What If You Needed Long Term Care NOW?

[Retired To Win]

Ever wonder what would happen to you -- and to your stash -- if you had a disabling stroke or crippling accident?  Not years in the future, when you are "old",  but right now?  It could happen, you know.

If that should happen to me, my long term care insurance policy will keep my stash from getting devoured and make sure I am (reasonably) properly cared for.  It's not a perfect solution,  and it costs me almost $200 a month.  But it gives me unconflicted peace of mind.

What's your game plan if the unthinkable happens to you?  What will you do?  How will you fund it?

[Zikoris]

This is the sort of question that really highlights how the Canadian health care system is superior.

I do have mandatory disability insurance through my employer at a low cost, but otherwise basic health care is always available for free here, and prescription drug costs max out at about $2000/year under Fair Pharmacare. Government disability payments are also enough to live on with a frugal lifestyle, and there are numerous other benefits for disabled people such as $45/year bus passes, free grocery delivery through most stores, etc.

So basically, it would suck, but it wouldn't cost me much, because I choose to live somewhere that has a sane system for handling these things.

[Songbird]

We have disability insurance as well.  The profession is too dangerous not to.

It brings huge peace of mind.

[Mississippi Mudstache]

Ever wonder what would happen to you -- and to your stash -- if you had a disabling stroke or crippling accident?  Not years in the future, when you are "old",  but right now?  It could happen, you know.

If that should happen to me, my long term care insurance policy will keep my stash from getting devoured and make sure I am (reasonably) properly cared for.  It's not a perfect solution,  and it costs me almost $200 a month.  But it gives me unconflicted peace of mind.

What's your game plan if the unthinkable happens to you?  What will you do?  How will you fund it?

I've looked into LTC policies. Don't they generally only cover 3 years of expenses? My mom has been in a LTC facility for the past 5 years and counting. I'm glad my Dad has the means to cover it, it costs him ~$60,000 a year. My mom is only 57, but she was diagnosed with early-onset Alzheimers at age 50 - well before they were thinking about LTC insurance.

I would rather enjoy 10 years of early retirement if my fate is to end up the same. There's no telling what kind of LTC policies will be available by the time my ER rolls around (~9 years from now), but I will check into it again when I approach that date. They really aren't very attractive at current terms and rates.

[Retired To Win]

We have disability insurance as well.  The profession is too dangerous not to.

It brings huge peace of mind.

Disability insurance is NOT what I am referring to in my original post.

I am talking about Long Term Care, as when you have to reside in a nursing home for indefinite periods of time -- or have daily nurse visits and other care at your home --  because you are unable to get around or take care of your physical needs.  Like even wiping your butt!

This is a whole 'nother kettle of fish from disability insurance, my friends!

[MandalayVA]

We have long term care insurance through our employer.  Quite frankly, though, if I or Mr. Mandalay had something like that happen we'd get our asses over to Oregon or Vermont or Washington. 

[Bracken_Joy]

Actually pretty relevant to me, since my brother got a head injury as an adult and now my family takes care of him. No joke that it can happen people. And because of the particulars of the accident, there is zero insurance coverage, including the medical bills incurred.

[HazelStone]

Ever wonder what would happen to you -- and to your stash -- if you had a disabling stroke or crippling accident?  Not years in the future, when you are "old",  but right now?  It could happen, you know.

If that should happen to me, my long term care insurance policy will keep my stash from getting devoured and make sure I am (reasonably) properly cared for.  It's not a perfect solution,  and it costs me almost $200 a month.  But it gives me unconflicted peace of mind.

What's your game plan if the unthinkable happens to you?  What will you do?  How will you fund it?

I have long term care insurance. So does my husband. It's relatively cheap if you get it young. I've seen Medicaid-based nursing homes. You don't wanna go there. Both of us have watched grandparents go into long term cognitive decline. A friend of mine was rendered quadriplegic. His parents take care of him. He worked for a major corporation and their "Long Term Disability" coverage covered only two years. Most quadriplegics don't live past a decade, he's unlikely to outlive his parents but you never know...

