Hot Tip and Best Practice
Thursday August 17, 2000
Center for Long-Term Care Financing President Steve Moses will engage elder law attorney Harley Gordon in a lunch time discussion on Sept. 13, 2000 at the LIMRA DI and LTC Insurer's Forum in Boston. LIMRA is the Life Insurance Marketing and Research Association. The Insurer's Forum is a popular annual conference targeted toward insurance executives responsible for individual DI & LTC products, sales, distribution, claims, underwriting, and administration. For details on the event including registration information, go to: http://www.limra.com/events/EventDetail.asp?ID=38
We often extol in this space the social benefits of paying privately for long-term care. The more people who buy private long-term care insurance, for example, the less will be the strain on Medicaid to provide care for the needy. Thus, private long-term care insurance not only helps prosperous people who can afford it, but also benefits those dependent on public financing who are unable to pay for private coverage.
The challenge remains, however: how do you get people to buy long-term care insurance well in advance of the need--even when they can afford it--if the government is giving away coverage, such as it is, after the insurable event has occurred?
One way is to disclose Medicaid's serious deficiencies with regard to access, quality, reimbursement, discrimination and institutional bias to the long-term care insurance prospect. But even if you are careful and accurate, that approach may lead to accusations that you are employing "scare tactics."
In "Broker World's" August 2000 issue, author Phillip
C. Gallant ("The Three 'Whys' of Long Term Care
Insurance," pps. 66-74) suggests another promising
"Reviewing the rules for qualification for medical assistance under Medicaid, I . . . show [prospects] a list of all of the documents required by Medicaid to apply for assistance, as well as the certification statement, which must be signed.
"'Mr. and Mrs. Prospect, is this what you want to do if you need care? Because it is an option that you have.' The answer is usually an emphatic NO! I remind them that any form of long term care planning which would create the opportunity to qualify for Medicaid would lead them to have to sign this form. That is usually the end of the Medicaid planning discussion." (p. 72)
Most state Medicaid nursing home eligibility applications are long, complicated documents. They require proof of every aspect of an applicant's financial and medical condition. Published rules and regulations governing eligibility often run on for hundreds of pages. The eligibility process itself usually involves a face-to-face visit with a welfare worker, often in an unpleasant setting. Most people who can afford long-term care insurance or can otherwise plan to pay privately for their care would not expose themselves or their loved ones to such degrading prospects if they knew what to expect.
Medicaid planning attorneys are not likely to disclose these facts. Responsible advisors can and should.