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By Bob Carlson

Senior Contributor, Forbes Magazine

 Aug 30, 2021

The Covid-19 pandemic likely had a significant impact on long-term care insurance (LTCI), though most of the effects won’t be known for a while yet.

The pandemic appeared to increase interest in and purchases of LTCI. It’s too early for the data to be available, but anecdotal reports from insurers and agents indicates that the pandemic increased inquiries about and purchases of different types of LTCI.

The widespread effects of the pandemic made more people aware of the potential they might need LTC at some point. The pandemic also made more people realize that the need for LTC can arise suddenly and much earlier in life than they realized.

The increased interest in LTCI is consistent with reports that people became more concerned about estate planning during the pandemic.

The pandemic also taught insurers and agents to stress that LTCI is not “nursing home insurance.” A widespread misunderstanding about LTC in general and LTCI has been the assumption that the care primarily is delivered in a nursing home or an assisted living residence. In fact, the majority of LTCI claims paid by insurers now are for home care.

After reports that one-third of Covid-19 deaths were of nursing home residents and that long-term care facility residents were subject to forced isolation during the pandemic, many people emphasize that they want to receive any care they need in their homes for as long as possible. They want to create a financial structure that will help pay for LTC at home. Though LTCI has paid for home care for many years, many potential purchasers didn’t realize that until recently.

Most LTCI policies pay for LTC delivered in almost any location. The standard provision triggers benefits when the insured is diagnosed as having a cognitive impairment or needing assistance with at least two of the six activities of daily living. It doesn’t matter where the care is received. The ability to pay for care received at home makes LTCI attractive to more people.

A negative effect of the pandemic on LTCI is that it is more difficult to qualify for LTCI. Insurers reportedly are declining more applications for several reasons.

In-person medical exams are required for more applicants. Previously, in-person medical exams for LTCI applicants weren’t common. The underwriting process typically involved a review of a questionnaire and some medical records. A telephone interview also was common. Now, it’s more likely that an in-person medical exam will be required when the paperwork or telephone interview raise any questions.

More insurers are lowering the age limit at which they’ll issue policies. Also, the list of pre-existing conditions that will disqualify an applicant is lengthening at many insurers.

Insurers are more likely to be concerned about applicants who reside in areas of the country with high rates of Covid-19 infections or who have traveled to certain countries in the recent past. These applicants could be denied coverage, or the effective date of the coverage could be postponed until after a waiting period that makes the insurer comfortable.

Those interested in LTCI continue to move away from traditional LTCI and toward the hybrid policies. The hybrids are annuities or life insurance contracts with LTC benefits.

Traditional LTCI sales declined sharply after the financial crisis. Many issuers of LTCI policies left the market, and other insurers raised premiums substantially on existing policyholders. New policies have carried higher premiums and less coverage than policies issued before the financial crisis.

The hybrid policies guarantee no increase in premiums. Many are paid with one lump sum premium deposit. The hybrid policies also make it easier for the insured to recover most or all of the premium deposited with the insurer if the insured needs the money before needing LTC.

One of the more attractive features of the hybrid policies is they don’t have the use-it-or-lose-it characteristic of traditional LTCI. When the purchaser of traditional LTCI passes away after making few or no claims against the policy, the heirs of the policyholder receive nothing from the policy. The only benefit the insured received from the premiums paid was the comfort of knowing the coverage was there if needed.

The hybrid policies, on the other hand, provide something for beneficiaries when the insured didn’t exhaust the LTC coverage. The amount available to the beneficiaries will depend on the policy purchased but usually is at least full recovery of the premium deposit if no claims were made against the policy. The insured is guaranteed that the beneficiaries will receive some benefit from the policy if the insured doesn’t claim substantial LTC benefits.

These factors are why sales of hybrid LTCI increased substantially in recent years while sales of traditional LTCI continue to dwindle.

Did you know you can sell all or a portion of a life insurance policy, even term insurance?

Looking into selling a life insurance policy? Life settlements are an excellent choice for individuals who have a policy that they no longer want or need. But how much is a life settlement worth? How do companies calculate the worth of a policy? There are many factors that go into a life settlement offer, including the policy holder’s age, health, the policy type and size, premium cost, and the life insurance issuer. Let’s review these factors and more to see just how much a policyholder can receive from a life settlement. 

A policyholder could receive anywhere between 10% to 35% of the amount that would be paid when they die. On average, policyholders receive an upfront cash settlement that equals 20% of their life insurance policy death benefit. The larger the life insurance policy size, the larger the life settlement offer.

