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Life Health > Long-Term Care Planning

Early Enrollment Begins For Federal LTCI Program

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NU Online News Service, March 25, 3:29 p.m. – An early enrollment period begins today for the Federal Long Term Care Insurance Program offered by the U.S. Office of Personnel Management.

The program, offered to federal and postal employees and annuitants, members and retired members of the uniformed services and qualified relatives, is underwritten by Long Term Care Partners, a joint venture between John Hancock Financial Services Inc., Boston, and MetLife Inc., New York.

The early enrollment period, which runs until May 15, is designed for people already familiar with long term care insurance who want information about the rates and features of the federal program.

Many long-term care insurance brokers and carriers not involved with the government program have welcomed the federal program, arguing that the marketing push behind it will boost the credibility and visibility of all long-term care insurance products.

Other insurers and brokers have questioned the program’s delays at getting rate information to potential plan enrollees.

The new federal program is not using a uniform approach to pricing.

Instead, calculations of premiums take into account the enrollee’s age and the benefit period, waiting period and inflation protection option chosen.

“Benefit period” refers to the length of time benefits will last if the policyholder receives care every single day at a cost equal to or more than the daily benefit amount. During early enrollment period, enrollees can choose either a three- or five-year benefit period. During open season, from July 1 to Dec. 31, a lifetime benefit period will be offered.

“Waiting period” refers to the number of days during which an enrollee must be eligible for benefits and receiving covered services before benefits start. It works like a deductible.

The inflation protection choices are an automatic compound inflation option and a future purchase option. With the automatic option, the daily benefit amount will increase by 5% annually with no corresponding increase in premium. The initial premium is higher with this option. The future-purchase option allows an enrollee to buy additional coverage every two years at an extra cost. Each time additional coverage is bought the premium increases.

A 55-year-old who wants a $50 daily benefit with a three-year benefit period, a 30-day waiting period and the future purchase option would pay $16.70 in monthly premiums.

For a 55-year-old who wants a $100 daily benefit with a three-year benefit period, a 90-day waiting period and a future purchase option, the monthly premium is $29.60.

The program offers a benefits package that pays benefits toward services including: nursing home care; assisted living facilities; home care; adult day care; hospice care; respite care when a policyholder’s primary caregiver needs a rest; and bed reservations, or payments made to a nursing home or assisted living facility to hold a bed while a policyholder is hospitalized or out of the facility on therapeutic leave.

Arthur Stein, a long-term care insurance specialist with Cassaday & Company Inc., McLean, Va., has put a chart comparing prices for the federal program what prices for comparable policies available through the private market on his Web site, at

Some federal employees and spouses of employees with health problems should have an easier time buying coverage through the federal program than they would through the private market, Stein says.


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