Episode Transcript:
David Chandler: Hello everyone, welcome to our next episode of LIFE Conversations. I'm David Chandler and I'm joined by...
Christina Chartrand: Christina Chartrand.
David Chandler: And we are so excited that this month, October, is Long-Term Care Planning Month. And we have a very special guest joining us today, a long-term care planning expert and the owner of Comfort Long-Term Care, Bill Comfort, is going to be sharing his knowledge with us today. Bill, as we were preparing for the episode today, just kind of talking about what direction we wanted to take the episode today. There's so many different things that we can talk about with long-term care planning. I know for myself that as I've learned about long-term care planning, talked with countless families, seniors, people that are preparing for long-term care, or really one of the things that we talked about was at the foundation of this is wanting to start with what is long-term care planning and what does that mean? Can you go ahead and just kind of, well, and also introduce yourself, please. Yeah, please introduce yourself and then let's kind of, if you can include in that, like what is long-term care planning?
Bill Comfort: Thanks David and Christina for the opportunity to be with you. My company is called Comfort Long-Term Care. I am an independent insurance broker, insurance agent, but I specialize exclusively in long-term care insurance and have been exclusively in the long-term care insurance area since the year 2000. I've been in the insurance business since 1991, and wrote my first long-term care policy back in the early 90s as well. So this is a subject that I've been pretty deeply immersed in for the past 30 years. And I've seen it both from a planning new purchase of products. And of course now many of my clients from 20 and 30 years ago are going on claim. And I've done a lot of claim consulting as well with certainly my clients' families, but other advisors that know this is an area of expertise of mine. I've done a lot of training for home care agencies, for clients and those agencies to work together more effectively to use their long-term care benefits as well. it's really, particularly around long-term care insurance and benefiting from long-term care insurance. That's my professional passion and has been for several decades. The question, what, yeah, go ahead. Yeah. And to David's question, what's long-term care planning? So it kind of goes together. And I think the big takeaway, the big understanding here is when we say long-term care,
Christina Chartrand: So Bill, what is long-term care insurance?
Bill Comfort: What we mean by that is a need for help, whether it's in your own home or some sort of residential care setting, it doesn't matter. If you need help safely getting through the day, and that's normally measured either by needing physical help with a couple of things called activities of daily living, things like bathing, dressing, transferring. And being able to do those physical activities safely, or in a similar fashion, needing supervision, needing someone around because you have a cognitive, a mental limitation.
I mean, you know, we think of things like Alzheimer's or dementia as we age, but it could be a head injury, you know, or a stroke that affects thinking and cognition. So if you need somebody around during the day to make sure you're safe, that's what we mean by long-term care. And the importance of long-term care planning and where long-term care insurance fits in that is paying for professional care that helps you be safe getting through the day, either physically or because of a cognitive limitation. That is not covered by anything other than your own money or if you're out of money, state Medicaid benefits. I like to say Medicare health insurance after age 65, Medicare only pays for short-term care. And that's only when it's skilled and rehabilitative a month or two. It doesn't pay for months and months or years and years of help.
So the importance of long-term care planning is making sure that if you need this kind of help, that you have the finances, the money to pay for the kind of help that you would like in the location where you would like. Again, starting at home, using adult day services, maybe having to transition to assisted living or memory care perhaps.
And it's interesting, most people hear the phrase long-term care, David, and they immediately think and picture in their minds a very institutional, what we might call kind of an old-fashioned idea of a nursing home. But you know, that's the last place anyone wants to plan to go. And it's actually not where most care takes place. Most care is in the home. So that's sort of the general subject in Christina long-term care insurance is the insurance product that fills this gap for care that's not really covered by anything else until you're practically destitute.
Christina Chartrand: Okay. Hmm. Hmm. So I'm just curious. What do you think the percentage of people owning a policy is?
Bill Comfort: Yeah, it sort of depends whose statistics you look at, whose data you look at, and kind of where the cutoff is, is it all Americans, or is it Americans over the age of 40 or 50, which is kind of the age when more and more people are likely to buy the insurance. I think the right number is really Americans over age 40 or 50, only about 9 or 10 % of Americans own some type of this coverage. And I just, was at a conference recently and an economist who studies geriatric issues, even on national economies, he estimated that 30 to 40 % of all Americans could afford some meaningful amount of coverage and even still qualify for it because you have to be able to be young enough to afford it and healthy enough to qualify for it. So, you know, nine or 10 % of people, we probably only have, you know, a third or a quarter of the people covered that we should. And we see it all the time with people who struggle. Yeah, go ahead, David.
Christina Chartrand: Really?
David Chandler: Yeah, I was gonna ask, I was gonna ask Bill like how many people end up, we've got nine or 10 % of the population covered, how many people end up would benefit? Sounds like maybe four times that, like around 40 % of people would eventually benefit or activate a long-term care plan at some point.
Bill Comfort: Well, yeah, so let me kind of, let's look at that from a little different angle. I think, you know, when I say, you know, maybe 30 or 40 % of Americans could benefit. other words, they could and should buy it in some amount. And there's a lot of statistics about how many people will need care. If we use the federal tax code definition of chronically ill, which is what triggers benefits in long-term care insurance, which is again, either, and this is interesting as well, at least standby help with at least two out of six measurable physical activities. So by the way, you don't need somebody to physically pick you up out of the chair to qualify. You simply maybe because of frailty or balance or fall risk, somebody ought to be standing by just in case, much lower threshold. So if we look at people who either need that level of help or separately supervision because of a cognitive impairment where they're not safe being left alone, there was a study that was just updated two years ago by the Department of Health and Human Services and the Urban Institute that's been tracking this for a while. And they looked at that definition, right? And that's not just needing help with groceries and transportation and housekeeping, right? It's personal care, personal help. And what they said is 56 % of people over the age of 65 will need this level of care during those later years of life.
