Trusting Information on Long-Term Care Planning Can Be An Issue

According to surveys, Americans' perceptions of the media indicate that many people distrust what they see in the news. Some sources provide reliable and fair information; however, always ask the right questions about what you see. Planning for long-term health care is no exception.

It appears that many Americans question what they see, hear, and read. According to Gallup, Americans estimate 62% of the news they see in newspapers, TV, and hear on the radio is biased, 44% of it is inaccurate, and 39% is misinformation.

A recent Knight Foundation/Gallup report on Americans' perceptions of the media indicates that 76% of Republicans and 71% of Democrats say the spread of inaccurate information on the internet is problematic. 

Fake News or Lazy News?

Whether you think it is "fake news" or just "lazy news," trusting what you read and see is much more difficult. Yet, most people find financial research information and information about Long-Term Care planning on the internet.

Not everything you read is wrong. Some articles have 'levels of truth,' but the remaining part of the story is either inaccurate or just biased. 

Some Articles About Long-Term Care are Questionable

You see this often when researching long-term care. You might read articles that indicate premiums are skyrocketing or insurance companies are leaving the business. They leave out many facts which place these statements in the proper perspective.

For example, it is true that some older policies, called legacy policies, have had premium increases. These were sold before rate stability rules that exist in most states and before the interest rate crash, which significantly impacts premiums of these decades-old plans. 

Leaving Out Facts

These articles also fail to note that these increases are still less than if they purchased similar plans today. They forget to mention that many consumers can easily avoid any increase with modifications in their policies. They also don't say how today's Long-Term Care Insurance is priced appropriately based on reliable actuarial standards.

Understand the Truth

The fact is that today's Long-Term Care insurance is rate stable and affordable for most people, especially if purchased when most people do – before they retire from ages 45 to 65. Premiums are primarily based on three major factors:

• Age at application
• Health at application
• Amount of benefits purchased

Premiums did not go up because the cost of care went up, as many articles indicate. Consumers purchase the amount of daily or monthly benefit they wish to have. Most policies are a pool of money as opposed to a time period. 

Inflation Options Have Impact

Generally, people purchase some type of inflation option. Now understand, one kind of inflation option, which was popular years ago, was a benefit increase option (GPO, FBO, BIO). These options mean you have options to buy more insurance every few years without evidence of insurability. With some policies, this is automatic. Automatic options mean the benefit increases happen, along with the premium increase, unless the consumer says NO. The consumer must act to stop the increase.

With other option plans, the consumer must activate the option. Either way, this is an inflation option where the cost of insurance grows over time. 

Most policies today have inflation benefits which automatically increase the benefits but not premium. The federal Long-Term Care Partnership Program, which 45 states participate in, requires this type of inflation for consumers at most ages.

Some financial advisors or general insurance agents misuse this information to sell other products, including life insurance and annuities.

Read more about misinformation in long-term care planning.

LTC Insurance is Affordable and Rate Stable

The fact is, for many people, Long-Term Care Insurance is an affordable way to address the financial costs and burdens of aging. You certainly don't want to burden your family, nor do you want to drain savings from retirement accounts to pay for long-term care services and supports. 

Many states have rate stability rules in place; this makes the risk of future premiums increases much lower.

The cost of care is very high and always much greater than the cost of insurance. The chance that you will need some type of long-term care service and support in your life is also very high. With longevity, more of us will suffer from memory problems as well, in addition to the normal aging issues we face.

Start Research on LTC NEWS

Start researching your options by getting facts. The first step, find the current and future cost of long-term care in your area. The LTC NEWS Cost of Care Calculator is an outstanding resource. 

You can find the cost of care, the availability of tax incentives, and discover if your state is one of 45, which offer Partnership Long-Term Care policies.

There are other ways to address long-term health care. These include "hybrid" policies that mix life insurance or annuities with a rider for long-term care. Be careful here since some of these are not exactly long-term care.

Get Accurate Quotes and Professional Recommendations

Seek the help of a qualified Long-Term Care Specialist who can guide you with your education and options. Most insurance agents or financial advisors might be able to give you "quotes." You need a professional who can provide you with accurate quotes along with professional advice. 

Find a trusted Long-Term Care Insurance specialist.  

The best time to plan is before retirement. This way, you can take advantage of low premiums and good health discounts that you may qualify for. 

Long-Term Care Insurance provides tax-free benefits. You might qualify for tax deductions or credits. If you own a Health Savings Account (HSA), you can use the tax-free money in your account to pay your premium.

As you get older you will experience changes in your health, body, and mind. These changes often lead you to require help with daily activities that you take for granted today. Remember, long-term health care planning is about family. Prepare your family and finances for the consequences of changing health and longevity. Give your family peace-of-mind and start by getting facts, not fiction.