Saving Money on Health Care for Baby Boomers

Saving Money on Health Care for Baby Boomers

Couples in their 60s and 70s are reducing their long-term care insurance rates by combining their wealth. Long-term care insurance might be cheaper if you purchase it as a pair, according to experts and advisors.

For individuals who are prepared to do some research, three options are worth considering:

Sharing of care plans

Sharing long-term insurance does not obviate the necessity for both spouses to purchase their own plans in the long run. Each policy has a specific rider that allows one spouse to tap into the benefits of the other.

Shared insurance is a great option for those times when you need additional coverage than your current plan provides. However, what happens if both parties end up spending more than they had originally planned to?

With a contract that has long-term terms and plenty of flexibility, experts suggest you won't have an issue. For those who are interested in a lifelong insurance policy, they point out that certain providers do. The higher the premium, the longer the contract. The cost of a lifetime insurance policy might be higher than that of short-term policies that cover just three to five years of long-term care.

The entire objective of obtaining a policy that permits you to share advantages might be undermined by this, says Neil Gholson, President of LTC Finical Solutions, Inc.

As a precaution, Neil recommends that you get at least four years of insurance coverage. In long-term insurance, the Consumers Union senior policy researcher notes, nursing-home utilization averages approximately 2.5 years.

According to Gholson, "Very few individuals stay longer than five years in a nursing facility." When it comes to long-term care, four years is a good length of time to look at. " Since plans may cover both home and nursing facility care, "a few years might be a bit short."

Couples who want to purchase short-term plans but still want some freedom to use their spouse's benefits may be most suited to shared care insurance, he said.

Deals for long-term health care services

Since then, a program that had been operating in only a few states has been extended to the whole nation. Long-term-care insurance plans may be considered against Medicaid's criteria for relying on personal assets to pay for health care.

However, the circumstances in every state are unique. When it comes to long-term care in New York, for example, customers must acquire a policy that covers at least three years in a rehabilitation facility and six years of in-home care. Gholson claims that in exchange, the state promises not to pursue any personal assets if a person exhausts the benefits of their private coverage.

It's a free benefit with no strings attached, he said.

Dollar-for-dollar protection is used by states like California and Connecticut. In such circumstances, the amount of assets shielded from Medicaid pay-down restrictions is calculated using the value of a private insurance policy.

States save money by pushing long-term care expenditures to insurance firms. The whole Medicaid system will be less taxed as a result, too.

Individuals may be able to reduce the amount of insurance they need to purchase by forming such partnerships. You'll still end up paying out of pocket for the cost of lower coverage than what is required to be eligible for Medicaid.

Buying enough insurance to cover your whole portfolio in a partnership program can be a good idea if you reside in a state that pays one dollar for one dollar.

Inquire with your insurance provider about discounts for purchasing multiple products at once

Saving money in this manner may turn out to be the most straightforward method yet devised.

Certain carriers now offer discounted pricing when two individuals purchase a long-term care package at the same time.

Spousal discounts might save you anywhere from 15% to 25% off your normal rates. In addition, if you qualify as a very active and healthy applicant, certain carriers will give you an additional 10% off.

Consider the following:

There are drawbacks to all three possibilities. Cheryl Matheis, a health strategist at AARP, says that "people need to realize that the shared-care marketplace is a pretty new concept." It is imperative that they ask a lot of questions and thoroughly review each regulation.

1. Look at the insurers' history of adjusting their pricing and policies. Only a few insurance companies haven't raised rates.
2. Traditional long-term care plans of comparable length are likely to be slightly more expensive than shared long-term care benefits.
3. Without a joint long-term care policy, two individuals may have to get more comprehensive individual plans to provide the same level of protection. As a result, insurance plans might be reduced in length via shared care.
4. The ideal solution is usually to get separate long-term plans if you have adequate money.
5. If you're looking for a more cost-effective solution, you should at least investigate shared care.
6. Gholson advises considering any possible loopholes in state cooperation schemes. You can't even be sure that getting enough private health insurance to match your assets would work.

According to Gholson, Medicaid eligibility and income limits vary widely throughout the country, so the government may still be entitled to take your assets in certain circumstances.

With the correct amount of study, spouses who decrease their health care expenses may reap big rewards. Talk to a long-term care insurance agent that represents many insurance companies to find out what alternatives you have.