LTCP Training Update -- Shifting Focus: Ongoing Training

At this point in the roll-out of new LTCI/LTC partnership training requirements, a number of states have had their requirements in place for a year or more. In these states, the focus is shifting from the initial training to the ongoing training, which must be taken every two years following completion of the initial training. In this month’s article, we discuss the requirements for ongoing training and the course that AHIP is introducing to meet these requirements.

Meanwhile, in many states, the initial training remains the priority, and new states continue to establish their initial training requirements. Recently Kansas and West Virginia issued rules, and Wyoming and New Hampshire are expected to do so shortly. For details, check out the state reports below. As always, we provide current information on the training requirements and regulatory developments in all 50 states.

Ongoing Training — What Is Required and the AHIP Solution

As our readers well know, long-term care insurance is an ever-evolving field. Insurance companies continually strive to better meet the changing needs and goals of consumers by developing new products and policy features, new regulations are issued and old ones amended, and the marketplace fluctuates with economic trends and other factors.

In addition, currently long-term care partnerships are a source of change. Not only are they having an impact on the LTCI market, but also, as the states implement their partnerships, they are developing rules affecting partnership-qualified LTCI policies, so that the regulatory framework for these policies is emerging gradually.

Because of the evolving nature of both LTCI and LTC partnerships, states are requiring LTCI agents to take not only an initial training course but also ongoing training, in most cases four hours every two years after they complete the initial training. (For the details for each state, see the state reports below.) The purpose of this ongoing training is two-fold:

• to review and reinforce knowledge of LTCI, LTC partnerships, and related topics; and

• to bring agents up-to-date on developments in the field.

AHIP is proud to introduce a new course designed to fulfill this ongoing training requirement. Our course offers:

• thorough coverage of all topics required by the NAIC model for the ongoing training: long-term care, long-term care insurance, other means (public and private) of funding long-term care, LTC partnerships, and suitability; and

• updates on recent developments in these areas. Students will learn about new LTCI product features and designs such as cash/reimbursement hybrids, graded inflation protection, 80% coverage of expenses, graded premium options, starter cash benefits, and many others–innovations that all agents need to become familiar with. We also provide information on LTCI market trends, current costs of long-term care services, and regulatory developments such as independent third-party claim review.

And perhaps most important, students learn about state rules affecting LTC partnerships and partnership-qualified (PQ) LTCI policies. When the initial training was introduced, states were just beginning to develop their regulations, and a number of important issues remained unresolved. But many questions can now be answered, such as these:

• What inflation protection is required for buyers of a PQ policy age 60 and younger? Does it have to be 5% compound automatic inflation protection? Or can it be a lower percentage or a guaranteed purchase option? Can an insured drop or downgrade her inflation protection after she reaches age 61?
• What if an individual wants to exchange a non-PQ policy for a PQ policy: Can she do this? Is the insurer required to do this? Can it be done by means of a rider? Is the insurer allowed to conduct underwriting or raise the premium?
• What if a person buys a PQ LTCI policy in one state and moves to another: Is she entitled to partnership asset protection in the new state? Must she change her policy to meet the new state’s PQ requirements?
• What if a person receives benefits from a PQ policy, later qualifies for Medicaid, and is able to protect some of her assets: Can she spend those assets? Can she give them to someone else? What if they increase or decrease in value? What if she acquires additional assets, perhaps through an inheritance? Can she change the assets she wants to protect?
• Those who take AHIP’s course will learn the answers to these questions and others, reinforce and update their knowledge of the long-term care field, and fulfill the ongoing training requirement. The course is currently being submitted to states for approval, and we expect to be able to offer it in some states in June and in the rest soon afterward.

State Reports as of May 2009

Note: California, Connecticut, Indiana, and New York have had long-term care partnership programs in operation for several years and are often referred to as the “original partnership” states. These programs are in many ways different from the new partnerships currently being established in other states in response to the federal Deficit Reduction Act (DRA) of 2005. Their training requirements do not follow the NAIC model created to implement the DRA and adopted by most new partnership states. Therefore, agents who take training based on the NAIC model will not meet the requirements of the four original states, and those who take partnership training in one of the original states will not meet the requirements of the new states (although in some cases reciprocity may be granted anyway).