[Cpa Cat]

It would be devastating in more ways than one, obviously.

I have told my husband that if something like that were to happen, then he should divorce me strategically, so that there would be a limit to the cost of care, at least. Although, as someone just reminded me, I'm a Canadian citizen, so if it were me, he could move me to Canada for care.

He told me that he expected me to stay married to him forever and spend every last dollar keeping him alive.

Edited to add: Cursory research indicates that I might still be able to sponsor my husband for citizenship to Canada, even if he's a giant health care burden. So thank god for Canada, I guess. :p

[lizzzi]

Commonly in the U.S., the disabled younger population ends up with an SSI check (possibly SSD) and Medicaid is the health insurance.

[Songbird]

We have disability insurance as well.  The profession is too dangerous not to.

It brings huge peace of mind.

Disability insurance is NOT what I am referring to in my original post.

I am talking about Long Term Care, as when you have to reside in a nursing home for indefinite periods of time -- or have daily nurse visits and other care at your home --  because you are unable to get around or take care of your physical needs.  Like even wiping your butt!

This is a whole 'nother kettle of fish from disability insurance, my friends!

Whoops, my mistake.  I read your post incorrectly.

We do not have Long Term Care Insurance, but have considered it.   It's one of those decisions we are weighing out, especially as we age.

[HazelStone]

Ever wonder what would happen to you -- and to your stash -- if you had a disabling stroke or crippling accident?  Not years in the future, when you are "old",  but right now?  It could happen, you know.

If that should happen to me, my long term care insurance policy will keep my stash from getting devoured and make sure I am (reasonably) properly cared for.  It's not a perfect solution,  and it costs me almost $200 a month.  But it gives me unconflicted peace of mind.

What's your game plan if the unthinkable happens to you?  What will you do?  How will you fund it?

I've looked into LTC policies. Don't they generally only cover 3 years of expenses? My mom has been in a LTC facility for the past 5 years and counting. I'm glad my Dad has the means to cover it, it costs him ~$60,000 a year. My mom is only 57, but she was diagnosed with early-onset Alzheimers at age 50 - well before they were thinking about LTC insurance.

I would rather enjoy 10 years of early retirement if my fate is to end up the same. There's no telling what kind of LTC policies will be available by the time my ER rolls around (~9 years from now), but I will check into it again when I approach that date. They really aren't very attractive at current terms and rates.

I spent several years in the insurance world. Thankfully, I got out of it. I did deal with LTC policies, though. You can get a variety of benefit periods; 3-5 years is the most popular. Some go for 10 years, some go for a lifetime policy (which are getting rarer these days).

Basic statistics: the cost of LTC coverage is high because long term care is expensive, and people have a high probability of needing it in the not-so-distant future when most people buy it. These are the same principles as why collision coverage costs so much for a teenage driver. If you get it when you're 70, if (general, not specific) you are obese and diabetic, yes, it costs a lot.  If you get a policy with a longer waiting period before benefits kick in, the premium is cheaper- but then you are paying the first 6+ months of your care costs before you see benefits. However, if you've got a decent pile in the bank, it may be a risk you're willing to afford. Most of the policies also cover in home care instead of nursing home care if needed.

There's a lot of factors involved. Some people might only be a year or two in the home, and some of those people can pay that out of pocket. Others will be in a lot longer (dementia/alzheimers cases). The problem is, you just don't know. It's a complicated subject. In the US I would not trust the government to give you adequate care if you needed it.

Then again, given the perma-ZIRP in which our financial system languishes, insurance rates of any kind are likely to get worse. Cheery, huh?

[MayDay]

At our ages (30's) there is no way we are going to pay LTC insurance premiums for the next 30 years just in case we have a bad accident.  More likely we'd divorce (so only half the assets were lost in the medicaid spend-down) and/or try to care for spouse in home with help from retired parents.  But in the end I think both of us would prioritize conserving money to properly raise our children over providing top notch nursing care for ourselves. 

