That means I can collect it instead of leaving it if I need LTC. The downside is that I have to decide if $300k will be adequate. Of course, there are scenarios that would burn through it but it would substantially decrease the odds of an LTC need wiping me out financially. The upsides are the fixed premium and the guaranteed payout (sooner or later, someone gets the money; it is more like an admittedly poor investment than just a pure expense).
I have also been pricing straight LTCi but it is expensive and as you note can get way more expensive.
I was thinking of you in my previous post. Do yourself a favor and take a look at options in NC especially Wilmington and the Triangle. You might find cost and access to be interesting and most certainly influence your thinking and planning. If you do research compare the goal and marketing of newer facilities compared to older ones. They can be very clear who they are marketing and intended for.
Without inflation increases those policy's can become almost useless 20 years later as they may pay very little relative to costs. Policy's in our state partnership plans must have 5% a year increases to be sold.
You can end up on medicaid all to quickly with no inflation protection .
That option can make these policy's so not worth it as it would be a better deal aggressively investing that amount of money and using a piece of those average returns to pay a premium on a regular plan.
Eventually you can have quite a lot of dough tied up in these policy's at little return.
Last edited by mathjak107; 07-12-2016 at 06:37 AM..
Without inflation increases those policy's can become almost useless 20 years later as they pay for very little.
You can end up on medicaid all to quickly with no inflation protection .
That option can make these policy's so not worth it as it would be a better deal aggressively investing that amount of money and using a piece of those average returns to pay a premium on a regular plan.
Truthfully trying to project this years out is Herculean in nature. We are to large a group and government already to burdened with debt. The ability of government to sell bonds to accomidate like they did starting in the fifties is no longer there. What are we going to have shifts for living in assisted living etc and up like we did elementary schools? Will you get the bed in the AM and another person in the PM?
One of the evolutions of CCRC's and one of their marketing goals is to enable you to lock in a certainty by going in early or by going on a waiting list with a refundable deposit of say 5K.
We have a few community's in long island but they are way to expensive for all but the wealthy.
I think eventually most states will follown ny , ct and florida which basically have adopted the ct ruling and ordered medicaid to negotiate payments that do not change the lifestyle of the stay at home spouse.
Our attorney who is one of ny's top specialists in elder care said he has all negotiation cases at this stage.
They are negotiating payments that are far less devastating
Last edited by mathjak107; 07-12-2016 at 06:12 AM..
We have a few community's in long island but they are way to expensive for all but the wealthy
So what are others to do? They don't want the average they want the top 20% of seniors and are finding various ways to market to them. You have resources will they work locally or will you need to adjust where you live somewhere. Builders are responding with 2 bedroom, 2 bath well appointed homes somewhere around the 300K range in NC. Intended for seniors on one level with socializing features etc. Also in well heeled communities with recreational activities and assisted living and up facilities near by etc etc. Your point about Manhattan is well made as land and housing is expensive and newer facilites are going to be build further out in the suburbs of metro areas amongst more expensive neighborhoods and shopping.
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