Check With Your Carrier!

We would like to remind agents that some states do not review and approve courses as meeting their LTCI/LTC partnership training requirements. In these states, it is up to the carrier to decide whether a course fulfills the state requirements. And in all states, carriers must track agents’ completion of the required training. So in seeking to meet state training requirements, always check with the carrier or carriers you represent.

Alabama. All LTCI agents must complete an eight-hour initial training course. The course must be based on the NAIC model (no state-specific content required) and approved by the state for long-term care CE credits. Courses approved for general CE do not fulfill this requirement, even if they address long-term care and have “long-term care” in the title. (AHIP’s course is approved for LTC and fulfills the requirement.) Agents already licensed for LTCI before March 1, 2009, have until December 31, 2009, to complete the initial training; new agents (those not already licensed before March 1, 2009) must complete the initial training before selling LTCI. Agents are also required to complete four hours of ongoing training during every 24-month license renewal period after the period in which they completed the initial training.

Alaska. No action to establish an LTC partnership has been reported, and the state currently has no agent training requirements specific to long-term care insurance.

Arizona. All LTCI agents must complete eight hours of initial training based on the NAIC model by June 30, 2009. Agents must also complete four hours of ongoing training during each 24-month period beginning July 1, 2009, after the 24-month period in which they completed the initial training.

Arkansas. All LTCI agents must receive eight hours of initial training, with content based on the NAIC model plus a state-issued supplement on the Arkansas partnership and Medicaid programs. All agents must complete this initial training before selling partnership policies. Agents who were already selling LTCI as of July 1, 2008, may continue to sell non-partnership policies without completing the training, until July 1, 2009. Agents not already selling LTCI as of July 1, 2008, were allowed to sell non-partnership policies without the training until January 1, 2009, but these agents must now complete the training before selling any type of LTCI policy. Agents must also complete four hours of ongoing training during every 24-month license renewal period after the period in which they completed the initial training.

California is one of the original partnership states (see note above). Before selling partnership policies, agents must complete eight hours of general long-term care training and eight hours of training specific to the California LTC partnership. The partnership-specific training must be received in a classroom setting. In addition, eight hours of ongoing classroom partnership training must be taken during every two-year license approval period.

Colorado. As of Jan. 1, 2009, all resident LTCI agents must complete 16 hours of initial training before selling LTCI. This training must include the topics of the NAIC model plus substantial additional content, as stipulated by the state. Eight hours must cover long-term care and long-term care insurance and can be classroom, self-study, or Internet-based; the other eight hours must focus on partnership and must be classroom training. Agents must also Complete five hours of ongoing training (classroom only) during every 24-month CE period after the period in which they completed the initial training. Nonresident agents do not have to meet these requirements; to sell LTCI in Colorado, a nonresident must meet the LTCI training requirements of her home state and hold a Colorado nonresident license for life insurance or accident and health insurance.

Connecticut is one of the original partnership states (see note above). To sell partnership policies, an agent must complete first a prerequisite online course approved by the partnership program and then four hours of classroom instruction conducted by partnership program staff.

Delaware. No action to establish an LTC partnership has been reported. To sell LTCI, an agent must meet the training requirements for a health insurance license and also, every two years, complete a three-hour course in LTCI approved by the state.

District of Columbia. No action to establish an LTC partnership or new LTCI training requirements has been reported. Currently there are no training requirements specific to LTCI — an agent must simply be licensed to sell life and health insurance.

Florida. At present, all LTCI agents must complete eight hours of initial training based on the NAIC model before selling LTCI policies. Agents must also complete four hours of ongoing training every 24 months, beginning on the date they completed the initial training. In addition, the state is currently developing a rule under which agents will have to complete two hours of Florida-specific training (on the state’s Medicaid and partnership programs and its regulations), either as part of the initial eight-hour training or in addition to it. (This rule is expected to be finalized soon, but it is not yet in effect.)

Georgia. As of Jan. 1, 2009, agents intending to sell partnership policies (not all LTCI agents) must complete initial training before selling. The initial training consists of the NAIC model plus two hours of state-specific content, for a total of eight hours. Georgia resident agents who have already taken the training required to sell partnership policies in another state may receive up to six hours credit for that training and need to take only the two hours of Georgia-specific training. Nonresident agents who are qualified to sell partnership policies in their home state need to take only the Georgia-specific training.