[HazelStone]

At our ages (30's) there is no way we are going to pay LTC insurance premiums for the next 30 years just in case we have a bad accident.  More likely we'd divorce (so only half the assets were lost in the medicaid spend-down) and/or try to care for spouse in home with help from retired parents.  But in the end I think both of us would prioritize conserving money to properly raise our children over providing top notch nursing care for ourselves.

Most argue that a good disability policy is a much higher priority, especially earlier in a career. Take care of the higher probability problems first. But as the OP was regarding long term care...

[AlwaysBeenASaver]

I've thought a lot about LTC insurance, even got some quotes several years ago. The problem I found is that most policies have a relatively short time period and/or relatively small $ amount, that they cover. If that's what I need for my illness/injury, I can pay of out pocket and don't need a policy. The real issue I see is if I need LTC for say 40 years. I haven't found a good solution to that possibility, so as it stands now if I needed round the clock care I would pay out of pocket for a facility until the $ ran out, then I would become a ward of the state and have to go into a state run facility and hope it's not too bad. I have a family member that was in one for several years, as a ward of the state, and it wasn't terrible.

[Gin1984]

We have long term care insurance through our employer.  Quite frankly, though, if I or Mr. Mandalay had something like that happen we'd get our asses over to Oregon or Vermont or Washington.

I'm with you, Mandalay.

[biscuitwhomper]

LTC is really the elephant in the room when it comes to early retirement.    I don't think I have heard any good strategies to date.    My strategy?     No idea, but I have no children and a spouse who shares my strong views on quality of life issues.    You can come to your own conclusions.....

[Retired To Win]

I've looked into LTC policies. Don't they generally only cover 3 years of expenses? My mom has been in a LTC facility for the past 5 years and counting. I'm glad my Dad has the means to cover it, it costs him ~$60,000 a year. My mom is only 57, but she was diagnosed with early-onset Alzheimers at age 50 - well before they were thinking about LTC insurance.

Policies vary.  Originally, mine was a "lifetime" policy; but price increases caused me to reduce that to a 10-year term.  My wife's policy has a 6-year term.

... There's no telling what kind of LTC policies will be available by the time my ER rolls around (~9 years from now), but I will check into it again when I approach that date. They really aren't very attractive at current terms and rates.

Well, do bear in mind that the older you are when you start a policy, the higher the premium will be.  AND, you're assuming and hoping nothing is going to happen between now and your ER date to make you need that policy!

[3okirb]

One thing to keep in mind is that long term care premiums aren't fixed like life insurance can be.  It could (and does) go up.  I've had clients who have had 40% increases have to drop their coverage.  Not to say that threre's no value there, but companies are starting to find out that LTC is getting more and more expensive and they're not in the business of losing money.  A big issue is Alzheimers.  You can be in a facility for 20+ years with that one.  (One of the reasons that lifetime benefits are getting rarer)  The average stay is less than 2 years.

[Another Reader]

Self-insure against this risk.  Income producing assets, mostly rentals, and a trust that requires the trustee to spend the income correctly.  20 years of at-home or institutional care would be no problem, at least financially.  ZIRP and some insurance company's finances are not an issue when rentals are producing a much higher rate of return.

[MayDay]

At our ages (30's) there is no way we are going to pay LTC insurance premiums for the next 30 years just in case we have a bad accident.  More likely we'd divorce (so only half the assets were lost in the medicaid spend-down) and/or try to care for spouse in home with help from retired parents.  But in the end I think both of us would prioritize conserving money to properly raise our children over providing top notch nursing care for ourselves.

Most argue that a good disability policy is a much higher priority, especially earlier in a career. Take care of the higher probability problems first. But as the OP was regarding long term care...

We do have disability and life.

[oldtoyota]

We have long term care insurance through our employer.  Quite frankly, though, if I or Mr. Mandalay had something like that happen we'd get our asses over to Oregon or Vermont or Washington.

