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What Could Go Right?

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I’m a superstitious optimist. I always expect the best but somehow think that worrying about and planning for the worst will make sure the best outcome comes true.

Of course, right now, the long-term care insurance (LTCI) industry looks as if it’s in a not-especially-pleasant situation. It’s easy, and reasonable, to start an article with an attention-getting suggestion that some manner of doom might be a few minutes away.

Certainly, a prediction of doom seems more honest than a lead based on the premise that nothing is amiss at a time when it looks as if LTCI carriers are competing to see which can get all 50 states and the District of Columbia to approve their 999% rate hikes fastest.

But plague never killed everyone, the United States and the Soviet Union never got into an all-out nuclear war, and a giant meteor hasn’t smashed into the Earth and ended civilization as we know it in my lifetime, at least.

Maybe the LTCI industry will also muddle through.

Here are some ideas about things that could change and make the LTCI industry be a lot stronger 20 years from now than it is today:

1) Interest rates could go up and stay up. It’s hard to make money when the government rigs the monetary system against you. Sooner or later, rates should go back to normal, and insurance company investment returns should rise.

2) Scientists could find cures for Alzheimer’s disease and other disabling health problems. Just a few weeks ago, scientists announced a discovery about how a protein that may cause or aggravate Alzheimer’s spreads through neurons like mold through a box of raspberries. If scientists can figure out how to use that insight to develop an effective treatment, the reduction in the percentage of LTCI policyholders who have Alzheimer’s could make up for an awful lot of policyholders who cling to their policies more tightly than the actuaries had expected.

3) Boomers could figure out new ways of getting through retirement. Projections of long-term care (LTC) doom are based partly on the idea that boomers will want to live alone either in hard-to-support single-family homes or in hotel-like assisted village facilities until they have to enter nursing homes.

What if boomers use Craigslist and Craigslist equivalents to figure out new ways to get through old age?

What if, say, Susan Boomer gets eight roommates into her suburban McMansion, then installs a couple of the roommates’ unemployed adult children in the attic to keep the incense burning and help the roommates who can’t get around to turn up the volume on the Beatles album so easily? Maybe Susan Boomer could use the GPS devices that Google has implanted in everyone’s ears by that point to make sure residents with dementia don’t get lost.

Or what if long-distance caregiving adult children in New York and Los Angeles start using Craigslist to swap some parental caregiving responsibilities?

4) The boomers might get used to the idea of living in cyberspace. Right now, cyberspace is usually a grainy or cheesy cartoon on a computer screen. But a lot of people already spend much of their time running businesses in cyberspace game universes, earning cyberspace money, and using the cyberspace money to buy and decorate cyberspace houses.

What if cyberspace felt a lot more real, and aging boomers were fine with spending most of their time there?

Maybe, in that future, old old boomers’ real-world living needs would be a lot simpler than they are today. Provide a little food, an alcove with electricity and a good WIFI signal, and — bam! You’d have a happy old old boomer retiree, circa 2050.

5) Maybe today’s young people will grow up to value savings, insurance and security in general more than their elders. The baby boomers came of age in a world where the two most popular visions of the future were of glorious, socialist utopias and of nuclear wars that left the few survivors living in ruins. The idea of saving either for the Star Trek universe or the Mad Max universe seemed somewhat comical.

Today’s children are more like Depression-era children. The children of the 1930s learned the value of scraping the last bit of ketchup out of the ketchup bottle, and of taking free packets of pepper from restaurants to make pepper soup.

The evicted children who are sitting on sidewalks today with the contents of newly foreclosed houses might grow up have a strong interest in products that promote financial security, once they are in a position to buy those products. 


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