Despite health care and aging experts’ best efforts to educate consumers on the importance of long-term care planning and/or insurance coverage, uptake of the policies traditionally has been notoriously low.
Add in the recent demise of the CLASS Act — a provision of the health care reform law that would have created a voluntary LTC purchase program, but was shelved due to lack of funding — and you get lack of government support added to an apathetic public, not a great combination for boosting LTCI sales.
However, an online commentary from author and Forbes contributor Howard Gleckman points out that according to research by two economists, buying LTC in many cases may not only be unnecessary but also economically inadvisable.
The researchers, Jeff Brown and Amy Finkelstein, conclude that it LTC coverage doesn’t make much sense for low-income workers since they’ll be covered by Medicaid, or for high-income workers, since they can afford to purchase private care on their own without the benefit of LTCI.
In addition, Brown and Finkelstein calculate that LTCI costs more than the potential benefit, Gleckman writes. The pair find that a 65-year-old LTCI buyer would get back just 68 cents for every dollar paid in premiums. By comparison, buying a life annuity would pay dividends of 75 cents to 85 cents, the researchers find.
Still, Gleckman writes, LTCI is a pretty good deal for women, who would get 87 cents for ever premium dollar, compared to only 45 cents for men. That said, Brown and Finkelstein conclude that Medicaid would cover three-quarters of LTC benefits for a typical woman.
As Gleckman points out, it’s not like Medicaid is the pot of gold at the end of the rainbow in terms of comprehensive LTC coverage. But at the same time, it’s hard to deny the appealing aspect of the fact that it’s … well … free. And, in this economy, free counts for a lot.
What do you think? Is buying private LTC coverage necessary? Share your thoughts in the comments.
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15 Comment(s)
Posted by: Toolman11 | May 8, 2012 5:06 AM
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Posted by: mivpl s | April 27, 2012 6:55 AM
government support added to an apathetic public, not a great combination for boosting LTCI sales.langweilig
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Posted by: tanteisan | April 10, 2012 6:49 AM
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Posted by: l.hauri | April 9, 2012 8:04 AM
LTC coverage doesn't make much sense for low-income workers since they'll be covered by Medicaid, or for high-income workers, since they can afford to purchase private care on their own cialis online
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Posted by: jack45 | April 2, 2012 10:56 AM
There is so much that goes into the picking the right insurance. You really have to do your homework on this. This is so important for your future. Fundraising Toronto
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Posted by: Internet Advertising | March 27, 2012 9:55 AM
I believe LTC is very necessary. It helps a lot especially when you get older. It has proved to be very useful and helps you save a lot on your hospital bills. ------------------------------------------ Lead Generation
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Posted by: jack45 | March 20, 2012 1:48 PM
I think the long term care insurance is so important to have. You have to keep this going in the future. You will benefit so much from it in the future. Breckenridge Ski In Ski Out
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Posted by: Prabir B | March 13, 2012 7:35 AM
Insurance coverages are must. Especially health insurance. You could be prepared for any sudden illness or some other medical emergency if you have a good health insurance policy. But you need to assess the pros and cons of an insurance plan before you get one. I was looking for information on NRIOL when I saw your post.
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Posted by: l.hauri | February 20, 2012 8:28 AM
it is true that a long term insurance is better, but most of us will choose a shorter period. I will try to change my future strategy. yacht charters
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Posted by: james andy | February 12, 2012 11:43 PM
This post is very important and valuable for me because i was searching about the LTC coverage from past many days and at last i found it. I am really interested in this policy. How i join this policy. Thesis Help | Dissertation Help
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Posted by: james andy | February 12, 2012 11:30 PM
I think LTC coverage is the best policy because due to this policy you can save your future. It is a good step, i appreciate it very much. Research Paper Writing | Term Paper Writing | Essay Help
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Posted by: Linda Riddell | January 25, 2012 12:26 PM
The high net worth customers could benefit from having LTCI, because they would not have to spend their assets on care. They are the exception, rather than the rule. Many people will do just as you suggest -- rely on Medicaid to cover the cost. It's what I tell my own relatives to do!
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Posted by: pkdavis | January 25, 2012 10:40 AM
Getting LTCi comparisons is the best way to see all that your state has to offer. A great place to get these is http://ltcshop.com/ Scott really helped me choose the best policy for myself and helped me protect my financial future.
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