I'm with you, Mandalay.

Why? What do those states do differently?

[bogart]

Why? What do those states do differently?

I believe they allow, or at least are more tolerant of, doctor-assisted suicide.

[Kris]

We have long term care insurance through our employer.  Quite frankly, though, if I or Mr. Mandalay had something like that happen we'd get our asses over to Oregon or Vermont or Washington.

I'm with you, Mandalay.

Why? What do those states do differently?

Assisted suicide.

And I'm with Mandalay, as well.

[Mississippi Mudstache]

I've looked into LTC policies. Don't they generally only cover 3 years of expenses? My mom has been in a LTC facility for the past 5 years and counting. I'm glad my Dad has the means to cover it, it costs him ~$60,000 a year. My mom is only 57, but she was diagnosed with early-onset Alzheimers at age 50 - well before they were thinking about LTC insurance.

Policies vary.  Originally, mine was a "lifetime" policy; but price increases caused me to reduce that to a 10-year term.  My wife's policy has a 6-year term.

... There's no telling what kind of LTC policies will be available by the time my ER rolls around (~9 years from now), but I will check into it again when I approach that date. They really aren't very attractive at current terms and rates.

Well, do bear in mind that the older you are when you start a policy, the higher the premium will be.  AND, you're assuming and hoping nothing is going to happen between now and your ER date to make you need that policy!

I'm at the point where I feel that money is better used on investments than insurance.

[Retired To Win]

What I wonder is what happens if you need LTC now, spend all your assets for care (or spend them down to qualify for Medicaid care) and then you get better? If you are 40 and retired (i.e. no work related disability insurance) when you are injured or ill, and by 50  you have recovered from your stroke or car accident or whatever that left you in need of a high level of care and are released from care what do you do next?  With no money or assets, and maybe not well enough to work ever again but well enough to care for yourself, what happens next?

You've distilled very well the worst-case scenario I used to worry about.  BUT...

Hell's bells, girl.  That's WHY I have LTC insurance.  So that precise scenario you painted above does not happen to me!

[MandalayVA]

Why? What do those states do differently?

I believe they allow, or at least are more tolerant of, doctor-assisted suicide.

Assisted suicide is legal in those states.  I highly recommend watching the documentary "How To Die In Oregon"--I watched it on Amazon Prime and I'm pretty sure it's on Netflix too.  Last fall a young woman named Brittany Maynard made the news because she issued a public statement about moving to Oregon to end her life because she was suffering from inoperable brain cancer.

http://www.cnn.com/2014/10/07/opinion/maynard-assisted-suicide-cancer-dignity/

If I have the choice to go painlessly rather than suffering, I'll take it.

[HazelStone]

Self-insure against this risk.  Income producing assets, mostly rentals, and a trust that requires the trustee to spend the income correctly.  20 years of at-home or institutional care would be no problem, at least financially.  ZIRP and some insurance company's finances are not an issue when rentals are producing a much higher rate of return.

Yes, but first you have to build your capital base. What do you do when you're still in the accumulation phase?

[biscuitwhomper]

Self-insure against this risk.  Income producing assets, mostly rentals, and a trust that requires the trustee to spend the income correctly.  20 years of at-home or institutional care would be no problem, at least financially.  ZIRP and some insurance company's finances are not an issue when rentals are producing a much higher rate of return.

I think this is a valid strategy, but it requires some serious income.    I have an elderly family member in LTC right now.   $14K per month.   Soon we will have to make some very difficult choices.

[Abe]

If I had a severe enough disability that I'd need 24 hour long-term care at my current age (30), I'd refuse care in an attempt to end my suffering.  I see enough suffering in the ICU from patients slowing dying of necrotic sacral pressure ulcers because they can't move that I'd avoid that fate at all costs. If it was something where I needed assistance with some activities but otherwise were able to move around and do things, then I'd try to find a job that would support that limitation. If I need long term care after 65, I will definitely refuse medical care (as would 80%+ of physicians on a recent survey).

