Long Term Care Insurance Going Up
A 71-year old Massachusetts man will pay $3300 per year for his long term care insurance, up 10% from last year, according to a story in the Boston Globe on September 6.
Premiums are generally going up while some companies like Prudential and John Hancock have stopped issuing new policies or dropped group coverage.
Rates for policies can go up, when approved by the Massachusetts Insurance Commissioner, as long as all rates for the rate class go up and there’s no discrimination on an individual basis.
There are different benefits available, so a lower-cost policy will provide fewer benefits. Different companies charge different rates.
The possible need for long term care can’t be ignored. 70% of individuals now age 65 are projected to need some form of long term care in their lifetimes.
In Massachusetts now, a semi-private nursing home room costs $126,000 per year.
Strategies:
- long term care insurance
- continuing care retirement community
- self-pay for services as needed
- family members provide care as needed
- Medicaid (after nearly all assets used up; can be difficult to qualify for)
Medicare generally does not pay for long term care.
Each strategy has pros and cons, and the best approach depends on the individual situation.
But regardless of strategy, it’s critical to plan ahead —years ahead— because of the costs involved and potential impact on family members.