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Life Health > Health Insurance > Health Insurance

LTCI Watch: The need

By Allison Bell

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I’m getting ready to cover the ILTCI Conference next week in Colorado. 

One thought is: I wish I could cover everyone’s conferences. The stars just lined up for this one.

Another thought is: The people who are going the ILTCI Conference are mostly highly positive people, and they’ll mostly talk about what’s going on in the stand-alone long-term care insurance (LTCI) with as positive of an attitude as they can muster, under the circumstances. But the circumstances are challenging, even for highly positive people.

See also: LTCI charges cut life industry earnings

But, on the other hand, I was talking to a friend who’s looking for ideas about a getting second career, and it occurred to me that this must be a fabulous time for someone who doesn’t immediately have to make a living from long-term care (LTC) planning to get into the field.

When the market is shaking, and the issuers are scrambling to come up with new ways to operate, maybe that’s the ideal time to start — especially when there are obvious, easy-to-fix reasons for the current turmoil. Namely, low interest rates and past underwriting mistakes.

What a great time for a cash-rich insurer that doesn’t have to worry about problem blocks of old business to get into the market, call the coverage something else (“estate and lifestyle protection insurance”) and charge sky-high rates without looking like a bandit.

The managers of MNsure, the Patient Protection and Affordable Care Act (PPACA) exchange in Minnesota, gave the idea of LTCI a slobbery kiss last week by wondering if maybe the exchange could help consumers by selling LTCI.

A news article about the proposal made LTC planners laugh and cry, then laugh some more. LTC planners say that the last thing they need at this point is more competition, and that a system that has trouble selling, and explaining, standardized, guaranteed-issue, mostly community-based major medical insurance is going to have some trouble with introducing consumers to private LTCI. 

But I think the real importance of that story is that even people who have only a vague idea of what LTCI is and how the LTCI market works know that consumers need more help with LTC planning.

The details are certainly complicated. It’s hard to know how well any particular product or strategy will work. The challenges facing the stand-alone LTCI issuers may make getting consumers to think about the future even more difficult. But consumers’ need for help with LTC planning is obvious enough for PPACA exchange managers to notice it. That’s pretty obvious.

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