Cognitive Screenings Growing Impact

Many approaches use a battery of screens. For example, a test now commonly used in the LTC insurance industry comprises 9 categories: orientation, attention, comprehension, repetition, naming, computation, verbal fluency, delayed word recall and judgment.

Researchers are attempting to narrow the necessary testing in order to save time and money. It is quite challenging to identify Alzheimers earlier (while avoiding false positives), with tests that are faster, cheaper and do not require a professional administrator.

Insurers will scramble to keep ahead of the curve. Improved screens will protect their bottom line, avoiding the risk that applicants might know more about their cognitive status than the insurer does. Effective screens will produce a healthier pool of insureds, thereby allowing lower prices. Expect to see cognitive testing at younger ages, perhaps more accessing of medical records (because of cognitive test results in the records), and perhaps a direct question about cognitive testing on the application.

From an agents point of view, the impact of these screens will cut several ways. Of course, some applicants will be rejected who might currently be approved. On the other hand, it is also likely that some applicants will be approved, who would have been rejected using current practices. For example, doctors records of a vague complaint about memory often lead to a “decline” decision. In the future, the doctors records might show a normal cognitive test, thereby erasing such concern; the insurer might trust its underwriting cognitive screen to distinguish between significant and insignificant notes of such type.

If early detection and treatment of Alzheimers result in less catastrophic outcomes, interest in LTC insurance may decline or people may feel less need for long benefit periods. On the other hand, people will increasingly understand that, at any time, they could suddenly become uninsurable.

Agents might become involved by sponsoring a screening program at a local senior center or church. They could directly offer a cognitive test to clients or prospects, either for people worried about themselves or people worried about loved ones. Providing such service can build an agents “brand” and produce more referrals. (Note: Although agents could administer the tests, they may prefer to provide access without administering the test or seeing the results.)

Developments in cognitive testing will significantly impact marketing, selling, underwriting and claims handling in the LTC insurance industry. It may behoove agents to consider how to succeed in the new environment.

is president of Thau Inc., a Mission, Kan., consulting and wholesaling firm focused on the LTC insurance industry. He can be reached at [email protected].

Reproduced from National Underwriter Edition, January 20, 2005. Copyright 2005 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.