Long-term care insurance (LTCI) carriers and marketers may be doing pretty well from the perspective of someone who tries to look at the market from a long-term perspective.
The Employee Benefit Research Institute (EBRI), Washington, has publishing a shocking report showing that private LTCI — a product often dismissed as niche product, possibly akin to alien abduction insurance — was covering about 14% of new U.S. nursing home entrants in 2010, up from 6.4% in 2000.
About 13% of the home care users had private LTCI.
There were about two new nursing home users with Medicaid for every one new user with private LTCI, but that ratio is down from about five to one in 2000.
Sudipto Banerjee, an EBRI researcher, came up with those figures using data from the Health and Retirement Study, a series of surveys conducted by researchers at the University of Michigan.
As Jesse Slome of the American Association for Long-Term Care Insurance (AALTCI), Westlake Village, Calif., often points out, LTCI is a specialty product. To make much use of it, clients have to have enough spare income to pay for the coverage, be healthy enough to qualify to buy coverage, and be non-wealthy enough, or enthusiastic enough about the concept of using insurance to minimize risk, to consider using LTCI to pay for LTC rather than relying on their savings.
The clients also need to be realistic enough to have at least a little of an inkling that bad things could happen to them, too.