What happens if your parent's resources run out before the long term care insurance does?

My mother's long term health care insurance has a rider on it that once she's in a nursing home for so long, she no longer has to pay the monthly premium which has been the case for almost four years. Her coverage is lifetime.

The problem I see is that the long term insurance does not cover all of the cost of her being in the nursing home. That is being paid for from her own resources which at some point will run out if she lives that long.

Will medicaid pay what her insurance does not pay for her care once her private funds are depleted?

The bad news: We all know that once you stop paying an insurance premium, the insurance company will automatically cancel whatever transaction you once did. Whatever the reasons are, it is highly unlikely that the company will allow a refund.

The good news: There are companies that offer a non-forfeiture benefit to their customers. By law, a non-forfeiture plan enables an individual to receive limited coverage on his/her insurance depending on the amount of time he/she had paid. This is like the-less-you-pay-the-less-you-get scenario.

If you want to more, you should start reading some materials about complete long-term care

I have to say "God bless you for helping your mother going through your life savings". Please do yourself a favor and buy long term care for yourself since you can before age 70. Also, make sure that the agent who is selling you Long term care also explains all riders. I specialize in long term care and been doing it for a while. I see insurance agents come and go and most of them don't know nothing about long term care and still selling it. If you like to get quotes and protect yourself of not depleting your life savings, please contact me.

Newer Long Term Care Insurance (LTC) policies can be Partnership Program certified – allowing you to protect your assets away from Medicaid without a look-back period. In almost all states that have Partnership Programs, the amount of assets Medicaid will disregard is equal to the amount of the benefits you actually receive under your LTC Partnership Program certified policy.

Pricing for the same level of long term care coverage can vary greatly between companies, with some companies charging over 100% more than others. Work with an independent insurance agent that can provide quotations from numerous companies. Let us research the market and design a long term care insurance solution to meet your needs and budget at:


Aaron

Bless you for taking on this job and caring directly for your mother. Please do not risk your own life savings for her care, though. Who will be able to assure you of quality care if you are in the same situation later?
Is there a possibility of a reverse mortgage (RM), based on you being over 62? Could the cashout from the RM fund an immediate annuity based on her health? For example, the carrier assumes she may have 2 years to live, and you need an extra $2000/month to bring in extra help or for her to go to a private pay assisted living. The amount needed to fund this annuity would be $2000 x 24 months = $46,000. The $2000/mo. will be paid as long as she lives. Guaranteed minimums can be added.
Otherwise, spending down until she reached Medicaid asset limits will allow her to go to a nursing facility which will accept her social security income and any other pension. The best way to get a quality skilled facility is to pay regular cost for a few months before running out of funds, or wait until there is a fall or other health issue, then she can go in to a good nursing facility initially with Medicare.
Waiting to run out of money at home can be a problem, as quality nursing homes often will not take residents who cannot pay initially. Welfare rates can be lower than their out of pocket costs.

Ah. that makes it clearer, cmagnum. I don't know if/how Medicaid works in conjunction with an LTC policy. I guess that is the question, isn't it? Once all her resources are gone, she would presumably qualify for Medicaid. Can you talk to the director of NH about what your mom's options are once she can no longer afford to make up the difference between the LTC coverage and the NH cost? As you say, it may never happen, but it will be better to know the options ahead rather than deal with it in a crisis mode. Another source of information might be your state's department on aging.

I would be interested in what you find out. Many of us have policies that looked like adequate coverage at the time we took them out, but may not keep pace with increasing long term care costs. So if not for our loved ones, many of us would be interested in this topic. I hope you will take the time to share.

Good luck to you.

I'm not sure that I was entirely clear with my question. My mother has long term care insurance and because of a rider, no longer pays premiums. Also, she bought a policy that is a lifetime policy. However, the money in the bank and securities may not last to pay the difference between the cost of the nursing home and what the LTC policy pays. This may or may not take place, but if it does I need to have a plan.

From my research on this topic, you may be able to request a reduction in the policy's benefits so the premiums are affordable. You can do this by reducing the daily benefit amount, the number of years the policy will be in force or make other permissible changes (allowed by the LTC company) to try and make the premium more affordable.
I hope this would be a answer to the problem especially if they have paid the premium for the LTC policy for many years and do not want to lose the investment in the policy by needing to cancel.

Is it the case, cmagnum that the NH where your mother is does not take Medicaid? That would be the obvious answer. DT, I assume that the ALs don't take Medicaid and don't have SNF sections that do?

That place where you both find yourselves -- between a rock and a hard place -- is becoming increasingly crowded and it is going to get worse, I'm afraid.

I don't know the answers, but I strongly urge you both to protect your ability to take care of yourselves financially.

If Mom has to go to one of those country nursing homes, DT, I think then you take on a strong advocate role and see to it that she gets the great care she deserves, even if the home does not have a reputation for great care.

Isn't that where medicaid would kick in? DT your funds don't belong to your mother, so if she is technically out of funds can she not qualify for medicaid? Does the house belong to you or mom?

I accidentally hit submit before I was finished proof-reading, I also wanted to add that in our community we have not much choice, there are assisted living facilities that cost a lot more than just her S.S., those county facilities who only take S.S. are not very good, in fact, mom will consider going to one of those as a certian death warrent because of my dad died in one of them (2 choices). So, I feel I am between a rock and a hard place. I want to keep her home as long as I can, but she is fast approching a condition where that may not be possible. I have also looked into hospice, there are places that have separate facilities to take the patient to, but the one in our county through the only hospital in town does not, they send hospice workers to the house. No help there, either. Am I to spend myself into bankrupcy? I should add that we are not a religious family, I do not feel comfortable in "putting my faith in God" and letting the chips fall where they may, it is not in my province. There will be on one to look out for me (I should add that I have a couple problems of my own.) if I should find myself in the same situation. I do not want Anyone to feel obligated like that anyway. I have always taken care of myself.

I am wrestling with a question similar to this now. My mom is 94, I am 68, her only caregiver and in retirement also. Caregiving for her is pretty much a 24/7 job, and before anyone responds about getting help either for care or financial, I have tapped as much as I can with advice from her doctor and from our county senior center. So far, we are OK, getting on, but I am worried about if I have to put her in assisted living or nursing home. I have few resources myself, a very modest IRA that I only dip into to pay taxes on the house and necessary repairs and in the last few years it has shrunk alarmingly - I had new windows installed year before last, and a new furnace this year for instance. The house itself is small and in this economy, not worth very much even if I can sell it, in our town there are houses that have been on the market for a couple years, so even if I had to sell it it may take time. If I start dipping into my IRA to support her in an assisted living, even if they take her S.S., my IRA will only last for a couple years, at very MOST. Im I being selfish to want to protect my few resources for the days when I may not have her anymore? She would say no, but I have a lot of guilt that I do not want to bankrupt myself before I am even able to begin to enjoy my own retirement.

Yes for the LTC does not cover all of her needs right now.

Are you thinking that the LTC insurance will not cover all of her needs at that point?