Long Term Care Insurance Association Extends Consumer Awareness Campaign

The latest extension of the national campaign to heighten awareness of the importance for long-term care insurance planning focuses on smart and affordable ways to plan in the “new economy”.
          

The special insert appears in the current issue of Kiplinger’s Personal Finance magazine according to Jesse Slome, executive director of the American Association for Long Term CareInsurance responsible for the Fresh Perspectives on Long-Term Care Planning awareness campaign.
          

“We must recognize that we live, work and sell in a new economy and that doing things the same old way simply won’t generate desired results,” declares Slome.  “It is vital to educate consumers that taking advantage of alternate policy design strategies can make this important protection far more affordable than many people think.”
          

One million Americans will see issues of the national personal finance magazine during August and September according to Slome.  “We believe a campaign focused on those individuals who are most likely to actually plan for long term care is a far more effective use of limited dollars,” Slome a leading long term care insurance expert explains.  With support of leading long term care insurers the Association has been placing a series of consumer education inserts into leading publications.  “Each insert has a highly targeted message designed to educate and generate interest in learning more about LTC insurance,” Slome adds.  Reprints of the inserts have been made available by supporting insurers.
          

The current insert suggests consumers consider leaving off traditional inflation protection.  “The old five percent compound inflation standard makes coverage more costly than many are willing to spend,” Slome notes.  “Our belief is that some coverage is always better than none and if selecting a different option or purchasing a higher daily benefit and foregoing inflation protection may make sense for some consumers.”

           

The Association plans to run one additional consumer insert during November’s Long Term Care Awareness month.

New Form Of Long Term Care Insurance Attracting Younger Buyers

The sale of asset-based long-term care insurance protection continued to grow significantly according to research by the American Association for Long-Term Care Insurance the national trade organization.   According to data gathered from leading long term care insurance providers, premium increased nearly 20 percent and the number of covered lives increased 13.5 percent.

           

"We expect the sale of asset based or linked LTC products will continue to grow as they offer some highly attractive benefits to a category of buyers looking to protect their retirement savings," states Jesse Slome, AALTCI's director.  "The growth of sales will only continue as more large players enter the marketplace.”  Pacific Life recently introduced a universal life insurance policy that provides long-term care benefits.
           

According to the Association's annual study of new policy sales, more than half (53%) of male buyers were under age 65.  In the prior year’s study, only 48 percent were under age 65.  The percentage of women buyers under age 65 also increased to 50 percent, up from 44 percent in the prior year.
           

"We are seeing two market conditions fueling growth,” Slome explains.  “Younger buys facing a long time horizon before needing care favor the money-back provision of these policies and older buyers are being priced out of the market for traditional long-term care insurance making this a more attractive option.”   “At a time when long-term care is increasingly top of mind, these life insurance-based solutions avoid the ‘use it or lose it’ risk associated with traditional long term care insurance,” says Chris Coudret, CLU, ChFC, Vice President, OneAmerica one of the nation’s leading insurers offering linked benefit solutions.  “In most cases, people make a single payment, effectively removing the risk of future premium increases.”

           

For 2011, the Association study found that the initial single premium face amount of policies purchased was $100,000 or greater for nearly three-quarters (73%) of new policies.  In addition, the vast majority (96%) of new Life+LTC policies issued did not include a benefit increase option that bumped up available benefits to keep pace with inflationary growth of costs.  By comparison, the Association's study of traditional individual long-term care insurance policy sales, found that in 2011 some 96 percent included a growth option.

           

The complete findings will be published in the Association's 2012 Long-Term Care Insurance Sourcebook.  Founded in 1998, the AALTCI is the national trade organization established to educate both consumers and financial professionals about the importance of long-term care planning.

Younger people are starting long term care insurance planning

A year ago, the majority of individuals who contacted the Association looking for long term care insurance information were age 70 or older.  In fact, we got our share of calls from 80 year olds frustrated that they couldn't find a long-term care insurance company willing to speak with them.  Only a few will and most are understandably highly selective in terms of the risks they will be willing to accept.