Agents selling partnership policies must also take four hours of ongoing training during every two-year license renewal period, which runs from January 1 to January 1. The first ongoing training must be completed by the second January 1 after completion of the initial training. To give some examples: Mary Jones completed the initial training on Oct. 14, 2008; she has until Jan. 1, 2010, to complete the first ongoing training. Bob Smith completes the initial training on Feb. 6, 2009; he has until Jan. 1, 2011.

Hawaii. In 2007, the legislature passed a bill requiring all LTCI agents to complete eight hours of training based on the NAIC model. But this requirement will not go into effect until the state’s partnership program is established, and it is unclear when that might happen — a partnership bill failed to pass in the 2008 and 2009 legislative sessions but may be reintroduced in 2010. The bottom line for agents: There are no partnership training requirements in effect at this time; there will be no such requirements until the partnership is established; and when that occurs, agents will have one year from that date to complete the training.

Idaho. All LTCI agents must complete eight hours of initial training based on the NAIC model before selling LTCI products. They must also take four hours of ongoing training during every 24-month license renewal period after the period in which they completed the initial training.

Illinois. All LTCI agents must complete course 25008. To be approved by the state as 25008, a course must cover the NAIC content and provide at least eight hours of instruction. (AHIP’s NAIC Model Course is approved.) Agents who had completed the previously required LTCI course (09400) as of July 1, 2008, are allowed to continue selling LTCI without completing 25008, until July 1, 2009. Agents who had not completed course 09400 by July 1, 2008, may not sell LTCI until they complete course 25008. As for ongoing training, all agents must complete four CE credits in long-term care during each 24-month license renewal period after the period in which they completed the initial training.

Indiana is one of the original partnership states (see note above). To sell LTCI, agents must take eight hours of initial training and five hours of ongoing training every two years. To sell partnership policies, agents must also take seven hours of partnership training (classroom only). Agents licensed in another state are exempt from the general LTCI requirement, but to sell partnership policies they must receive the seven hours of Indiana partnership training.

Iowa. As of Jan.1, 2009, all LTCI agents must complete initial training before selling LTCI. This initial training is based on the NAIC model but is only four hours, not the usual eight. AHIP offers Iowa agents its eight-hour NAIC Model Course, as we believe it best meets their needs. This course fulfills the state’s requirement, and it gives Iowa agents the opportunity to earn additional CE credits and qualify to sell LTCI in other states. (Iowa agents who take a four-hour Iowa course will not be able to qualify in most other states without taking an eight-hour NAIC model course.) Iowa agents must also take three hours of ongoing training during every three-year CE term.

Kansas. Training requirements have recently been approved. Effective July 1, 2010, agents selling partnership policies (not all LTCI agents) must complete four hours of initial training. Partnership agents must also take one hour of ongoing training during every two-year license renewal period after the period in which they completed the initial training. In both cases, courses must be certified for partnership training by the Commissioner of Insurance.

Kentucky is establishing an LTC partnership, and partnership policies are expected to be available for sale beginning July 1, 2009. Agents intending to sell partnership policies (not all LTCI agents) must complete eight hours of initial training before selling. This initial training must cover the topics of the NAIC model as well as certain Kentucky-specific content stipulated by the state. Agents selling partnership products must also take four hours of ongoing training during each 24-month license renewal period after the period in which they completed the initial training. Note that although the state requires only agents selling partnership policies to receive this training, it is expected that many carriers will require all agents to take it. Nonresident agents who meet the partnership training requirements of their home state will not be required to meet Kentucky’s requirements. AHIP’s course has been approved by Kentucky and is now available for this state.

Louisiana is finalizing a state plan amendment (SPA) seeking authorization to establish an LTC partnership and expects to submit it to the federal government in June. Currently, there are no training requirements specific to long-term care insurance; to sell LTCI, agents must be licensed to sell accident and health insurance.

Maine. All LTCI agents must complete eight hours of initial training based on the NAIC model before selling LTCI. An agent must also take four hours of ongoing training during every 24-month period beginning on the date he or she completed the initial training.

