Waterlily: Taking the guesswork out of LTC planning

By Susan Rupe

Long-term care planning is a challenge for advisors and clients alike. What is the likelihood that a client will need care someday? What is the likelihood that a client will develop Alzheimer’s disease or some other form of dementia? How can an advisor recommend the correct product or develop the right plan for a client’s future needs when no one knows what the future could bring?

Waterlily is a platform that uses artificial intelligence to predict future aging care needs and costs, providing educational tools for advisors to help clients plan for these expenses.

Lily Vittayarukskul is founder and CEO of Waterlily, which she said she was inspired to create two years ago, after her Cambodian immigrant family’s experience in caring for an aunt who had terminal colon cancer.

“We had to navigate her long-term care needs for two years and it wiped our family out financially,” Vittayarukskul told InsuranceNewsNet. “The main reason I founded Waterlily is because this really tore my extended family apart.”

Vittayarukskul said every household in the U.S. will eventually have to deal with a long-term care event. “We believe that if you help educate that younger family about what their future aging care needs will look like, what they will cost and the approaches to solving for that cost, the family will likely have better outcomes,” she said.

Predicting the need

Waterlily involves two steps. The first step is predicting what a client’s future long-term care needs will be.

“We essentially try to help the agent or advisor sit with their client and understand or predict their future needs,” Vittayarukskul said. “We have an intake form where we ask for social, demographic, medical and financial information, and it takes about three minutes to complete that.”

Waterlily uses a set of a half-billion data points. Looking at 20-30 years’ worth of data from all the households most like the client who provided the information to their advisors, Waterlily can predict the likelihood of needing long-term care and at what age the client can expect to begin needing long-term care, as well as how long the need for care will extend and the growing intensity of the need for care.

“We predict it down to the level of how long you will need help with one or two activities of daily living, three to four ADLs and five to six ADLs,” Vittayarukskul said. “And we can look at how that care will be distributed: Will it be done by professionals or by family members? Then we can leverage that and layer in other factors. What is the average cost of care in your ZIP code? What are the chances that you age at home or in a facility? This gives us a clear sense of what this is going to cost.”

How much will it cost?

From there, she said, the next step is for the advisor and the client to create a plan to cover the cost of care.

Taking the information extracted from the client’s intake form and incorporating that with Waterlily’s half-billion data points of information, the client has a prediction of how many years of care will be needed and at what age that care will begin. For example, Waterlily could predict that client will need care for four years, starting with 20 hours of care per week and eventually requiring 50 hours of care weekly.

“Now we look at the duration of time you will need care and the ZIP code where you live,” Vittayarukskul said. “We break everything down to include health care inflation. We also look at the likelihood that your family members will step in and provide care and how that subsidizes your cost of care. And then we get a sense of your preferences, of how you want to age, and how that progresses as you go from needing help with three or four ADLs to needing help with five or six ADLs. For example, we can predict that you will need help with three or four ADLs for about a year and a half and then move into the final stage of needing help with five or six ADLs for just over a year.”

Waterlily helps build out a plan

After the predictions are made, Waterlily gives the client the information needed to build out a care plan.

“The plan isn’t, ‘Here’s insurance. Now go buy it,’” Vittayarukskul said. “We have clients fill out a survey. They can enter information on whether a family member can provide care and for how long. They provide information on where they want to receive care; whether it’s at home or in a full-care facility.”

After the client’s preferences are entered, Waterlily gives them an estimate of the cost of that care so that clients have a target number to plan for.

“How do we solve for that number?” Vittayarukskul said. Some clients say they want to self-fund. How will they do that? How much income will they have that they can put toward care? How much money do they have now that they can divert every month or every year to put toward care?”

From there, advisors can connect the client with products that can help them pay for their eventual care or develop a plan to invest funds for future care.

Waterlily is available through distributors and independent marketing organizations, but individual advisors also can subscribe to the platform.

Susan Rupe is managing editor for InsuranceNewsNet. She formerly served as communications director for an insurance agents' association and was an award-winning newspaper reporter and editor. Contact her at [email protected].