[oldtoyota]

If I still had the physical ability, I would also find a way to end my suffering. From what I have seen when people are dying is that doctors are trained to extend life and will often do so even if it's not best for the patient. I learned that the hard way.

If I don't know who I am and can't care for myself, I'm cool with someone deciding to end it for me. Nursing homes smell terrible, and I have never seen one I'd want to live in.

[oldtoyota]

Why? What do those states do differently?

I believe they allow, or at least are more tolerant of, doctor-assisted suicide.

Assisted suicide is legal in those states.  I highly recommend watching the documentary "How To Die In Oregon"--I watched it on Amazon Prime and I'm pretty sure it's on Netflix too.  Last fall a young woman named Brittany Maynard made the news because she issued a public statement about moving to Oregon to end her life because she was suffering from inoperable brain cancer.

http://www.cnn.com/2014/10/07/opinion/maynard-assisted-suicide-cancer-dignity/

If I have the choice to go painlessly rather than suffering, I'll take it.

Thank you for the reminder regarding that story. I knew about the woman yet had forgotten she went to Oregon. That'll be my plan, too. I have no desire to endure a long path to death if I can avoid it. I've seen it up close, and it's nasty.

[AlwaysBeenASaver]

As I understand it, unfortunately, you have to be within a specified number of months (6?) of death, certified by multiple doctors, before you are eligible for assisted suicide.

[Sid888]

Ever wonder what would happen to you -- and to your stash -- if you had a disabling stroke or crippling accident?  Not years in the future, when you are "old",  but right now?  It could happen, you know.

If that should happen to me, my long term care insurance policy will keep my stash from getting devoured and make sure I am (reasonably) properly cared for.  It's not a perfect solution,  and it costs me almost $200 a month.  But it gives me unconflicted peace of mind.

What's your game plan if the unthinkable happens to you?  What will you do?  How will you fund it?

This is a gigantic stash buster!

You may want to get a 5 year plan (with cheaper premiums) and then transfer assets to a trust to avoid medicaid look back period in the event of a problem like the one you described above.

[aj_yooper]

My ltc salesperson told me that there is a 70% chance that at least one individual in a married couple over 65 would require ltc; 80% of the residents in nursing homes are female and most are widows.  Bad odds, high costs.  I would not want to underwrite that kind of insurance.  So it probably makes more sense to insure females.

Durable power of attorney for health care and property definitely needed, as well as a living will and Five Wishes documents.  It's best to get this done even before considering ltc insurance.  This is not a fun topic.

[Janie]

Another perspective on LTC costs. The stats from the American Geriatrics Society near the end of the article are worth a look http://assetbuilder.com/scott_burns/will_nursing_care_take_all_your_money_maybe_not

[Reyes01]

My long term care plan is to continue living in Oregon:-)

[Retired To Win]

If I had a severe enough disability that I'd need 24 hour long-term care at my current age (30), I'd refuse care in an attempt to end my suffering... If it was something where I needed assistance with some activities but otherwise were able to move around and do things, then I'd try to find a job that would support that limitation. If I need long term care after 65, I will definitely refuse medical care...

Well, there's another more "optimistic" scenario, which no one in the thread so far seems to have examined.  And that is the scenario of being temporarily but not short-term disabled due to a mishap.  It happened to my 50-year old friend, Victor, who got into a head-on collision through absolutely no fault of his own and then required almost two years of long term care to get back to ambulatory normalcy.  Obviously (?), no one here is saying they would consider ending their lives in such a situation.  But take out your calculator and see what would happen to your stash if this happened to you.

Multiply $160 a day (a modest nursing home's average daily rate) times 365 days in a year times 2 years.  That's almost $117,000 sucked out of Victor's stash -- while he was unable to work to bring in any income.  That's not a risk I am taking.

