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LTCI Watch: Watch

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One thing that happened this week: My daughter turned 11 Wednesday. She asked for one of her birthday presents to be a watch, so, of course, she got a watch.

She could use her watch on her birthday evening to see whether the Senate and the House were going to work out some kind of budget and debt ceiling in time to (as far as I know) save civilization as we know it by midnight.

Another thing that happened: Various insurance marketing people pitched me ideas for stories about long-term care insurance (LTCI), and long-term disability (LTD) insurance, and retirement planning. And, meanwhile, I was looking at a Moody’s Investors Service commentary about how terrible it is for an insurer to have “long-tailed liabilities” — that’s LTCI, LTD insurance, and just about any other major product other than acute care health insurance.

The third thing that happened was that, of course, the House, the Senate and President Obama somehow cobbled together some kind of Frankenstein’s monster government, dollar and civilization rescue bill based partly on a requirement that the U.S. Department of Health and Human Services make us prove that we’re broke before we get any health insurance subsidies.

Securities analysts and international dollar watchers are giving the deal bad reviews, and they should. The Republicans and the Democrats have behaved like troubled parents who live in a high-rise and swing their baby over the balcony night after night. When the police come, the parents somehow manage to keep the baby by saying, “Hey, we’re just arguing. We never actually drop the baby.” 

Marketers of LTCI and other products that create long-tailed liabilities have to market, but, right now, it feels as if they’re going through a show of making it look as if the insurers want to write coverage, so that the insurers can sell enough policies to hang on until conditions improve and they actually want to sell policies. 

It’s very easy to blame the Republicans for the latest shutdown crisis, given that they bragged about wanting to shut the government down, but, of course, the Democrats contributed to the mess, too, by shutting Republicans out of any of the health reform talks that mattered from 2008 to 2010, and by pretending that the effort to reform Medicare and Social Security spending is a cold-hearted, right-wing plot to kill grandma.

The Tea Party should not have tried to shut the government down this week, but Democrats should not be promising to pay the same dollar to eight different people in 2050.

Government involvement in health care may not always work, but it’s not necessarily a pure incarnation of communism.

Ensuring that the government actually has some practical ability to live up to whatever benefits promises it makes, and doesn’t just make the promises because doing otherwise would lead to some extremely sad stories, is not a pure incarnation of fascism.

Maybe what would help is if ordinary people who want members of Congress to think about the distant future (say, three years from now) would move the conversation away from tea parties, and, instead, send policymakers broken dollar-store watches, to convey the idea, “It’s later than you think.”

Until policymakers in Washington get that message, and come up with a way to run the country in a way that suggests that they believe the country has a future, insurers will have a hard time making much of a sincere effort to write products that are supposed to pay off in that supposed future.

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