In this episode of Senior Living Live, Ben Green, COO of Insurance Advantage, walks us through long-term care insurance—who it's for, how it works, and how it can help you afford senior living.
Video Transcript
- Hello everyone. And welcome into Senior Living Live. My name is Melissa. I hope you are having a fantastic day today. In our ongoing commitment to help you navigate Senior Living seamlessly or as seamlessly as possible, I'd like to introduce you today to a very special man. His name is Ben Green. He is the COO of Insurance Advantage. Ben, nice to see you today. How are you?
- Melissa, how are you doing? Great to see you.
- Yeah, I am doing great. And we are so fortunate to have you share your knowledge with us on a number of topics really. We will see quite a few videos with you as the lead character, because you are an expert on many topics as it relates to Senior Living. And today we're gonna take a deep dive into long-term care insurance. But before we do that, Ben, tell us a little bit about yourself.
- Yep. So born and raised in Columbia, South Carolina and went to Morehouse for my BA in finance, went to University of South Carolina for my MBA and started up the company about 11 years ago. And we sort of migrated from the Affordable Care Act plans, where are a lot of our clients were actually turning 65, so they needed help with Medicare and then started needing help with social security planning, you know, annuities in life insurance and long-term care which we're here to talk about today. And we're really happy to be able to serve folks really across the country, obviously help a lot of folks in the Southeast but we are now sort of spreading across the country. Helping folks in, our help is free. And I'm really proud to be a regional director for the Financial Education Partnership which is a nonprofit that provides financial literacy across the country. And so I really wanna just thank you for having me on. It's a great pleasure and an honor to be on with you.
- Yeah. It's an honor to have you here with us. I mean, you've already shared your knowledge with us about Medicare. So we've got that video and you can head over to www.seniorlivinglive.com to catch that video. And you will have more topics, as you mentioned life insurance, social security benefits, retirement. And then as you said today we will discuss long-term care insurance. So, what exactly is that, Ben and who is it designed for?
- Yeah, so long-term career, Melissa it's insurance that helps to cover the cost of skilled nursing facility care, home health care or nursing home care, which has been obviously a really hot topic in the news especially in the last year with COVID and it's insurance is designed to cover those costs that are not covered by health insurance, Medicare, or by Medicaid. And we can talk a little bit about who qualifies for Medicaid, the answer is, a lot of folks do not qualify for Medicaid, so we can talk about that as well.
- Yeah, well, I didn't realize that. And again, I mean, so the viewers range from all ages here but people who are clicking on those are probably those who are just dipping their toe in and just trying to figure out ways to pay for care or to pay for Senior Living. So, what is the best way that someone can calculate the amount of coverage that they think they might need? Because long-term care insurance is all about forward thinking and does health history play a role in terms of costs?
- Yep. So, there are a few free websites out there. There's one with Genworth, if you kind of Google Genworth, in the cost of care, for example they have different resources on how much it costs but typically speaking, typically speaking you're looking at about $4,000 per month for a home health care aid, for example, maybe about 6,000 to 7,000 per month for a skilled nursing facility. And if you're going into a full blown nursing home, and especially if you have to go into memory care, for example you have some dementia issues or Alzheimer's issues, that cost of care can be anywhere from $7,000 a month up to about $12,000 per month. So, it really, really depends on a number of factors. Sometimes it depends on luck. Sometimes it depends on your family sort of history and health history. Sometimes it depends on gender. Overall, there's a 70% chance that you are going to need some sort of long-term care especially if you live to be 65 years old. If you hit 65 years old, your chances of going into long-term care are extremely high. Your chances of living to be at least 85 years old male or female are really high. And one out of four of us, if we hit 65 we wanna probably hit 90 years old, at least. And so those chances are all high. More women versus men go into long-term care based on just kind of the law of averages. And, you know, you can stay in there typically for about a 24 to 36 months or two to three years. So, if you're trying to plan and you're you're looking at two or three years in longterm care facility, and the average cost is seven or $8,000 per year, you can do the math, it's a lot of money, two or $300,000 you can potentially plan for in costs. And we always say that long-term care insurance is not gonna be the full solution typically but it may be 40 or 50% of what you sort of plan for in terms of those costs.