Well, slowly I have been witnessing a change.  We started seeing inquiries from more folks in their young 60s and more in their mid to late 50s.  But all of a sudden (meaning the last two or three months) we are fielding calls and questions from consumers in their 40s and even a few in their late 30s.

This is a pretty seismic shift in the world of long term care insurance marketing and certainly will impact how a product is sold.  After all, convincing someone in their late 50s and mid 60s that they need to plan for when they reach the age of 80 is reasonable to accomplish.  For someone who is 40, that is literally an entire lifetime away.

First, what do I think is responsible for what's happening?  To be honest, I hope it is a result of the year-after-year studies published by the American Association for Long-Term Care Insurance that explained the percentage of applicants declined for health reasons and the importance of applying at younger ages when you can still qualify.  It could be that agents have "picked off the low hanging fruit" in terms of marketing to 60 and 70 years olds.  Or, it coule be that younger people are being solicited and a percentage are using Google to find expertise and validate the claims.

What we'll want to see if whether more younger people actually apply and buy.  The year-to-year change in buying ages from 2009 to 2010 was statistically insignificant.

One of the more interesting observations that have caught my attention.

Every Long Term Care Insurance Fact And Figure

​Not a single day goes by without my phone ringing or an email being received from an agent or broker with a question about a ststistic or fact.

And over the years, I have learned to do lots of digging to find those facts and figures that answer threse meaningful questions.  Typically I put the print out from the various reports into a folder knowing that sooner or later I'd need to refer to the report again.

But no longer because we have just released the first Long-Term Care Insurance Almanac that contains all the facts and data one would ever want in one handy, dandy guide.  It's the perfect piece to use yourself or to give to those pesky prospects who ask questions (it will also show them you are a knowledgeable professional ... because no one else will have shared this with them).

We've posted a PDF of the ALMANAC online for you to view.  Go to http://www.aaltci.org/tools and then scroll down towards the bottom.  You'll see the image next to the image of the LTC Insurance Sourcebook.

Milk, Cheese, Dairy Products May Cut Diabetes Risk

Harvard scientists have identified a natural substance in dairy fat that may substantially reduce the risk of type 2 diabetes.

According to the researchers, the compound, trans-palmitoleic (TP) acid, is a fatty acid found in milk, cheese, yogurt, and butter. It is not produced by the body and so only comes from the diet.  Diabetes is an increasingly common condition that can result in disability for older individuals according to the American Association for Long-Term Care Insurance.

A report in the Annals of Internal Medicine explains that TP acid may underlie epidemiological evidence in recent years that diets rich in dairy foods are linked to lower risk of type 2 diabetes and related metabolic abnormalities. Health experts generally advise reducing full-fat dairy products, but TP acid is found in dairy fat.

The researchers examined nearly 4,000 participants and followed them for 20 years in an observational study to evaluate risk factors for cardiovascular diseases in older adults. Metabolic risk factors such as blood glucose and insulin levels, and also levels of circulating blood fatty acids, including trans-palmitoleic acid, were measured using stored blood samples in 1992, and participants were followed for development of type 2 diabetes.

At baseline, higher circulating levels of TP acid were associated with healthier levels of blood cholesterol, inflammatory markers, insulin levels, and insulin sensitivity, after adjustment for other risk factors.

During follow-up exams, individuals with higher circulating levels of trans-palmitoleic acid had a much lower risk of developing diabetes, with about a 60% lower risk among participants in the highest quintile (fifth) of TP acid levels, compared to individuals in the lowest quintile.

Support for the study was provided by the National Heart, Lung, and Blood Institute and National Institute of Diabetes and Digestive and Kidney Diseases of the National Institutes of Health and the National Institutes of Health Office of Dietary Supplements and National Institute of Neurological Disorders and Stroke.

Hospitalized Patients With Sepsis Seniors More Likely To Get Alzheimer's

Older patients hospitalized for severe sepsis are at higher risk for long-term cognitive impairment and physical limitations than those hospitalized for other reasons.

The conclusion was reported following a study by ached by the Department of Preventive Medicine at Stony Brook University Medical Center and reported in the Journal of the American Medical Association.

