StarTribune Article
January 24, 2008
January 24, 2008
| Long Term Care Insurance |
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Long-term care: How to pay for the last years
Newman Long Term Care's Marlys Fiterman featured in StarTribune article
"Long-term care: How to pay for the last years"
Perhaps you have already read the front page of Thursday, January 24, 2007
StarTribune. Maryls was privileged to have helped both sisters interviewed,
providing them the peace of mind they convey in the article. This article
reinforces the need for long term care planning with Long Term Care
Insurance and I thought you might find this a useful tool in starting the
conversation with your clients.
As always, Marlys and I are here to be of service to you.
Please read the StarTribune article below:
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
PAYING FOR LONG-TERM CARE
After watching their mom's assisted-living costs soar to $70,000 a year as her
dementia deepened, sisters Janet Sullivan and Lisa Richardson decided this
month to buy long-term care insurance policies for themselves.
"We have kind of a social responsibility to do what we can to prepare for our
future -- to go on public assistance for our own care only as a last resort,"
said Sullivan, 50, of Wayzata. "If we're not going to overburden the next
generation, we have to start planning now."
Without fanfare, the state this month has quietly launched an effort to entice
more Minnesotans to buy private long-term care insurance.
Called the Long-Term Care Partnership -- now approved in 16 states -- the
program is aimed largely at helping baby boomers avoid catastrophic costs of
nursing homes or assisted living.
"At the same time, the state hopes to rein in the $900 million a year in
Medicaid costs of caring for aged, frail Minnesotans driven into poverty by
long-term care costs," said Loren Colman, assistant commissioner for
continuing care at the state Department of Human Services.
Under the program, once Sullivan's policy pays out its $365,000 benefit to
cover her care, she can shelter an equal amount of cash assets and still
qualify for Medicaid.
Without the qualifying long-term care policy, she would have to spend down
her assets until no more than $3,000 remained before the state would pay for
her care.
Coverage has broadened
Many of the 180,000 Minnesotans who already have long-term care policies
qualify for the Partnership benefit, Colman said.
No longer just a tool to pay for nursing-home care, policies now typically also
cover home health care, assisted living, adult day care and sometimes even
care by family members.
The policies are expensive -- each sister pays about $2,800 a year in
premiums -- but so is long-term care.
On average, nursing-home care in Minnesota costs about $55,000 a year,
with prices restricted by the state; assisted living is about $35,000 a year, but
varies widely.
State government policymakers are concerned that Medicaid financing of
long-term care will create a crisis in another few decades, when baby
boomers will swell the population of over-85 Minnesotans at a rate seven
times the overall population growth.
How plans qualify
There is no minimum coverage amount that a plan must offer to qualify for the
Partnership program.
But any policy bought by someone under age 61 must provide "meaningful"
annual compound inflation protection -- the benefit typically growing 5 percent
a year. Policies for those ages 61 to 74 must have some inflation protection.
Sullivan's and Richardson's policies could pay up to $365,000 -- $200 a day
for five years, going up 5 percent a year with inflation protection.
Their mother, Elaine Richardson, is 75 and she's still able to pay for her own
care, Sullivan said. "But Lisa and I aren't married, we don't have kids, and we
know we may need care like that someday. Getting insurance feels really
good."
First plans approved
Although action had been expected last spring, this month the state
Commerce Department approved plans offered by six insurance companies,
with seven more firms awaiting approval.
But many insurance agents aren't waiting. Marlys Fiterman in Bloomington
has been selling policies and assuring customers that they will be eligible for
the program's benefits.
"We know the law, the Partnership rules, and we got the required Partnership
training," said Fiterman, 62, a retired music teacher. She became an
insurance agent specializing in long-term care policies seven years ago after
her mother developed Alzheimer's.
The concept began as a state-federal experiment in four states in the early
1990s, and Minnesota soon sought to join in. But federal officials blocked
expansion of the program until 2006. Eventually, the program will allow
policyholders who qualify to use the Partnership benefit in any cooperating
state.
No longer just a tool to pay for nursing-home care, policies now typically also
cover home health care, assisted living, adult day care and sometimes even
care by family members.
