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How Long Term Care Insurance Can Help Clients Avoid Long Term Care Rationing

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In the 1940s, the United States voluntarily rationed scarce commodities to ensure that soldiers would have the food and support they needed to fight our cause overseas. Back then, rationing took place for the nation’s greater good.

More recently, politicians have thrown around the term “health care rationing” as a way to scare consumers, but the fact is that health care rationing takes place every day. Today, the scarce commodity isn’t butter or sugar — it’s money.

Most Americans understand that when medical funds are limited, so are the available options. Indeed, we regularly self-ration. Suppose you develop an irritating rash. You could go to the doctor and fork over either the copayment or the full cost of the visit from your own pocket. Then, you’ll pay again some amount for whatever prescription your doctor writes. Or, you may choose to first try an over-the-counter rash treatment instead. In doing so, you have effectively self-rationed your care and saved your money for something you believe is more important.

In the years ahead, successful insurance professionals will find themselves using the concept of rationing to establish the value of purchasing long term care insurance.

As I write this, the final outcome of health care reform is unknown, and the inclusion of a universal long term care insurance option, while likely, is still uncertain. But one thing’s for sure: Our nation’s citizenry is facing at least decade during with resources will be limited. More consumers will be forced to ration virtually every decision that involves cost. The greater the cost, the more people will face difficult decisions. And, when it comes to the need for long term care, we’re not talking about just an irritating rash — we’re talking about facilities that won’t be staffed to provide adequate care.

While we should all run our lives according to “The Golden Rule,” the long-term effects of our economic malaise will likely result in more people living by a new-age golden rule — that those who have the gold make the rules. And, when it comes to long term care (or medical care, for that matter), having the “gold” means either having the money to self-fund care, or having an insurance policy ready to cover cost.

Marketing long term care insurance in the years to come will involve more and more agents positioning coverage as a way to avoid an inevitable rationing of long term care options. The government programs of tomorrow will bear little resemblance to those in place today. Your clients will want to purchase long term care insurance not simply because there’s a risk they may need it, but because there’s an even greater risk that today’s government programs will be forced to severely ration what’s available.

Consumer education will require an understanding of government programs and, in particular, their potential lack of universally desired benefits. Prospects will understand that the federal and state governments cannot raise enough funds by taxing employers or younger workers to pay for the burgeoning needs of aging baby boomers. The government, through Medicare, state Medicaid, or other programs, will need to keep costs as low as possible in order to keep taxes low or to meet other such pressing needs as education, roads, and national debt repayment. Rationing is inevitable.

The best option to ensure that your clients have choices and control over where they will receive care and from whom they’ll receive care is for them to stockpile what they’ll need in order to avoid rationing. Long term care insurance is the simple, affordable solution to rationing, and makes for a powerful message.

Jesse Slome is the executive director of the American Association for Long-Term Care Insurance. He can be reached at [email protected].


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