This means that an average life settlement offer on a $100,000 policy may be around $20,000 and an average offer on a $1,000,000 policy may be around $200,000.

There are a number of factors that affect the amount that a policyholder could be offered, including:

• Age of the Insured
• Health of the Insured
• Policy Type
• Policy Size
• Premium Costs
• The Life Insurance Issuer
• The Buyer’s Risk Profile

Here is a table that shows an example of how health status could affect the amount a policyholder could receive for their policy in a life settlement. The exception would be an insured in their early 80’s or older that is healthy, could still qualify to sell their policy.

Health Condition                       Type of Health Condition                        Value of Policy

Very Healthy                                No chronic conditions                                Not eligible for sale

Some Medical Issues                  Chronic but manageable conditions          10-25% of death benefit

                                                     such as hypertention

Serious Medical Conditions        Severe conditions such as cancer             25-35% of death benefit

Do I have to pay taxes if I sell my life insurance policy?

Possibly. Some of the money a policyholder could receive from a life settlement may be taxed as income or capital gains. Just like the sale of any other asset, a policyholder would likely have to pay taxes on the money they receive from a life settlement above their basis in the policy. The death benefit of a life insurance policy is tax-free to your beneficiaries.

How old do you have to be to sell your life insurance policy?

Although there is no set age range to sell your life insurance policy, you do have to qualify to sell a policy.  To be eligible to sell your life insurance policy, it is best to be over 65 years of age or have a serious medical condition. Most often the insured has a life expectancy of 15 years or less.

When would I get paid when selling a life insurance policy?

A policyholder would receive payment as soon as the necessary documents have been signed and the insurance company provides written confirmation that the owner and the beneficiary on the policy have been changed. It’s important to note that when selling a life insurance policy, the policyholder forfeits any money that would normally be paid when they die.

Life settlements may not work for everyone, but they’re a valuable option that many people don’t consider. If you have a life insurance policy that you’re planning to surrender, consider a life settlement. It might provide you with a valuable alternative.

By Rodney A. Brooks – Healthy Aging

July 12, 2021

More than 50 years ago, on July 30, 1965, President Lyndon Johnson signed Medicare into law, saying at the time, “I’ll spend the goddamn money,” he said. “I may cut back on tanks – but not on health.”

The story behind Medicare’s birth in Independence, Missouri, detailed here, reveals that LBJ called former President Harry Truman “The real daddy of Medicare.” (LBJ signed Medicare into law in Independence specifically to honor Truman’s effort to create national health insurance.) Truman became the first Medicare enrollee and Truman’s wife Bess got America’s second Medicare card – at the time, the monthly Part B premium was $3.

Quick facts about Medicare

• More than 50% of seniors had no health insurance prior to the establishment of Medicare, and 35% lived in poverty, according to the Center for Medicare Advocacy.
• Instant success – Medicare became effective in 1966, and more than 19 million people enrolled during its first year, increasing seniors’ access to physician and hospital care by a third.
• A model for universal healthcare – Medicare was initially conceived as a steppingstone to universal national healthcare. The Vietnam War put an end to that idea by syphoning off federal funds such an initiative would have required.
• A catalyst for desegregation – Medicare law required hospitals who wanted to accept Medicare patients to desegregate. More than one thousand integrated during the first four months.
• A plus for longevity – According to the New York Times, in the 30 years between 1970 and 2010, life expectancy at age 65 went up by five years, even though coverage was even more restricted than it is now. Analysts attribute the increase in part to Medicare enabling people to get early treatment.
• A boon for all – Ever been treated in the ER even though you lacked insurance? A 1985 ruling required emergency rooms at any hospital participating in Medicare to provide basic treatment to everyone, insured or not.

And now….

Growing, growing – What started as barebones insurance has grown into a robust program of coverage for seniors, with benefits added over the years: long-term disability insurance (1972), home health coverage (1980), hospice coverage (1982), prescription drug coverage (2006 – but initially only for those with private Medicare plans), expanded free wellness checkups and tests (2010, with the Affordable Care Act) and an end to the denial of coverage of skilled care for chronic diseases like Alzheimer’s based on a patient not improving (2012) and most recently, permanent repeal of Medicare’s annual physical therapy caps (2018).