The policies are expensive -- each sister pays about $2,800 a year in
premiums -- but so is long-term care.
On average, nursing-home care in Minnesota costs about $55,000 a year,
with prices restricted by the state; assisted living is about $35,000 a year, but
varies widely.
State government policymakers are concerned that Medicaid financing of
long-term care will create a crisis in another few decades, when baby
boomers will swell the population of over-85 Minnesotans at a rate seven
times the overall population growth.
How plans qualify
There is no minimum coverage amount that a plan must offer to qualify for the
Partnership program.
But any policy bought by someone under age 61 must provide "meaningful"
annual compound inflation protection -- the benefit typically growing 5 percent
a year. Policies for those ages 61 to 74 must have some inflation protection.
Sullivan's and Richardson's policies could pay up to $365,000 -- $200 a day
for five years, going up 5 percent a year with inflation protection.
Their mother, Elaine Richardson, is 75 and she's still able to pay for her own
care, Sullivan said. "But Lisa and I aren't married, we don't have kids, and we
know we may need care like that someday. Getting insurance feels really
good."
First plans approved
Although action had been expected last spring, this month the state
Commerce Department approved plans offered by six insurance companies,
with seven more firms awaiting approval.
But many insurance agents aren't waiting. Marlys Fiterman in Bloomington
has been selling policies and assuring customers that they will be eligible for
the program's benefits.
"We know the law, the Partnership rules, and we got the required Partnership
training," said Fiterman, 62, a retired music teacher. She became an
insurance agent specializing in long-term care policies seven years ago after
her mother developed Alzheimer's.
The concept began as a state-federal experiment in four states in the early
1990s, and Minnesota soon sought to join in. But federal officials blocked
expansion of the program until 2006. Eventually, the program will allow
policyholders who qualify to use the Partnership benefit in any cooperating
state.
So far, the Partnership has had only a modest effect on long-term policy sales
or Medicaid expenses in other states.
"We're in this for the long term," said Colman, whose Human Services
Department is working on a public-education campaign to start in the next few
months. "How to pay for long-term care -- either the state or individuals -- is
an issue that won't go away soon."
Newman Long Term Care's Marlys Fiterman featured in StarTribune article
"Long-term care: How to pay for the last years"
Perhaps you have already read the front page of Thursday, January 24, 2007
StarTribune. Maryls was privileged to have helped both sisters interviewed,
providing them the peace of mind they convey in the article. This article
reinforces the need for long term care planning with Long Term Care
Insurance and I thought you might find this a useful tool in starting the
conversation with your clients.
As always, Marlys and I are here to be of service to you.
Please read the StarTribune article below:
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
PAYING FOR LONG-TERM CARE
After watching their mom's assisted-living costs soar to $70,000 a year as her
dementia deepened, sisters Janet Sullivan and Lisa Richardson decided this
month to buy long-term care insurance policies for themselves.
"We have kind of a social responsibility to do what we can to prepare for our
future -- to go on public assistance for our own care only as a last resort,"
said Sullivan, 50, of Wayzata. "If we're not going to overburden the next
generation, we have to start planning now."
Without fanfare, the state this month has quietly launched an effort to entice
more Minnesotans to buy private long-term care insurance.
Called the Long-Term Care Partnership -- now approved in 16 states -- the
program is aimed largely at helping baby boomers avoid catastrophic costs of
nursing homes or assisted living.
"At the same time, the state hopes to rein in the $900 million a year in
Medicaid costs of caring for aged, frail Minnesotans driven into poverty by
long-term care costs," said Loren Colman, assistant commissioner for
continuing care at the state Department of Human Services.
Under the program, once Sullivan's policy pays out its $365,000 benefit to
cover her care, she can shelter an equal amount of cash assets and still
qualify for Medicaid.
Without the qualifying long-term care policy, she would have to spend down
her assets until no more than $3,000 remained before the state would pay for
her care.
Coverage has broadened
Many of the 180,000 Minnesotans who already have long-term care policies
qualify for the Partnership benefit, Colman said.
No longer just a tool to pay for nursing-home care, policies now typically also
cover home health care, assisted living, adult day care and sometimes even
care by family members.