I'd rather pay my $176 a month (as I am doing) for a 10-year LTC policy.  That's $2112 a year, with practically all of it being tax-deductible.  It would take me almost 50 years of paying those premiums to offset the costs that poor Victor has had to swallow due to a lack of long term care insurance.

So, word of advice.  Stop thinking about this as if it were strictly an old-age or terminal condition situation. Because it is not.

[oldtoyota]

If I had a severe enough disability that I'd need 24 hour long-term care at my current age (30), I'd refuse care in an attempt to end my suffering... If it was something where I needed assistance with some activities but otherwise were able to move around and do things, then I'd try to find a job that would support that limitation. If I need long term care after 65, I will definitely refuse medical care...

Well, there's another more "optimistic" scenario, which no one in the thread so far seems to have examined.  And that is the scenario of being temporarily but not short-term disabled due to a mishap.  It happened to my 50-year old friend, Victor, who got into a head-on collision through absolutely no fault of his own and then required almost two years of long term care to get back to ambulatory normalcy.  Obviously (?), no one here is saying they would consider ending their lives in such a situation.  But take out your calculator and see what would happen to your stash if this happened to you.

Multiply $160 a day (a modest nursing home's average daily rate) times 365 days in a year times 2 years.  That's almost $117,000 sucked out of Victor's stash -- while he was unable to work to bring in any income.  That's not a risk I am taking.

I'd rather pay my $176 a month (as I am doing) for a 10-year LTC policy.  That's $2112 a year, with practically all of it being tax-deductible.  It would take me almost 50 years of paying those premiums to offset the costs that poor Victor has had to swallow due to a lack of long term care insurance.

So, word of advice.  Stop thinking about this as if it were strictly an old-age or terminal condition situation. Because it is not.

Thank you for raising this topic again. I find that folks here generally don't want to to talk/think about it. I figure it's because the board skews young.

I had DI and think it's a good idea to have it. We got rid of it when I got laid off and had to cut back on expenses. Eventually, our assets would cover a lack of income. However, I've figure we're effe'd in terms of US medical care if anything goes really wrong. Our medical system is set up to bankrupt people.

[Gin1984]

My long term care plan is to continue living in Oregon:-)

My long term care plan is to move to Oregon too (and I know where you live :-)!!). But seriously, while I would like to end it all if I was permanently physically or mentally disabled, I think that there are lots of sitations where they (medical personel) won't let that happen. Say you had stroke or altzheimers and are completely unable to care for yourself but technicaly don't have a life ending disease or injury. I don't think they'd pull the plug if you could live for decades - even if you needed round the clock care. Or if, as stated above, your illness or accident is temporary and you may be able to function and care for yourself again at some later point in life. They probably won't allow you to die if that's the case. So in both cases you may have to live, and pay big bucks, for many years in some kind of nursing home situation even in a state like Oregon that allows euthanazia.

It depends, if your stroke means you need medical equipment to live, your DoA may be able to pull the plug.  For such things as dementia, you are right.

[dude]

Another perspective on LTC costs. The stats from the American Geriatrics Society near the end of the article are worth a look http://assetbuilder.com/scott_burns/will_nursing_care_take_all_your_money_maybe_not

Yeah, I shared this in another post recently.  I have LTC insurance because it's pretty cheap for me -- @$50/month, and it's probably a good deal for me now if I needed it before I retired.  But frankly, after I retire, my pension and savings should easily cover it, and even moreso once I hit SS age.  But if I found myself in a long-term disabled state, I'm checking the fuck out.  I don't want to "live" that way, thank you very much.  My wife, on the other hand, does not have a policy, so things would get trickier there, and frankly, the strategic divorce route is probably where we'd go.

[Abe]

If I had a severe enough disability that I'd need 24 hour long-term care at my current age (30), I'd refuse care in an attempt to end my suffering... If it was something where I needed assistance with some activities but otherwise were able to move around and do things, then I'd try to find a job that would support that limitation. If I need long term care after 65, I will definitely refuse medical care...

