LTC Bullet:  LTC Grab Bag 

Tuesday, June 27, 2006


LTC Comment:  Today's LTC Bullet ties up some loose ends with reader's comments on recent Bullets.  After the ***news.*** 

*** TODAY'S LTC BULLET is sponsored by Claude Thau, a Master General Agent who helps LTCi producers nationwide.  Claude is the lead author of Tillinghast Broker World Individual and Group LTCi Surveys.  His mentoring skills help you build whichever market suits you best (individuals, executive carve-out, multi-life, affinity, financial institutions, referrals from other professionals, etc.).  As a Long-Term Care Partnership-promoter in many capacities, Claude may be able to help your state implement a Partnership effectively.  Test Claude by calling 800-999-3026, x2241 to discuss opportunities or email . *** 

*** THE NATIONAL LTCI PRODUCERS SUMMIT, organized by the American Association for Long-Term Care Insurance (AALTCI), will be held November 5-7, 2006 in Austin, Texas.  The complete Summit program is now posted on the AALTCI Website (click here:  Special discounts are still available for first-time attendees.  Steve Moses says "I'll be there to speak about the Brave New World of Long-Term Care since the Deficit Reduction Act of 2005." *** 

*** STEVE MOSES will be in the Washington, DC area from Monday, July 10 to Thursday, July 13.  If you can schedule Steve to speak to your group in MD, VA, or DC during that period, the Center for Long-Term Care Reform will discount the cost of the program to $1,000 from the usual $5,000 flat fee.  Ask about our "Brave New World of LTC" educational/motivational program covering why the Deficit Reduction Act should wake up the public to the need for long-term care planning.  Contact Steve Moses directly at 206-283-7036 or *** 

*** SPEAKING OF THE DRA, we received this note from Center supporter and LTCi producer Teresa Eagan of Long-Term Care Associates ( in Indianapolis, IN:  "Since the DRA was signed, we have been contacted by a few elderlaw attorneys who have now purchased LTC insurance for themselves (and their spouses) and who say they are planning to actively recommend the purchase of LTCI to their clients.  We even have one attorneys' office (husband & wife) who have inquired about becoming LTCI agents.  So, maybe we're winning some battles!"  Hear, hear! *** 



LTC Comment:  Our LTC Bullets titled "LTC Contradictions" and "LTCI Contradictions Resolved?" (check them out on the LTC Blog at or in The Zone) elicited this comment from Jennifer Douglas of LIMRA International. 


I enjoyed reading the results of [the Center's] recent poll that compared LIMRA's Individual Long-Term Care Insurance Sales survey with Claritas' survey of Americans regarding LTCI ownership.  Although I found your readers' responses very interesting, I don't necessarily agree with the premise that our results "contradict" each other.  In fact, LIMRA consumer research has also found that an inordinate number of Americans believe they are "insured" for the LTC risk.  For example, in a 2001 LIMRA survey of Americans, 25 percent of retirees and 20 percent of pre-retirees said they own LTCI.  As you know, there is much confusion among consumers about what Medicare will pay for and many have an entitlement mentality when it comes to social programs.  This speaks to what a LIMRA member has identified as LTC insurers' biggest competition, not each other, but Americans "ignorance, apathy, and denial."  

LIMRA's collection of sales data (individual and group) are insurer reported.  Our studies are perceived to be the closest the industry has to empirical data on the sale of LTCI in the U.S. in a timely manner.  As with all LIMRA benchmarking studies, the LTCI sales surveys are for the benefit of LIMRA members.  To that avail, "telling it like it is" by reporting good and/or bad news is the value LIMRA provides our membership.  Furthermore, members can be assured that the integrity of the data is taken very seriously as is our analysis.  As such, LIMRA will not imply that industry sales are up when the data proves otherwise.  Nor will we embellish the implication of individual carrier growth if evidence suggests that the growth is not organic or is simply due to the fact that a carrier had poor sales the prior year or is a recent entrant with a small base. 

First and foremost, LIMRA members want to know if industry sales are "up or down."  In this case, it seems only appropriate that the elephant, the fact that the negative sales trend for individual LTCI continued through first quarter 2006, be the first item addressed in the individual LTCI summary report.  However, when our summary report came across your desk, I hope you had an opportunity to read the entire report.  [We did not.]  It seems a bit ironic that the tone of this report is being questioned [by one commenter], while in the very same report, I encouraged my audience of insurers to focus on delivering its own message of positive news about our industry.  

"...With all the coming chatter certain to reach more Americans than ever before, the industry's voice must influence consumers and the media not with the industry's past, but with both the emotional and financial impact of receiving benefits from LTCI coverage. That's a powerful message."  

As one of your readers noted, we have seen growth in the group LTCI market, which represented 18 percent of new LTCI premium in 2005.  LIMRA's Group Long-Term Care Insurance Sales survey reported that the compound annual growth rate for employer-sponsored sales was 17 percent for the 10-year period from 1995 to 2005.  And, although there are fewer Americans buying LTCI in recent years overall, LIMRA agrees that the number who own LTCI is indeed growing.  As LTCI is a relatively young product, coupled with its high persistency, the number of policies in force has increased each year despite a negative trend in individual sales.  

While our sales surveys report on the recent past, other LIMRA research looks ahead.  In fact, we're currently surveying individuals in the LTCI industry about their outlook and predictions for the future of LTCI.  This will provide us with a good sense of what the industry believes the future has in store for LTCI.  