David Chandler: Yeah, especially as people are getting, they're living longer. We're definitely seeing that those opportunities increase exponentially.
Bill Comfort: So it's a great question. And there's a little phrase I heard recently that I like, and think about this broadly in terms of financial planning and savings and retirement planning and long-term care planning, that longevity is a risk multiplier. In other words, the longer you live, the greater the risks are, let's just start with retirement planning, the greater the risk is that you're run out of money, because you live a long time. But if you think about it, if you live to 85, 90, if not longer, isn't it reasonable that you could need care for a few years along the way? It's the same kind of longevity concern that compounds the risk that we face.
David Chandler: So Bill, many of our listeners are caregivers. Maybe they have a mom or a dad that would be at that stage where they'd be looking at activating a long-term care insurance policy. So a few questions that if I'm in that situation, one, how do I know if mom or dad has a long-term policy? If they do, what are the benefits that come along with that? it helps provide with care, but what are the ranges of care that they may be looking at with that support? And then there are probably some other questions that I'm not asking around somebody who's a caregiver. know you have such a wealth of knowledge. What other questions should I be asking for those family caregivers?
Bill Comfort: Yeah, the question to mom and dad have this coverage. mean, you got to start by asking them. I mean, if you're an adult, adult child, adult caregiver, or you're just trying to help your parents maybe navigate, you have to have the conversation. And hopefully they know. You might have to dig through some file cabinets and papers and things. And if you can't find a policy, look through, and some people pay their premium only once a year.
So there might only be a billing notice or receipt once a year, but if you could find a policy receipt, you know, where parents paid the premium 10 months ago, but you can't find a policy, well, then you could call the insurance company. And typically you'd want the parent on the phone with you, at least to just say, yes, this is David, he's my son, please give him the information you need. Because we have all the HIPAA privacy rules and everything. But being a bit of a detective is important. And even if you find information, you have to have a copy of the complete full policy. Just a summary or just the initial quote maybe from the agent 20 years ago.
That doesn't give you enough information to really know how the policy is gonna work at claim time. So if you can't find a full policy, the carriers are, they have to send or provide a new copy of it. It can sometimes take several weeks to get a copy of a policy. So starting sooner to get this stuff in hand makes sense.
Christina Chartrand: Okay. That's a really good point because thinking about starting earlier in your planning process really so that you have understand all of the potential benefits of your loved one, like all the things so that when this happens, I feel like, Bill, and you can tell me if I'm wrong on this, but I feel like when people are getting to the point of activating a policy, it's usually very fast. They're like,
I need help now. It's like they're being discharged out of rehab and like, I need it now. It's like this, they're in panic mode because now they're needing to pay out of pocket or they're realizing that their loved one can't be alone. And that's a very stressful time just in general for someone. Any tips around that?
Bill Comfort: Yeah. So let me start with some very general advice. File a claim, start the claims process as soon as possible. Even if you or your family member doesn't think they maybe want to use the policy benefits right away, because some people, you know, maybe they only have a three or four year maximum benefit period. And some people are like, well, we're only getting a little bit of maybe part-time home care right now, and we can afford that, but gosh, care costs could get much higher in the future. So even if that's the mindset, and I don't think that's the proper mindset, by the way, use the insurance company money first. Because by the way, if you have a three year policy and you wait and you're only unclaimed for a year and a half, they don't give you the unused benefits.
You're better off saving your own money and using it first. But, but, back to this idea of starting it, even, even if it makes sense, maybe you don't want to use the policy right away. Starting a claim as soon as possible does a couple of things. Most importantly is it establishes that you're eligible. Now it establishes that the care providers, the home care agencies or agency that you're choosing or the residential care community that they're even covered by the policy. That's a back and forth with the insurance company. And most policies have a 30 to 90 day deductible period. It's called the elimination period, sort of an unfortunate term, but you know, file a claim and get credit for those 90 days where you got to pay out of pocket anyway. You don't have to keep filing a claim after that, but get it established, get it started. know, get the deductible out of the way. By the way, a lot of people don't realize this. Once you start a claim with most policies, most policies, you stop paying premiums. So there's an advantage, you know, again, to starting sooner rather than later.
Christina Chartrand: Okay. Get it started.
Bill Comfort: Find the original policy. I think you also asked, you know, what's covered, what's in there. It's very policy specific. And it kind of depends when the policy was issued. Since about 1997, most policies are comprehensive. So they cover home care and all of the facility options. If it's before 1997-98, you need to look closely. It might not cover home care, because that used to be an option.
CLOSING MESSAGE: Thank you for joining us for part one of our two-part conversation with Bill Comfort about everything you and your loved ones need to know about long-term care insurance as a key part of your long-term care planning strategy. Be on the lookout for the next part in the series. And if you haven't already, please take the time to give Life Conversations a five-start review on your listening platform if you found this episode or any episode useful or engaging. Your support means the world to us.
Bill Comfort’s expertise in long-term care insurance offers valuable insights for anyone looking to plan for the future. As the need for long-term care continues to grow, understanding your options and planning ahead is more important than ever. Be sure to tune in for Part 2, where Bill will provide even more advice on long-term care strategies and how to navigate the claims process for optimal benefits. Stay informed with LIFE Conversations with Senior Helpers!