- Sure. And those are some great statistics that you gave. I mean, we are really living a lot longer these days without question, but again, all of this is about forward-thinking and what you think you might need. So I can't imagine somebody coming to you at the age of 20 thinking of long-term care insurance. So, what are the age ranges that you're kind of looking at here for people who are coming in looking for this and does it get harder as you age to lock down this kind of insurance?
- Yeah. Yeah. So, great questions, Melissa. So, we actually do have some 20 year olds and 26 year olds that have come to us looking for a long-term care coverage because they've seen it happen, not with their parents necessarily, but with their grandparents. And so, we're really, we're serving folks anywhere from age 25 up to about age 75 is typically the cap in terms of us being able to find some semi affordable long-term care insurance for you and depending on what your age is, you know if you're a 26 year old, 27 year old person up to 60 years old, 65, and you don't have a lot of health issues we typically can find like a hybrid type of solution that includes life insurance plus a long-term care sort of a use it or lose it sort of a non-use it or lose it solution where if you don't use a long-term care coverage your family's gonna get some life insurance. For other folks that are younger, sometimes it's a little bit cheaper to be able to use that type of a hybrid solution. And we also have some standalone solutions for folks that may be a little bit older, where they can at least get some of their money back in that but not participate in all the growth of the money if they don't use up the long-term care coverage. So there are a lot of different options that are available really all depends on your age, your budget and your health.
- Yeah. And now that you say that, I'm gonna have to make a separate phone call to you because I am way behind the eight ball at this point. If you have 20, 30 year olds that are coming in looking for this but as you said, and there's some experience that goes along with that, and there's a reason why they're coming to you because as you said, they've seen it. And for someone maybe like myself, I haven't really seen it with family members or haven't gone through that yet but it is absolutely something that we should all be thinking about as we get older, starting in our 20s. It's a great thing to have just to say that you have it and if you ever need it, it's there. So speaking of that, and you kind of touched on this with a hybrid insurance but when it comes to long-term care insurance, Ben, is it a use it or lose it situation?
- So, that's a great question. I'd like to share a quick slide with you here. So, there are basically three types of long-term care insurance. So they're standalone care, which is, standalone insurance which is what everyone was sort of used to at least about 20 years ago, you know, 10, 15, 20 years ago where you could buy a policy and if you use the policy for long-term care insurance, great if you did not use that care insurance policy, it kind of went out the window. So it was use it or lose it. You either use it or you lose all the money. What's become a lot more popular now are hybrid policies where you can get life insurance. That includes a long-term care insurance writer and the writer kicks in, that insurance kicks in if you cannot perform six of the activities of daily living and they include things like bathing, cooking, transferring or even walking an incontinence issue, for example. And so, those policies are really, really good. And they're really, they become really popular because you can utilize them for life insurance and even for chronic conditions like cancer, for example, as well. So, really good policies that are available. And there are dozens of carriers, insurance carriers now that provide those types of hybrid policies. The standalone ones, they're only a few left really in the entire marketplace. And then the other type of long-term care insurance that people really need to watch out for is reimbursement policies, which are okay versus indemnity policies. If you can, we prefer the indemnity type policies where you get paid the money. So for example, if you sign up for a plan and it's gonna give you $6,000 per month, you get that money, you receive that that $6,000 per month versus having to send in receipts for your skilled nursing facility or for your nursing home that may only be, for example, $4,200 or $5,000. If you have an indemnity type of a long-term care plan you get that full 6,000 or $10,000 per month and you can utilize that money really in any way you see fit.
- Excellent information, very, very good information there. So, if somebody is in their say their 40s and they took out one of these insurance policies maybe it's the standalone, as they age or get older, can someone add benefits to a current long-term care insurance policy?
