When it comes to long-term care insurance, most Americans are going to be priced out of the market.
A little update on the earlier post about the horrible financial burden dementia places on families, and how few can afford care without ending up bankrupt…
I noted that years ago we took out a long-term care insurance policy. Over time the premiums have grown, but over time our income did as well so by making that policy a priority, we could afford it. Only about 20 percent of Americans can.
Since Connie went into memory care and we began receiving benefits (75 percent of her monthly fees) the premium has been waived. At such time as she no longer is drawing benefits, I will be required to start paying premiums again.
In the interest of transparency, I will share our numbers with you.
Our last annual premium as around $6,800 a year.
I recently got a letter from our insurance company advising there will be a rate increase….of 68 percent. That is not a typo. It will be 68 percent. They will be phasing it in over three years.
That means this year our premium, were we not on a waiver, would go from $6,800 a year to $7,369. The next year it would go $7,369 to $9,211, then from $9,211 to $11,514 and the finally, to $12, 378.
To put it in perspective, if I start paying that final amount in a few years it will be the equivalent of six months of my rent.
Premiums for those buying new policies most likely would be higher than rates charged existing customers.
For anyone who does not think we have an eldercare crisis in this country, this should be stark evidence that we do. Congress could, and should, do something about this but don’t hold your breath.
It is simply stunning.
Rich Heiland, has been a reporter, editor, publisher/general manager at daily papers in Texas, Pennsylvania, Illinois, Ohio and New Hampshire. He was part of a Pulitzer Prize-winning team at the Xenia Daily (OH) Daily Gazette, a National Newspaper Association Columnist of the Year. Since 1995 he has operated an international consulting, public speaking and training business specializing in customer service, general management, leadership and staff development with major corporations, organizations, and government. Semi-retired, he and his wife live in West Chester, PA. He can be reached at [email protected].