Maryland. Maryland’s state plan amendment (SPA) establishing an LTC partnership was approved by the federal government on March 31, with a retroactive effective date of Jan. 1, 2009. All LTCI agents must complete eight hours of initial training based on the NAIC model before selling LTCI. An agent must also take four hours of ongoing training during every 24-month period beginning on the date he or she completed the initial training.

Massachusetts. No action to establish an LTC partnership or new LTCI training requirements has been reported. The state does not currently have training requirements specific to LTCI; the only requirement is that LTCI agents be licensed to sell accident and sickness insurance and meet continuing education requirements for accident and sickness. However, carriers are required to provide agents selling LTCI with training in the product.

Michigan. The federal Centers for Medicare and Medicaid Services (CMS) and the state are discussing issues involving Medicaid estate recovery, and this matter must be resolved before Michigan’s partnership program can be approved and related training requirements issued. Progress continues to be made, but final resolution has not yet been reached.

Minnesota requires resident agents to take a state-specific course before selling LTCI. It is eight hours and is based on the NAIC model, but state-specific information must be incorporated into the course (unlike in other states, where it can be added as a supplement). Nonresident agents can qualify to sell LTCI by taking an eight-hour NAIC model course in another state plus Minnesota-specific content. Agents must also take four hours of ongoing training every 24 months, beginning on the date the agent completed the initial training.

Mississippi. No action to establish an LTC partnership or new LTCI training requirements has been reported. Currently there are no training requirements specific to LTCI — an agent must simply be licensed to sell life, accident, and health insurance.

Missouri. Before selling partnership policies, agents must complete eight hours of initial training based on the NAIC model. (State-specific content is not required, although the state strongly recommends that agents familiarize themselves with Missouri’s Medicaid and partnership programs, and AHIP’s course includes material on this.) Agents must also take four hours of ongoing training during every 24-month license renewal/CE period after the period in which they completed the initial training. (These requirements do not apply to LTCI agents not selling partnership products.)

Montana. All LTCI agents must take eight hours of initial training based on the NAIC model before selling LTCI. Agents must also complete four hours of ongoing training every 24 months beginning July 1, 2008.

Nebraska. All LTCI agents must complete eight hours of initial training before selling LTCI. This initial training consists of the NAIC model plus state-specific information. Agents must also take four hours of ongoing training during every 24-month license renewal period after the period in which they completed the initial training.

Nevada. The state has not and does not plan to issue specific partnership training requirements, such as minimum hours, topics to be covered, or deadlines, and it does not approve courses. Rather, the state requires insurers to certify that agents selling partnership policies meet the training standard of the federal Deficit Reduction Act (DRA) — that is, that they have “received training and demonstrated evidence of an understanding of the partnership policies and their relationship to public and private coverage of long-term care.” It is up to insurers to decide whether a course meets this standard, and consequently Nevada agents should consult with the carriers they represent and fulfill the training requirements of those companies.

New Hampshire has received federal approval of its LTC partnership program, and related state rules are currently being developed. These include proposed (but not final) training requirements under which producers selling partnership policies (not all LTCI producers) would have to complete eight hours of initial training based on the NAIC model before beginning to sell. Partnership producers would also have to take four hours of ongoing training every two years. We emphasize that these requirements are not yet final and subject to change.

New Jersey. All LTCI agents must complete eight hours of initial training based on the NAIC model. Agents already licensed for LTCI before Feb. 17, 2009, have until July 1, 2009, to complete this initial training; new agents (those not licensed before Feb.17, 2009) must complete it before selling. Agents must also take four hours of ongoing training every 24 months. (The exact timeframe for the ongoing training is not specified by the state; insurers, who are responsible for ensuring agent compliance with the requirements, may use their own discretion.)

New Mexico has begun initial discussions on the establishment of an LTC partnership. Currently no special training is required to sell LTCI, only a health insurance license.

New York is one of the original partnership states (see note above). To sell partnership policies, agents must complete eight hours of training, consisting of a four-hour online course followed by four hours of classroom instruction.

North Carolina is currently taking steps to establish an LTC partnership and will develop related training requirements. Presently LTCI agents must hold both a health insurance license and a special license requiring 10 additional hours of training.