From Prescription Drug Plans to Long Term Care Policies
Long Term Care Insurance
As millions of Americans recover from the daunting choice among prescription drug plans (deadline was May 15), the Government is forcing another health care decision. And this one's a doozie, according to LTC Financial Partners LLC. "Which long term care insurance policy should you pick?"
Your answer involves much greater risk than a poor choice among drug plans. Drugs may cost thousands per year (the standard Medicare Part D drug benefit provides an initial coverage limit of $2,250). But long term care services cost tens of thousands per year. According to the MetLife Mature Market Institute, the national average cost for care in a nursing home is $74,000 per year (for a private room); in your own home, the cost is $23,400 per year (for a home health aide).
"Looking at the numbers," says Cameron Truesdell, CEO of LTC Financial Partners, "you could say a bad pick for long term care has 10 to 30 times the impact as a bad pick among drug plans." Apparently the federal government agrees, as it quietly extends its Long-Term Care Consumer Awareness Campaign. The campaign uses radio, TV, and direct-mail to educate Americans on the need to plan for their own care. "The underlying message is, don't count on Medicaid or Medicare to pick up the tab," says Truesdell.
There is no deadline, as there was with prescription drugs, for choosing a long term care insurance policy. Rather, Uncle Sam is pursuing a course of gradual persuasion. In addition to raising awareness, the campaign offers helpful items like checklists for deciding among alternative policies. And Congress offers tax incentives in the Deficit Reduction Act of 2005, signed by President Bush on February 8. "There's no date when you absolutely have to pick an LTC policy," says Truesdell, "but the downside of delay is great. The clock is ticking."
Okay, maybe you're ready to pick a policy. But there's a problem. It's the same problem faced by Americans trying to pick a prescription drug plan. How do you choose among confusing alternatives? Truesdell points out: "You can end up with a poor-performing company; you can overpay for coverage; or you can miss out on options like group coverage, which can reduce the premium." To help applicants pick a prescription drug plan, Medicare provided an online decision system. No such help is available from Washington for choosing a long term care plan.
Truesdell's organization is filling the gap with a private system called the LTC Outreach and Education Program(TM) (LTCOEP(TM)). It includes a process that matches individual needs against many policies from multiple carriers, and factors in relevant state and federal legislation. LTCOEP(TM) also includes live assistance from local experts; group presentations; and a range of audio-visual and print materials. The program is available to local groups and companies as well as individual families.
LTC Financial Partners is the nation's most experienced long term care insurance brokerage, representing multiple leading carriers including John Hancock, MetLife, Alliance, Prudential, MedAmerica, Penn Treaty, Physicians Mutual, and UnimProvident. The organization has 180-plus Partners covering the continental United States. They are all state-certified experts who specialize in long term care insurance and its financial benefits for individuals and companies.