LONG TERM CARE INSURANCE
WHAT DOES IT HAVE TO DO WITH
REAL ESTATE?
SKIP FRENZEL GRI, CRS, SRES, GHS
AGAPE REAL ESTATE
SKIP FRENZEL CFP, CSA, CLTC, CMFC
AGAPE LONG TERM CARE
HAVE YOU THOUGHT ABOUT….
• WHAT PLANNING HAVE DONE
FOR YOUR CARE?
• WHO WILL PAY FOR IT?
• WHO WILL TAKE CARE OF YOU?
• DO YOU HAVE A PLAN?
LONG TERM
CARE AND LONG
TERM CARE
INSURANCE
LTC ≠ LTCI
LONG TERM CARE
• LTC is a continuum of care,
housing, finance, and services
that people will need most likely
when they live a long life
• It involves the person’s ability to
function
Functioning is made up by:
-one's cognition
-mobility
-impairments
-chronic conditions
-AIDS
-AUTO ACCIDENTS
-FARM ACCIDENTS
-SPORTING ACCIDENTS
-MS
-ALS-LOU GEHREG’S DISEASE
-STROKE
-ARTHRITIS
-PARKINSON’S
-RETURNING INJURED WAR VETERANS
46% of people receiving LTC
services are under 65
Think of…
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Christopher Reeves
Ronald Regan
Michael J. Fox
Annette Funicello
Terri Garr
Montel Williams
Steven Hawking
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Mister T
Muhammad Ali
Richard Pryor
Charlton Heston
Dr. Spock
Glen Campbell
LTC involves care, not a cure.
Medical insurance-for people that
are sick or injured
LTCI-for people that can't function
You cannot detect
them,
there
is
no
Frailty and Falling
medication,
are not medical
therapy,
or
conditions
procedure to
“cure” them
ACTIVITIES OF DAILY
LIVING
(ADL’S)
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BATHING
• TRANSFERING
DRESSING
• AMBULATING
TOILETING
• EATING
CONTINENCE
Instrumental Activities of Daily
Living (IADL)-activities that relate to
house management and independent
living
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Managing money
Using the telephone
Meal preparation
Medication management
Doing heavy housework
Shopping for personal items
Doing light housework
THE NEED FOR LTC IS
• ACUTE-MEDICAL, SUDDEN, PATIENT
CREATED BY IMPAIRMENTS:
EXPECTED TO FULLY RECOVER
• PHYSICAL-TREATABLE, BUT
GENERALLY NOT CURABLE
• COGNATIVE-LOSS OF MEMORY,
ORIENTATION, & REASONING
CAPACITY (COGNATIVE
IMPAIRMENT)
• Acute
7%
• Physical & Cognitive
93%
SERVICES
• MEDICAL-ACUTE
• PERSONAL-ADLS
• ENVIRONMENTAL-IADLS
The question isn’t who will provide
this care, but what that will do to his
family
• may make caregiver sick
• tends to tear families apart because
the responsibility is not shared equally
Children don’t want to take care of
parents, but will because it’s the
right thing to do & they worry about
their safety.
Then there is the 60 year old child,
49% of 60 year olds have at least 1
parent still alive
IT’S ALL ABOUT LOVE!
TYPES OF SENIOR CARE
FORMAL
HOME
COMMUNITY
FORMAL HOME
FORMAL COMMUNITY
INFORMAL
INFORMAL
HOME
INFORMAL COMMUNITY
TYPES OF CARE
• Custodial
• Non-medical
• Volunteer
• Not skilled
• Not paid or
paid
• Chronic
• Medical
• Trained
• Skilled Care
• Paid
• Acute
LONG TERM CARE
INSURANCE
• House Fire-major
1 : 1,200
• Auto Accident, car totaled
1 : 240
• LTC 2.5 yr in NH
1:3
LAN-Lite Ass’n. News
Most important types of personal
insurance coverage in order:
• Health
• Disability income
• Life
• LTCI
-National average for private NH room
$253/day $92,378/yr
-Semi-pvt $225/day $82,125/yr
-ALF $43,539/yr
-Home health care $20/hr
-Homemaker/companion $19/hr
-Adult Day Care $68/day
Genworth Cost of Care Survey 2016
-Residential care facilities $100-$160+/day
-Live-in companion or homemaker $275+/day
Higher with medical training.
-RN visit to home $150+
-Medical social worker home visit $140+
https://www.genworth.com/about
-us/industry-expertise/cost-ofcare.html
Who pays for LTC?