 “I think there’s a significant potential that we will see a substantial expansion of home health care services,” says Social Security and Medicare expert Philip Moeller, author of Get What’s Yours from Medicare. “The Administration wants to provide something like $400 billion to expand the provision of home health care services.”

More than 52.6 million seniors are now covered by Medicare. Another 9 million disabled are also covered by Medicare. Enrollment is expected to reach 79 million by 2030, according to AARP.

Having previously introduced nursing home ratings, the Centers for Medicare and Medicaid is paying attention to the growing numbers of seniors who want to age in place and introduced a five-star ratings system for home health care on Medicare.gov. The ratings are based on patient surveys and let you search by zip code or name.

Medicare in its 56th year – what’s on the horizon?

The biggest change in Medicare has been the growth of Medicare Advantage Plans, says Moeller. Medicare Advantage Plans have grown to control 40 percent of the Medicare Market. That’s up from nearly 0 percent just 15 years ago. They are clearly the most popular choice of new enrollees to Medicare says Moeller. Enrollment is expected to reach 26 million in 2021.

People with end-stage renal disease are now eligible to join Medicare Advantage plans, the result of the 21^st Century Cures Act of 2021. Previously Medicare Advantage Plans were unavailable to them unless there was an ESRD Special Needs Plan available in their area.

High income brackets were introduced in 2007 for Part B and 2011 for Part D. For 2021, these thresholds have increased to $88,000 for a single person and $176,000 for a married couple. For 2021, the Part B premium for high-income beneficiaries ranges from $207.90/month to $504.90/month, depending on income.

Only 8% of Medicare beneficiaries switch plans in any given year. That number has not changed much in recent years. The Medicare Annual Election Period runs from Oct. 15 through Dec. 7, with coverage beginning Jan. 1. During this period you can change plans.

The standard Part B premium increased to $148.50 in 2021. The Part B deductible is $203 in 2021, up from $198 in 2020.

President Joe Biden had proposed cutting the age of Medicare eligibility to 60 and expanding Medicare to cover dental, hearing and vision during his campaign. But neither has been included in his legislative agenda so far. Medicare does not cover dental cleanings, root canals, eyeglasses, or hearing aids. Some progressive Democrats are pushing for expanding coverage for Medicare, but these would be expensive, and face Republican opposition.

Previously some politicians were pushing to raise the age of Medicare eligibility to 67. Medicare Part A is funded by the Medicare hospital trust fund. Since 2018 spending has exceeded revenue. The Kaiser Family Foundation (KFF.org) estimates that by the end of 2026 the fund will have a deficit of $31 billion.

By Dr. Barry M. Zisholtz, M.D., F. A. C. S

Kidney stones have been documented for thousands of years. They have been discovered in ancient Egyptian mummies, clearly well before we had the type of instrumentation and technology that we have in the 21st century. It is almost impossible to comprehend how ancient man dealt with something so painful without the proper instrumentation.

It is estimated that up to 3% of people will develop kidney stone disease by the age of 70, and, once you develop one stone, the recurrence rate ranges from 10% to 35% over the next five years.

For this reason and because kidney stones are such a painful condition, it is imperative that we do our best to take care of our bodies and avoid the pain of kidney stones.

Understand Your Risk

Kidney stones are most commonly seen in people between the ages of 20 and 40 but can present at almost any age. There are certain types of kidney stones that are hereditary and certain types of kidney stones are related to geography and climate as well.

The state of Georgia is in a location which we call “The Stone Belt” where the prevalence of kidney stone disease is at a much higher incidence than other parts of the United States. Therefore, especially in our state of Georgia, we should try and focus on prevention.

Most people think that kidney stones are just very painful conditions, but at times if associated with concurrent infection it could be a life-threatening condition. Kidney stones can even lead to loss of a kidney if left untreated. Sometimes kidney stones can even be painless!

The fact is, that all kidney stones are not the same. We will focus on dealing with prevention in a global sense but depending upon an individual‘s history, genetics, and other medical issues, there may be other factors and medications required to prevent kidney stones.

Prevent Kidney Stones from Happening to You

The consistent recommendation for people at risk for kidney stones is to drink plenty of fluids and be sure that one voids well over 2 liters of urine a day. A healthy lifestyle with proper diet and exercise will also help.

In addition, preventing urinary tract infections by using the restroom at regular intervals and ensuring that the bladder completely empties at those times may help prevent certain types of kidney stones from forming.