The policies are expensive -- each sister pays about $2,800 a year in
premiums -- but so is long-term care.
On average, nursing-home care in Minnesota costs about $55,000 a year,
with prices restricted by the state; assisted living is about $35,000 a year, but
varies widely.
State government policymakers are concerned that Medicaid financing of
long-term care will create a crisis in another few decades, when baby
boomers will swell the population of over-85 Minnesotans at a rate seven
times the overall population growth.
How plans qualify
There is no minimum coverage amount that a plan must offer to qualify for the
Partnership program.
But any policy bought by someone under age 61 must provide "meaningful"
annual compound inflation protection -- the benefit typically growing 5 percent
a year. Policies for those ages 61 to 74 must have some inflation protection.
Sullivan's and Richardson's policies could pay up to $365,000 -- $200 a day
for five years, going up 5 percent a year with inflation protection.
Their mother, Elaine Richardson, is 75 and she's still able to pay for her own
care, Sullivan said. "But Lisa and I aren't married, we don't have kids, and we
know we may need care like that someday. Getting insurance feels really
good."
First plans approved
Although action had been expected last spring, this month the state
Commerce Department approved plans offered by six insurance companies,
with seven more firms awaiting approval.
But many insurance agents aren't waiting. Marlys Fiterman in Bloomington
has been selling policies and assuring customers that they will be eligible for
the program's benefits.
"We know the law, the Partnership rules, and we got the required Partnership
training," said Fiterman, 62, a retired music teacher. She became an
insurance agent specializing in long-term care policies seven years ago after
her mother developed Alzheimer's.
The concept began as a state-federal experiment in four states in the early
1990s, and Minnesota soon sought to join in. But federal officials blocked
expansion of the program until 2006. Eventually, the program will allow
policyholders who qualify to use the Partnership benefit in any cooperating
state.
No longer just a tool to pay for nursing-home care, policies now typically also
cover home health care, assisted living, adult day care and sometimes even
care by family members.
The policies are expensive -- each sister pays about $2,800 a year in
premiums -- but so is long-term care.
On average, nursing-home care in Minnesota costs about $55,000 a year,
with prices restricted by the state; assisted living is about $35,000 a year, but
varies widely.
State government policymakers are concerned that Medicaid financing of
long-term care will create a crisis in another few decades, when baby
boomers will swell the population of over-85 Minnesotans at a rate seven
times the overall population growth.
How plans qualify
There is no minimum coverage amount that a plan must offer to qualify for the
Partnership program.
But any policy bought by someone under age 61 must provide "meaningful"
annual compound inflation protection -- the benefit typically growing 5 percent
a year. Policies for those ages 61 to 74 must have some inflation protection.
Sullivan's and Richardson's policies could pay up to $365,000 -- $200 a day
for five years, going up 5 percent a year with inflation protection.
Their mother, Elaine Richardson, is 75 and she's still able to pay for her own
care, Sullivan said. "But Lisa and I aren't married, we don't have kids, and we
know we may need care like that someday. Getting insurance feels really
good."
First plans approved
Although action had been expected last spring, this month the state
Commerce Department approved plans offered by six insurance companies,
with seven more firms awaiting approval.
But many insurance agents aren't waiting. Marlys Fiterman in Bloomington
has been selling policies and assuring customers that they will be eligible for
the program's benefits.
"We know the law, the Partnership rules, and we got the required Partnership
training," said Fiterman, 62, a retired music teacher. She became an
insurance agent specializing in long-term care policies seven years ago after
her mother developed Alzheimer's.
The concept began as a state-federal experiment in four states in the early
1990s, and Minnesota soon sought to join in. But federal officials blocked
expansion of the program until 2006. Eventually, the program will allow
policyholders who qualify to use the Partnership benefit in any cooperating
state.
So far, the Partnership has had only a modest effect on long-term policy sales
or Medicaid expenses in other states.
"We're in this for the long term," said Colman, whose Human Services
Department is working on a public-education campaign to start in the next few
months. "How to pay for long-term care -- either the state or individuals -- is
an issue that won't go away soon."