NU Online News Service, April 10, 7:03 p.m. – The head of the company in charge of the huge new Federal Long Term Care Insurance Program today assured the U.S. Senate Select Committee on Aging that the government got a good deal.
Paul Forte, chief executive of Long Term Care Partners L.L.C., a new venture formed by MetLife Inc., New York, and John Hancock Financial Services Inc., Boston, testified at a committee hearing that the U.S. Office of Personnel Management took unusual care when it selected his company to handle the seven-year contract.
Congress authorized OPM to set up the LTC program in 2000, and OPM awarded the contract to Long Term Care Partners in December 2001. As many as 20 million federal workers, dependents and retirees may be eligible to sign up for coverage through the voluntary, participant-paid program, officials estimate.
The aim of the OPM officials who reviewed bidders’ proposals “was to secure not only the strongest possible plan design at the best possible price, but to ensure, through good administration, that plan design would stay meaningful and that the program would continue to be competitively priced in the years ahead,” Forte said, according to a written version of his remarks.
Some LTC insurance brokers have suggested that certain eligible groups, such as retirees, who get no special underwriting relief when buying through the federal LTC program, can find better prices by shopping for coverage on their own.
But Forte argued that program rates are low, given the quality of the program and the wealth of benefits it offers.
Unusual program features include substantial benefits for informal home care provided by relatives, a binding mediation process for participants who appeal claim decisions, and the “largest education and awareness campaign ever conducted on the subject of long-term care and long-term care financing,” Forte said.
Long Term Care Partners has already held one satellite broadcast to explain the program to potential participants, and it expects to hold at least two more satellite broadcasts to answer more questions in the next few months, Forte said.