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CA, Medi-Cal 47%
Medicare 18%
Private LTCI 9%
Patients & family members 26%
U.S. Dept of Health & Human Services
5/25/07
Note that Medicare and private
insurance will not cover LTC. And
you must be impoverished to get
Medicaid. This is probably the
biggest LTCI misconception.
5 CONDITIONS CAUSING
ADLS OR IADLS BY AGE:
AGE 18-64
• BAD BACK
• MENTAL RETARDATION
• MENTAL ILLNESS
• CORONARY HEART
DISEASE
• RESPIRATORY
CONDITION
AGE 65+
• ARTHRITIS
• CORONARY HEART
DISEASE
• VISUAL IMPAIRMENT
• STROKE
• RESPIRATORY
CONDITION
LONG TERM CARE INSURANCE CAN
COVER:
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HOME CARE
ASSISTED LIVING
ADULT CAY CARE
RESPITE CARE
HOSPICE CARE
NURSING HOMES
ALZHEIMER’S
FACILITIES
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CAREGIVERS
HOME CARE
PRIVATE DUTY NURSE
COMPANION
HOUSEKEEPER
THERAPIST
LIVE-IN HELP
Money just pays for LTCI,
health buys it.
Underwriting is getting
more strict 1:5 people
will not qualify.
UNINSURABLE CONDITIONS
• recovery is rare or a cure in not
available at this time
• the symptoms are severe and
tend to be progressive
Putting off buying LTCI
• for every year wait, premiums 14-22% higher
• percentage of people able to pass
underwriting much less @ 70 than 60
• 1:3 75-80 won’t qualify for coverage
because of health
• could qualify for preferred rate, based on
health, may need to go on claim earlier
• 55 yo married male, $100/day $709, at 65
$1,342
Sex, air, toilet paper and insurance are the
same. You don’t appreciate them until you
can’t get any.
Long-term care insurance rates are
determined by eight main factors:
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The person's age
Daily (or monthly) benefit
How long the benefits pay
Elimination period
Inflation protection
Health rating (preferred, standard, sub-standard)
Gender
Options
Plan of Care-A written
individualized plan of services
approved by a health care
practitioner which specifies the
type, freq, & providers of all formal
& informal LTC services required
for the individual, & cost, if any, of
formal LTC services prescribed.
ALTERNATIVES TO LTCI
• Life insurance with accelerated death benefits
or riders
• Annuities-immediate, deferred
• Home equity conversions/Reverse Mortgages
• Continuing Care Retirement Centers (CCRCs)
• VA
• Self Insuring/Personal assets
• Savings
• Partially insure, or bare bones LTCI policy (LTCI
Lite)
• Short, fat coverage-lower duration & raise daily
benefit, use money to cover later
ALTERNATIVES TO LTCI (CONTINUED)
• Hybrid policies part life insurance & part LTCI
• Viatical settlements-co buys existing life policy for
percentage of death benefit
• Kids pay for parents LTCI
• Associations-15% discount to clubs, buss,
families, church, assoc, etc
• Through business:
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72 t or q distribution
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C-Corp has retained earnings
Other Ways to pay for LTCI:
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Reverse mortgage
Health Savings Accounts
Medical Savings Account
Health Reimbursement Accounts
Cafeteria plans
Flexible Savings Accounts
Annuities
Trusts (CRT & Medical Disability Trust)
PARTNERSHIP POLICIES
Select insurance carriers meet certain
criteria with their policies and if people have
them, they have certain consumer asset
protection features that protects them from
Medicaid recovery.
Prevents or delays their dependence on
Medicaid
UNCERTAIN TIMES
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Low interest rates
Many companies exiting LTCI market
Many companies raising premiums
Many companies reducing benefits
Many companies making it harder to go on
claim and refusing to let policyholders go on
claim
We must think differently about
what living a long life means
THE END
John “Skip” Frenzel
629 Lisa Way
Campbell, CA 95008
408-984-6661
408-422-SKIP (7547) cell
408-984-2078 fax
John D. Frenzel "Skip"
CFP®, CSA®, CLTC, CMFC
Long Term Care Specialist
Agape Long Term Care
CA License #0B33867
info@AgapeLTC.com
www.AgapeLTC.com
John D. Frenzel-REALTOR®
GRI, CRS, SRES®, GHS™
Agape Real Estate
CA License #590513
RE@AgapeLTC.com
www.AgapeRealEstate
Genworth Annual Cost of Care
Survey
https://www.genworth.com/about
-us/industry-expertise/cost-ofcare.html