- That's a great question, and the answer is no, unfortunately, because you at 40 or you at 50 you're different in terms of your health typically speaking than you're gonna be at 60 or 65. And so just like the life insurance you typically are gonna have to do all the medical underwriting again they want to take a look at your medical records, what prescriptions you're taking, even your driving record actually and kind of rewrite that policy for you for long-term care.
- Gotcha. And as we look at these three types of different long-term care insurance policies what are we looking at in terms of cost, and again everybody's gonna be different, but ballpark window may be large here, but what is somebody looking at?
- Yeah, so it depends on whether you're gonna do sort of monthly costs. You know, it can range from, you know, for the 26 year old, her life insurance plan plus long-term care is about $150 per month. And she's gonna have total about $250,000 in life insurance that she has and bucket of money from that to pull for long-term care. For someone we're looking at a 57 year old this past weekend, he's looking to put in a single premium. So he's gonna put in for example, $60,000 or $40,000 for example, to kind of buy an instant bucket of long-term care money, if you will, that he will have access to, and it can grow over time because very likely he may not hit the claim until he is 80 years old or 85 years old, or even 95 years old like my granddad was. So, really kind of all depends on what your age is and what your, if you're gonna do a monthly versus sort of a single premium. And it also depends on what your health is because the healthier you are the cheaper these policies are gonna be.
- Sure. And that's, you know, I think any insurance that is dealing with life insurance or long-term care insurance, but you did bring up some options there that certainly give people food for thought that big lump sum or the monthly payments. So, there are definitely some options for you watching out there. So, if someone is interested in purchasing long-term care insurance what is the first step that they need to take?
- Yeah. So the first step is to reach out to, typically reach out to a professional that does this on a daily basis and try to reach out to someone that is independent or as independent as possible which means that they're not beholden to one insurance company over another. They can go out and shop the entire market for you and come back with the best plan for you even based on your state, for example.
- Yeah. And how big is that? Because, you see a lot of insurance companies that are there, they're a corporate entity, right? And so when you go with an independent broker can you kind of break down the differences there? I like what you're saying, that you're not tied down to anybody but what exactly does that mean for the buyer?
- Yeah, so what that means very simply is that we, I work for the client and not for the insurance company. We do a lot of work for really large insurance companies where some, you know, one of the the top writers of health insurance, Medicare for example, in the Southeast actually based on volume but we do not work for any particular insurance company. And so with that in mind I can act as your fiduciary essentially, versus acting as someone who just wants to sell you something.
- That's fantastic. And I think news to a lot of people's ears and music to a lot of people's ears as well for our viewers watching. Now, Ben of course, final question here. If somebody wants to get in contact with you or your office, how can they do that?
- Well, first of all, I really appreciate being on and I appreciate you are asking these great questions. Anyone has questions from us they can call my personal cell phone here at 803-519-3394. Or they can send me an email. Feel free at any time to ask questions. We love being able to provide this information and it's really important. So that's why I really wanna thank you all for asking and for providing this type of a platform for folks.
- Oh, absolutely. And we're gonna be seeing a lot of you, our viewers will see a lot of you because as we mentioned you already got the video on Medicare. We've got this video here on long-term care insurance and we've got quite a few more videos coming down the pipeline that will talk about social security benefits that will talk about retirement and bridging the gap, there's a lot of people out there who need to bridge that gap from when their benefits start to what is the age? 68. Help me out here, Ben.
- Yeah. So from 62 when you're eligible typically to take social security to age 65 when you you're typically gonna qualify for Medicare, there's a big gap there. And the Affordable Care Act has provided a solution. So really, really excited to dig into that. It's sort of a niche topic that we get excited about.
- Yeah. And this is where we leave you all hanging for more. So we have film at 11. We'll have that video coming down the pipeline with Ben. You definitely don't wanna miss it. Ben, thank you so much for taking the time to join us today.
- Melissa, thank you.
- Thank you. And for more information on Senior Living, you can head on over to www.seniorlivinglive.com. You can check out our entire video vault 24/7. As always, thank you so much for watching Senior Living Live. Have a great day, everybody.
