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Smitty77 · 05-30-2016, 09:25 AM

Well now year third full year of retirement, and again we're taking a hit to our budget from ACA ongoing impact.

We planned our retirement before the impact of ACA to Pre 65 Health Insurance was known. I had obtained multiple quotes, and used a 20% per year escalation increase on my retirement planning spread sheet. The first year out of the chute, we were blown out of the water with about a 100% increase over planned, and of course, it's gone up each year after that. Consumed the bulk of our contingency line item, and has impacted our planned travel in the early years while we were both in good health.

Got the notice from NYL, that for the first time ever, they're increasing their LTC. Ours is going up 20%. While they of course did not state this was direct result of ACA, they did mentioned overall higher escalation then had been forecasted in medical costs. And informal conversation with my Financial Advisor, made it pretty clear that ACA's ripple effect of overall costs in the medical community, was the root cause of this increase.

So, we'll tighten budget belts again.

For my wife and I, even if DC were to go in and start the process to fix many of the problems in ACA, it will be too late to undue the damage already. And suspect it would take a year or two for it to get thru the DC games, and then rolled out. By then I'll be 65, and so it will not help on my costs, but the DW has another 7 years to go before 65, so it might help her some too...

And note, not all Long Term Care policies are written the same way. Some have guaranteed costs, some like us, have the clause that increases maybe needed. Though again, it is the first time NYL has ever had to do this.

Best to all and if you have LTC, hope your plans do not take a spike up as ours has

!

Smitty

TomandGloria · 05-30-2016, 09:36 AM

Yup, saw in NARFE magazine that ours is going up as well. Pretty disappointing that we keep suffer rate increases without real COLA increases to help offset.

TechWriter · 05-30-2016, 12:45 PM

Quote:

Originally Posted by Smitty77

Got the notice from NYL, that for the first time ever, they're increasing their LTC. Ours is going up 20%. While they of course did not state this was direct result of ACA, they did mentioned overall higher escalation then had been forecasted in medical costs. And informal conversation with my Financial Advisor, made it pretty clear that ACA's ripple effect of overall costs in the medical community, was the root cause of this increase.

You may want to look at getting advice from another advisor.

In several articles I looked at about Long Term Care premium increases, the ACA was never mentioned as the cause.

The cause seems to be poor planning by insurance companies -- to begin with, the policies were priced wrong and people are living longer.

Here are some articles on Long Term Care costs:

While the ACA is certainly far from perfect, it doesn't cause gout or increases in Long Term Care costs. Your financial advisor seems to be using the ACA as a whipping boy.

Finally, it looks like you're domiciling in SD? Why??? If you have to purchase individual health insurance, SD is one of the worst states to stay.

Smitty77 · 05-30-2016, 08:16 PM

Techwriter - Thanks for sharing those links, two I had read before I posted, as well as others besides the ones you posted.

And for sure, I could have done a better job to state that it was not all just a result of ACA. LTC, while having been around for awhile, is still relatively young in regards to the full scheme of differing insurances... So the industry as a whole is still learning and adjusting.

And my FA is fine, and I took one comment out of many form him, as we had a good long conversations on many fronts. Another point, is the higher cost of minimum wage, sad to think that many LTC givers are impacted by minimum wage. I will go one step further in defense of my FA, in saying I determined by our conversation that ACA had had the ripple effect - 'root cause' was my choice of wording, not his. And it was probably not a fair choice of words - 'contributing cause' wound have been better.

I'm, well my wife and I, are probably no different then many others Pre 65 retirees. I have a health care plan that I've retained from my former companies Group Retirement Plan. This is out of North Carolina, and happens to be Athem/Blue Cross. In our case, the LTC was based upon the state of California, which was our legal residence at the time it was issued. Our current Domicile of South Dakota, has not change on the LTC policy from California.

No question that LTC will go up again, and dependent upon many reasons, not all ACA. So thanks for pointing out that I was not fair in my assessment of being 'root cause'.

My main goal, was to caution others to be ready for potential budget impacts as LTC's are increased for various reasons. Minimum wage increases; Longer life expectancies of the baby boomers; Overall higher costs of medical (ACA increases lumped into this one too); General overall higher costs of medicines; Higher just about everything

!

Thanks again for your links. Suggest others read these, and others that have different views. (One thing for sure, Google can find viewpoints from all sides of an issue

!).

LTC is just one of many important decisions points. And many come to a conclusion that they're just not worth it, even if they know how important it could be to the future for asset protection. The reality is, if we all had all of the different kinds of insurance that are available - we'd all be in the poor house

!

Best to you, and all. And just be aware that if you have a LTC plan, premium increases could be coming your way too.

Smitty