Thanks again for giving me this opportunity to respond. 


LTC Comment:  Likewise, Martin McBirney's LTC Bullet article last week titled "LTCI:  A Different Approach" elicited some interesting replies.  (Center members with access to The Zone can read McBirney's article at  For example: 



No more people will buy this guy's "product" than are buying today's.  Fewer in fact as I think it smacks of gatekeepers and limited benefits.  

Today's sluggish sales rate is not a "product" problem.  It's a planning problem.  Or said another way, we've failed by focusing on product instead of planning. 

As you've [i.e., the Center for Long-Term Care Reform] long argued, real income, assets and lifestyle must be at risk before American's will take the required personal responsibility.  We're moving that way legislatively, but it's not a quick fix. 

Frankly, today's products are not the problem.  And I'm so sick of the "complexity" complaint.  At its core today's LTCi product is amazingly simple and identical to all other forms of risk insurance:  You get money when something happens. 

LTCi will NEVER be simplified.  It can't be done beyond a certain point.  (Mr. McBirney's idea actually seems more complicated.)  It is a complex, multi-faceted risk and claim where the policies must be nimble enough to cover a broad continuum of care.  The BEST simplification which is already in the market is cash benefit indemnity that simply pays the benefit once you need care.  No receipts, no definition of provider or limitations as to who, where or how often.  But this flexibility/simplicity comes at a price. 

Too few advisors are selling the problem and the consequences to people BEFORE they recognize the need.  (That's called "selling.")  Helping people buy a product after they've had negative medical reports or have just put mom in a nursing home is not selling, it's taking orders.  Those low-hanging apples have been picked.  We actually now have to get out the ladder, carry it to the orchard, put it up in the tree and climb. 

You know, some LTCi training programs encourage agents to ignore people who've never had personal experience with LTC because "it's too hard a sale."  So I guess that means we should not advise a 45-year-old to start saving aggressively for a 30-year retirement if no one in his family has ever lived beyond 70?  Should we bother selling life insurance to 30-something parents who've never had experience with a person who died young? 

The issue is the real advisors, those that a majority of Americans listen to - the great life agents, P&C agents, financial planners, CPAs and attorneys - are not only not recommending LTCi, they are not even addressing the risk of care and the need to develop a plan for care integrated with other retirement and estate plans and the resources needed to pay for care. 

Heck, I don't care if they don't like LTCi or ever recommend it.  But they're also not addressing what's at risk either.  Once you understand the risk and consequences to a financial portfolio and a family's lifestyle you have to take some planning action.  This is how LTCi should (and will be) sold. 

By the way, this is how life insurance, retirement and estate plans are sold. 

And am I to believe that LTCi is more complex than managing a broadly diversified portfolio of stocks, bonds, mutual funds etc.?  Is it more complex than an estate plan that includes charitable remainder trusts, life estates, irrevocable life insurance trusts, special needs trusts, etc.? 

Thanks for keeping the dialog fresh, active and engaging. 

Bill Comfort, CSA, CLTC, Comfort Assurance Group, St. Louis, MO 


I enjoyed [Martin McBirney's] piece in the LTC Bullet.  On the first part, one might say the [LTCI] industry has been attempting to purvey soy burger by selling the sizzle not the steak, and now that the sizzle (bells & whistles) has lost its savor, consumers are asking "where's the beef?" 

On the second part, it strikes me that one of the challenges to the implementation of a preventive, disease management model is the bifurcation of care between acute healthcare and long term care.  Medical "treatment" coverage has been the province of traditional health insurance and Medicare (or Medicaid).  With the exception of rehabilitation, LTC is focused on addressing the disabling consequences of medical conditions; that is, it focuses on dealing with the results more than the cause.  Even in [McBirney's] example of ADRD [Alzheimer's Disease and Related Disorders], where the line might be most blurred, doctor visits, diagnosis, . . . and treatment, say with prescription medication, would generally be in the current reimbursement province of the health insurance companies.  If LTC insurers begin to cover these things, do they become health insurers in the eyes of the regulators?  What about potential double billing or duplicating coverage (a big no-no for seniors)?  The intrusion into traditional health insurance is even greater for preventive or remedial actions for stroke and peripheral arterial disease, and now there is new technology coming on line which could revolutionize the treatment of osteoarthritis. 

Then there is the generalized industry aversion to really providing much in the way of coverage for "preventive" care.  The concern seems to be about paying for "preventive" interventions when that which is being "prevented" might not have happened anyway.  And what is included in the definition of "prevention?"  It seems to me that even HMOs, whose very name betrays their originating concept of health "maintenance," including prevention, today tend to provide very restricted benefits for wellness checks or preventive care. 

This would take a cosmic realignment of regulators, legislators, Medicare and the broad healthcare insurance industry. (Which is not to say it shouldn't be done, just that a lot of vested and special interests are involved which will make it difficult at the very least.) 

Could it be that the remaining LTCI players are gambling (shrewdly or foolishly) that the more involved consumers you reference will seek out and take advantage of emerging preventive treatment options on their own time and own dime, allowing the insurers to receive the windfall that such actions will provide as claims are delayed or eliminated? 

As always, [McBirney is] articulate and thought provoking . . .. 

Dale Larson, former president of LTC, Inc. and the Larson Long-Term Care Group, Woodinville, WA