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Advisor finds lingering LTC education gap

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The news has been full of stories about insurers leaving the stand-alone long-term care insurance (LTCI) market.

This month, insurers have put their muscle behind promoting hybrid products, or products that help consumers prepare for possible LTC needs by using life insurance policies or annuity contracts that come with features designed to help the holders cover LTC costs.

Melissa Spickler, a wealth management advisor at Merrill Lynch, said her experience is that the supply of LTC planning tools is still much less important in helping consumers prepare than basic LTC education.

“Talk to them early and often,” Spickler said. “It’s about educating the clients for the need.”

Spickler, whose company has access to stand-alone LTC products, hybrid products and other financial services tools and products, said she has the products to help her clients, if only they understand that they need help.

Spickler spoke today at a Web seminar for the media on LTC planning that was organized by Lincoln Financial Group (NYSE:LNC), a major player in the LTC hybrid market.

Spickler said she began to think more about LTC planning after her own mother developed dementia.

Spickler said consumers are starting show awareness of the possibility that they might need care later in life.

“They’re already worried,” Spickler said.

But few consumers who have not been personally involved understand just how much LTC services cost, and few bring up the topic of LTC planning, Spickler said.

“I don’t find my clients are running to me about long-term care,” Spickler said. “I go running to them.”

Spickler explores the possibility of helping to find LTC coverage for clients’ aging parents as well as for the clients. Too often, she said, the clients’ parents already suffer from conditions that make buying LTCI coverage or related products impossible.

Those situations can get the clients more interested in setting up LTC plans for themselves, she said.

Another webinar speaker, Dr. Stephen Holland, chief medical officer at Univita, presented a slide illustrating that how having LTC coverage correlates with where people get care.

Consumers who have LTC coverage and need LTC services may be less likely to end up in a nursing home, according to the data.

About 38 percent of individuals without LTC coverage and need care end up in a nursing home. Twelve percent of the consumers with LTC coverage who need care end up in a nursing home.

The percentage who get care at home is 52 percent for people with no LTC coverage and 65 percent for people with LTC coverage, according to the data.

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