The Types of Kidney Stones

The most common kidney stones are made of calcium oxalate but that doesn’t mean in any shape or form that one has to avoid calcium. Based upon the type of stone, a full of evaluation can be made to determine how to prevent those specific stones.

For example, some stones may be related to a diet that is rich in oxalates which are found in nuts, spinach rhubarb cranberries, and asparagus. Some stones may be related to people living a sedentary lifestyle or with neurologic diseases that don’t allow them much mobility. There are some stones, such as uric acid stones, that are related to eating too much protein or may be related to a condition called gout. Certain type of stones such as Cystine stones are inherited as a genetic condition.

So, the take-home message is to drink plenty of fluids, live a healthy lifestyle, and if you do get a stone, once it is treated, an evaluation can be performed. Certainly, if multiple stones are found, a visit with a urologist can determine the cause, and the patient can be put on a specific individualized regimen to prevent further recurrences and to avoid the pain of kidney stones.

But unemployment resulting from Covid could temporarily reverse that positive trend.

InvestmentNews – May 27, 2021 – By Mary Beth Franklin

The percentage of Social Security recipients who file for benefits at the earliest age of 62 has been declining steadily for decades. That’s a positive trend for American retirement security since benefits increase for each year a recipient postpones filing for Social Security up to age 70.

But the decline in applications at the earliest claiming age may be more dramatic than previously published Social Security Administration data suggest. A new study by the Center for Retirement Research at Boston College says a better metric for capturing claiming behavior over time when the population is aging is the share of all workers turning age 62 who claim at 62. The CRR researchers note that the number of men who turned 62 has more than doubled from 829,000 in 1997 to about 1.7 million in 2019.

“The growing number of 62-year-olds makes it look like age 62 claiming is more prevalent than it actually is,” CRR director Alicia Munnell and assistant director Anqi Chen explained in their paper, Pre-Covid Trends in Social Security Claiming.

“The number we are after is the percentage of people reaching age 62 each year who claim at that age,” they wrote. They refer to this measure as “cohort” data.

The official data published in Social Security’s Annual Statistical Supplement shows that 34% of women and 31% of men who claimed retirement benefits in 2019 were age 62. But the CRR alternative measure, based on unpublished Social Security data, shows a steeper drop, with just one in four individuals claiming at 62 in 2019, the latest year for which data are available.

The percentage of retirees claiming retirement benefits at the earliest age of 62 has been dropping gradually for decades, aside from a brief reversal during the Great Recession, after which earliest claim applications resumed their downward trend.

From 1985 through 2005, the proportion of women claiming at 62 hovered around 60%, then it gradually dropped to 34% by 2019. During the same period, the proportion of men claiming at 62 stayed around 55% and then declined gradually to 31% by 2019.

Individuals whose full retirement age is 66 can claim benefits as early as age 62, but benefits are reduced by 25% when they claim four years early. The consequences of claiming benefits at 62 will be even more significant as the full retirement age gradually increases to 67 for people born in 1960 and later. For those people, claiming benefits five years early at age 62 will result in a 30% cut in lifetime benefits.

This year marks a major change in Social Security claiming rules as the full retirement age increases to 66 and 2 months in 2021, the first increase in the full retirement age in a dozen years.

In 2019, the other most popular claiming age was 66. That year, 30% of women and 36% of men filed for Social Security retirement benefits at their full retirement age, when benefits are worth 100% of their earned amount and restrictions on earnings from a job disappear.

“The big news here is that not only has the percentage of 62-year-olds claiming at 62 declined dramatically, but those who forgo early claiming appear to wait to the full retirement age to claim benefits,” Munnell and Chen wrote.

Only 9% of men and 6% of women waited until age 70 to claim their maximum retirement benefits, according to the CRR analysis. Benefits increase by 8% per year for every year an individual postpones claiming beyond full retirement age up to age 70. It makes no sense to delay claiming Social Security beyond age 70 as that is when the delayed retirement incentives end.

A major question remains: How has the Covid-19 pandemic affected Social Security claiming age behavior? Preliminary reports indicate that some older workers who lost their jobs or were fearful of the virus turned to Social Security to replace lost income. But an official accounting won’t be available for another year. The purpose of the CRR analysis is to provide a baseline against which to assess Covid’s impact.

“Our reading of the early evidence is that Covid and the ensuing recession have not pushed large numbers into early retirement — perhaps because those most affected cannot afford to stop working,” the authors concluded. “Regardless of the ultimate impact, Covid is not likely to permanently reverse the trend towards later claiming.”