Sepsis is a condition in which the immune system goes into overdrive releasing chemicals into the blood to combat infection. Sepsis occurs in 1 percent to 2 percent of all hospitalizations in the United States. Sepsis often results after common problems such as pneumonia and urinary tract infections.

Approximately 40 percent of those with severe sepsis die from the condition.  Among surviving patients the researchers found that the odds of acquiring moderate to severe cognitive impairment were 3.3 times higher following an episode of sepsis than for other hospitalizations.

Overall, the study also showed that 60 percent of hospitalizations for severe sepsis were associated with worsened cognitive and physical function among surviving older adults. Severe sepsis also was associated with greater risk for the development of new functional limitations following hospitalization.

Among patients who had no limitations before sepsis, more than 40 percent developed trouble with walking. Nearly 1 in 5 developed new problems with shopping or preparing a meal. Patients often developed new problems with such basic things as bathing and toileting themselves both conditions that result in the need for long-term health care services according to the American Association for Best Long-Term Care Insurance Information (AALTCI) a national trade group.   

Patients in the study had a mean age of nearly 76.9 years. The cohort involved 1,194 individuals with 1,520 hospitalizations for severe sepsis drawn from the Health and Retirement Study, a nationally representative survey of U.S. residents from 1998 to 2006, which collects information on the health, economic, and social factors influencing the health and well-being of Americans over age 50. 

Medicaid's Growth Will Strain States

While the federal government will pay much of the costs related to the Patient Protection and Affordable Care Act (PPACA), states will still find their share unaffordable. 

That's the analysis reported by Devon Herrick, a senior fellow with the National Center for Policy Analysis.

The Patient Protection and Affordable Care Act (PPACA) is expected to add up to 16 million more Medicaid enrollees and will significantly expand eligibility for families with incomes up to 133 percent of the federal poverty level. The PPACA requires states to streamline their enrollment process - making it easier for eligible populations to enroll and retain Medicaid coverage.

Initially, the federal government will pay 100 percent of the cost of the newly eligible, newly enrolled populations and 95 percent of costs through 2019. However, there are hidden costs that will strain state budgets.

According to various estimates, there are 10 million to 13 million uninsured people who are already eligible for Medicaid - but not enrolled. When the individual mandate to obtain health coverage takes effect in 2014, many of the uninsured are likely to be swept up in outreach efforts, Herrick reports.

Although the cost of enrolling newly eligible individuals will be paid by the federal government, the cost of covering those previously eligible for Medicaid must be paid for under the current federal matching formula. Many states will find the cost of their Medicaid programs higher as a result. 

For example, a decade after the PPACA's implementation, Texas Medicaid rolls are predicted by the Texas Department of Health and Human Services to rise by 2.4 million people.  Of these, only 1.5 million enrollees will be newly eligible. About 824,000 individuals will be those previously eligible but not enrolled. The federal government will contribute a much smaller share of the cost of these previously eligible enrollees compared to newly eligible enrollees.

On the average, reimbursements for Medicaid providers are only about 59 percent of what a private insurer would pay for the same service, but it varies from state-to-state.   The reports notes that New York pays primary care physicians only about 29 percent of what private insurers pay for primary care.

Many of the newly insured under Medicaid will likely be those who previously had private coverage. Research dating back to the 1990s consistently confirms that when Medicaid eligibility is expanded, 50 percent to 75 percent of the newly enrolled are those who have dropped private coverage. In addition, a 2007 analysis by MIT economist Jonathan Gruber, found, on average, about 60 percent of newly enrolled children in State Children's Health Insurance Program were previously covered privately. Thus, it is reasonable to conclude that much of the increase in Medicaid rolls will be individuals who were previously privately insured, meaning the number of uninsured will not fall as expected.

"Everyone wants something for nothing forgetting that someone ultimately has to pay the cost," explains Jesse Slome, executive director of the American Association for Long-Term Care Insurance.  "In two decades we will have two classes of citizens.  Those with the means to pay will have choice and control of their care.  Everyone else will depend on whatever taxpayer-paid government programs exist."