Long Term Care Insurance – A Personal Story
Long Term Care Insurance – A Personal Story
By Robyn Leonard
May 15, 2020 6:30:00 AM
Growing up in Alaska was definitely different than in other states in so many ways. One of the things you come to realize, as you age into adulthood, is how expensive things are there compared to other states. A trip to a local fast food restaurant will give you a good indication. A child’s meal pack at the local drive-thru can be as much as a $5 more compared to prices in “the states.” Everything is more expensive in Alaska.
I grew up in Alaska, but went to college in Oregon and never moved back home. We love to visit in the summer, but I don’t plan to live there year-round again.
My mom and her husband are in their mid-seventies and in great health. My step-dad still runs 50-mile races! This past summer I went to visit them and one of the conversations we had was about their retirement and care plans. We discussed how their properties were going to be distributed among my brother and me and our step-dad and his two children. We talked about how they thought they would pay for their care when they should need it. Since I work in the insurance industry, I was able to easily research the cost of care in their area prior to my visit. I was not surprised at all by the cost of home care or assisted living because, as with most other services and items, it was just slightly more than it is in the rest of the U.S. (or “lower 48” as Alaskans refer to it). The shocker was the $351,495 it currently costs PER YEAR for nursing home care! I know that the average need for care is about three years. I also know, on a personal level, that we have a family health history of dementia and Alzheimer’s. I would assume that my mom will potentially need at least six years of care.
When you do the math, that is just over $2 million ($2,108,970) total cost – TODAY. Let’s assume she doesn’t start needing care for 10 to 15 years. Those costs will have increased by about three to five percent each year until that time.
I would love to say that I would move back to Alaska and care for my mom, but that is just not possible. We have three grown children who will be starting their own families soon. We also have my husband’s family here who are a bit older than my mom and her husband and will also need assistance. My step-dad is another component of the bigger picture; he has his two children, one who lives in Alaska and one who does not. So, what is the plan for him and his care?
I know I am not the only one in this kind of complicated situation. In fact, I am sure that I am in the majority, not the minority here. Our lives and our families can get complicated. What we do need to realize as our parents (and ourselves) get to a certain age, is that we need to have these conversations. We need to plan. We need to realize that we are not invincible. Seventy percent of people who reach age 65 and older WILL need long-term care. This is not a make-believe number. This is reality. This is my reality. This is your reality.
My mom and I had a very good conversation about her potential needs and she has let me know what she would like to see happen once she does need care. I also told her it doesn’t really mean anything until she puts it into a legal document. She agreed and she and her husband have set up an appointment with their lawyer. They will then share the documents with each of their children.
My personal experience has led me to really understand the complexities of how to navigate the discussion about long term care. There are many ways to mitigate the issues. There is no right and wrong; just make sure you are having this conversation with your family. Instead of facing that annual cost of $351,495 per year for care, consider your option of paying a smaller monthly premium for long-term care insurance that will help pay for that total cost. As an employer, you can offer your employees easier access to a plan with better pricing and payroll deductions. If you have not considered this before, now is a great time to look at it. One thing people don’t realize is that the premiums for long-term care insurance are based on the age in which you purchase coverage. None of us are getting any younger. Now is the perfect time to start these discussions.