Tuesday August 17, 1999
Plan Sponsor magazine's July/August 1999 issue contains an article on the need for and the growth of employer-sponsored long-term care insurance. The article--titled "The Elder-Care Crisis"--is subtitled "With federal programs in distress, escalating long-term health-care costs paint a grim picture for future retirees. What sponsors are doing to help."
Author Fran Denmark writes "If you think your fully funded defined benefit and state-of-the-art defined contribution plans will be adequate resources when the baby boomers hit old age, you might want to think again." Many companies, large and small, she says, are turning to private insurance coverage to mitigate the risk of catastrophic long-term care costs for their future retirees. Interestingly: "Employers offering LTC insurance cite their own reasons--topping the list, usually, is the desire to offer a leading-edge benefit."
The Center for Long-Term Care Financing assisted in preparation of the article, which contained the following quote. "Those who expect they will be able to bequeath assets to their heirs in order to 'impoverish' themselves and become Medicaid-eligible might be disappointed, says Stephen Moses, president of the Center for Long-Term Care Financing, a policy shop in Seattle, Washington. Such asset protection practices are putting the squeeze on a program which is already in distress and is coming under more and more pressure as the population ages, he says. 'For the last 35 years, we've been able to ignore this problem while the government picked up the tab for nursing home care,' says Moses. 'People do not understand that the government will not be able to continue to do so much longer,' he says. 'Folks should be beating a path to the folks who offer this [LTC] product.'" (page 80)
Plan Sponsor magazine is the leading North American monthly
reporting on the pension industry. The publication, with a controlled
circulation of nearly 38,000, is geared to organizations which
sponsor pension plans for their employees. "Plan sponsors"
are the executives charged with providing income and benefits
to retirees through investment. Plan Sponsor's web site is at