Well, there's another more "optimistic" scenario, which no one in the thread so far seems to have examined.  And that is the scenario of being temporarily but not short-term disabled due to a mishap.  It happened to my 50-year old friend, Victor, who got into a head-on collision through absolutely no fault of his own and then required almost two years of long term care to get back to ambulatory normalcy.  Obviously (?), no one here is saying they would consider ending their lives in such a situation.  But take out your calculator and see what would happen to your stash if this happened to you.

So, word of advice.  Stop thinking about this as if it were strictly an old-age or terminal condition situation. Because it is not.

Firstly, I understand you may have strong feelings on this subject given you friend's condition. Please do not assume that I am thinking of this in a particular way and thanks for pointing out that there are nuances. Given my line of work, I am not thinking of this as a strictly old-age situation. On the contrary, I am in a better position than most to know that is not an old-age or necessarily terminal condition. Caring for people who have suffered severe trauma, I have an understanding of the significant efforts required for even small recovery. I personally would not necessarily pursue that if I would remain a burden on my family, depending on the circumstances and nature of injury. Nothing is obvious in these discussions, so your (?) is warranted.

[EdwardMonroe]

I actually regretted that I did not invest an insurance for long term care. Right now, it is hard for me to look for another options and to purchase and understand the inflation protection. But my kids are taking over me, as they are paying skilled care facility through my savings. It's so ill-timed that I am not eligible to get the Medicaid. I did not make wise decisions before because I've already availing insurances for auto and house. If I think of it decades ago, this issue will be unproblematic for me.

[Argyle]

Note that in places like Oregon, assisted suicide would not be possible for many people with Alzheimers or serious conditions.  You have to be certified competent to make the decision, which someone with dementia might not be.  And you have to be able to take the drug yourself, not have it administered to you by someone else.  And they are strict and not sloppy about the conditions, because they don't want abuses of the law, and of course abuses would be a strong reason for people to shut the law down.  But there are a lot of conditions in which these would stop someone being able to commit assisted suicide. 

[Pooperman]

Commonly in the U.S., the disabled younger population ends up with an SSI check (possibly SSD) and Medicaid is the health insurance.

Just a heads up that in order to collect SSDI you have to have worked and paid into the system in the 10 years prior to your disability. So if a person retires early and 10 plus years later becomes disabled they may not be able to get SSDI. I'm in this category (and it says so on my annual SS statement).  So would be SOL on disability payments if needed.  I also don't have LTC insurance and figure that, once my assets were gone I would have to go on Medicaid for nursing home/LTC. No family or heirs either so that will be my plan. I do live in a state (Calif) that allows a person to keep their home and some assets (if single) and all seperate spousal assets, benefits and joint home (if married) when you go on medicaid for nursing/LTC. They will collect those assets upon your death or the death of you spouse.

From a SSDI website:
You must meet the "recent work" test and the "duration of work" test in order to qualify for SSDI. Here's the recent work test: Typically, if you are 31 or older, you must have worked at least 5 of the last 10 years to keep up your SSD coverage. Put another way, you will need to have earned 20 credits (one quarter of work equals one credit) in the 10 years immediately before you became disabled

This is not entirely true. If the individual is disabled prior to turning 18, the ssdi/ssi award is based on their highest earning parent's SS. It's either 18 or 21, I forget. Either way, if the person has never worked and was disabled as a child, they are eligible for ssdi/ssi.

[PatStab]

One thing to keep in mind is that long term care premiums aren't fixed like life insurance can be.  It could (and does) go up.  I've had clients who have had 40% increases have to drop their coverage.  Not to say that threre's no value there, but companies are starting to find out that LTC is getting more and more expensive and they're not in the business of losing money.  A big issue is Alzheimers.  You can be in a facility for 20+ years with that one.  (One of the reasons that lifetime benefits are getting rarer)  The average stay is less than 2 years.

You just can't just walk away anymore, I believe even with a divorce there will be a look back and you are going to have to spend down, you aren't getting Medicaid that easy anymore.  And medicare only pays 90 days and they are done.  My husband says he wants to end it in that situation and knowing him he probably would. 

LTC we looked at years ago, its limited, its expensive, and premiums for many people are getting to high for them to keep it up.  Also lots of the companies are going bankrupt over not being able to pay the costs.

For me I don't know, but it would be devastating to us and our finances plus we have DD who is mentally challenged.  Hubby is talking about working longer now to care for her. 

We have a good sum of money but I doubt we are able to have enough for the rest of our lives and doubt we can pass on any of it. 

[Retired To Win]

I actually regretted that I did not invest an insurance for long term care. Right now, it is hard for me to look for another options and to purchase and understand the inflation protection. But my kids are taking over me, as they are paying skilled care facility through my savings. It's so ill-timed that I am not eligible to get the Medicaid. I did not make wise decisions before because I've already availing insurances for auto and house. If I think of it decades ago, this issue will be unproblematic for me.

That's the thing.  The longer you wait to get an LTC policy, the higher the premiums get.  This is the kind of thing that can become totally unaffordable -- or even impossible -- to get if one waits too long.  I'd rather err on the side of caution.

Oh, and there's a modest tax-advantage benefit to carrying an LTC policy.  Many states (mine included) allow you to take a substantial itemized deduction for LTC premiums.  IRS regs, for the U.S. tax return, allow from $370 (age 41) to $4660 (age 71) in premiums to be taken as a tax deduction.

[tobitonic]

One thing to keep in mind is that long term care premiums aren't fixed like life insurance can be.  It could (and does) go up.  I've had clients who have had 40% increases have to drop their coverage.  Not to say that threre's no value there, but companies are starting to find out that LTC is getting more and more expensive and they're not in the business of losing money.  A big issue is Alzheimers.  You can be in a facility for 20+ years with that one.  (One of the reasons that lifetime benefits are getting rarer)  The average stay is less than 2 years.

You just can't just walk away anymore, I believe even with a divorce there will be a look back and you are going to have to spend down, you aren't getting Medicaid that easy anymore. And medicare only pays 90 days and they are done.  My husband says he wants to end it in that situation and knowing him he probably would. 

LTC we looked at years ago, its limited, its expensive, and premiums for many people are getting to high for them to keep it up.  Also lots of the companies are going bankrupt over not being able to pay the costs.

For me I don't know, but it would be devastating to us and our finances plus we have DD who is mentally challenged.  Hubby is talking about working longer now to care for her. 

We have a good sum of money but I doubt we are able to have enough for the rest of our lives and doubt we can pass on any of it.

What's this about Medicare only paying for 90 days? Ninety days in a nursing home?

[Willbrewer]

I've had a LTC policy for the last 15 or 20 years. It was offered by my employer at the time for about $30 a month. Luckily, it was a plan (with John Hancock) that could be carried with you after the employment ended, and I kept it. I've upgraded the plan to higher, more realistic limits a few times over the years, and now pay $75 per month. That gives me something like $400K-$500k total benefits over 3 or 4 years time. I'm glad I kept the policy alive, since more than one of my ancestors had extended nursing home stays.

[gaja]

How would this scenario look in a welfare state?

Income:
1. The first year I would get 100 % paid sick leave
2. If there was hope I could get back to work, the next four years I would get 66 % "work consideration pay"
3. If there was no hope for going back to work, or it took more than four years to get there, I would get disability pay, between 60 and 70 % of my last pay check

Expences:
1. All medical care and medication is free, including physical therapy. (Above a nominal co-pay of <$500/year).
2. Older people who live in assisted facilities pay approximately 80% of their income for the living expences and care (capped at ~$60 000/year). If they have no income, they pay nothing. I don't know if the same would apply to people with severe diabilities.
3. My student loans would be forgiven, no tax owed.

In addition, I have disability insurances, both private and through work, that would increase the pay to about 80 % of my last paycheck, and give my husband a single payout of $200 000.