LTC Bullet:  LTC Embed Report from the Policy Front at ILTCI ’14 Orlando

Friday, March 21, 2014


LTC Comment:  ILTCI ’14 in Orlando was another fine conference with record attendance despite downbeat LTCI industry results.  Details after the ***news.***


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LTC Comment:  Damon and I are just back from the 14th Annual Intercompany Long-Term Care Insurance Conference in Orlando, Florida.  Like its predecessors, this year’s meeting, with over 900 attendees including 100 presenters, was another big success.  Incomparable networking opportunities, a large exhibit hall and excellent food and drink (open bars) are typical of this industry meeting.  None of that would be possible without the generous support of many major supporters.  Check out the Diamond, Platinum, Gold and Silver sponsors here.

We asked conference founder Jim Glickman for his highlights of the meeting.  He responded: 

  1. The 14th Annual Intercompany LTCi Conference in Orlando, FL (co-sponsored by the LTC Section of the Society of Actuaries) had over 900 attendees, an all-time record surpassing the 855 attendees in Jacksonville, FL in 2008.  [NB:  the Silver Bullet of Long-Term Care was parked outside the conference venue in Jacksonville as we were well underway with the Center’s 2008 “National Long-Term Care Consciousness Tour.”]

  2. As usual, the largest representation from the 10 tracks (Actuarial, Claims, Compliance, Field Marketing, Group, Home Office Marketing, Management, Operations, Policy and Providers, and Underwriting) was from Field Marketing, followed closely by Actuarial and then Management).

  3. For the first time in several years, there were attendees from multiple insurance companies not currently participating in the LTCi marketplace, together with most of the larger companies, who have at least temporarily, stepped away from issuing new business.

  4. Also in attendance were several reinsurers not currently in the LTCi marketplace together with several representatives of the private equity world, apparently looking for new opportunities to consider.

  5. The two full days and two half days featured over 45 educational sessions, together with more than 20 hours of organized networking.

  6. The Exhibit Hall featured 54 Exhibitors, displaying all the latest innovations for insurance company home offices and their agents.

Next year’s 15th Annual ILTCI Conference will take place March 22-25, 2015 at the beautiful Broadmoor in Colorado Springs, CO.  Conference organizers negotiated a $128 daily room rate!

Saturday, March 15, 2014

Pre-conference activities included Harley Gordon’s CLTC Master Class, always an important contribution to LTCI marketing and professionalism.

Following is a sampling of the conference sessions I attended.

Sunday, March 16, 2014

“Land This Plane” Report:  Ron Hagelman, Roger Loomis and John O’Leary reported on the findings of a “Delphi Study” conducted by the Society of Actuaries’ Long-Term Care Think Tank.  Dubbed the “Land This Plane” project, the research has been underway since January 2013.  A panel of 45 experts answered and defended their responses to numerous questions about how to solve America’s long-term care financing problems.  An executive summary of the project’s final support was distributed in hard copy, but you can read it now here.  The final report should be out within the next couple weeks.  We’ll watch for it and pass on the key findings.  Here are the highlights as reported in Orlando:

*  An overhaul of the LTC system is needed with private insurance involved

*  Government should have a role, but without “filial responsibility” required

*  Social insurance needs to be part of the solution (84% agreed)

        *  Catastrophic  (81%)

        *  Mandatory (78%)

*  Medicaid needs major reform

        *  Tightening eligibility, closing loopholes (81%)

        *  Modernization (86%)

                *  Remove institutional bias

*  NAIC regulations need revision (79%)

*  Marketing and sales improvement (67%)

Monday, March 17, 2014:  St. Patrick’s Day

Opening General Session:  The conference’s opening session featured motivational speaker Chris Gardner whose life story was portrayed in the book and movie “Pursuit of Happyness.”  Gardner’s message was that people always have a choice to make of themselves what they will.  “Spiritual genetics” are more important than biological genetics.  “Never let anyone tell you what you can’t do.”  Just do it.  His humorous, inspirational presentation was a good start for a convocation of shell-shocked, but persevering, LTC insurance experts dedicated to overcoming difficult industry challenges.  More on Chris Gardner and his story here.

Feder and Warshawsky on LTC Financing Policy:  Billed as “an in-depth conversation with two of the nation's most knowledgeable and thoughtful long-term care experts,” this session paired two Harvard PhDs with opposing views both of whom served on last year’s Long-Term Care Commission.  (Read the LTC Commission’s final report to Congress here.)  After John O’Leary’s introduction, the two policy wonks outlined very different perspectives and solutions.  Mark Warshawsky, who co-chaired the LTC Commission, offered a market-based analysis emphasizing the risk that government LTC financing would crowd out family care and private insurance.  Judith Feder took the position that government needs to take an even larger role in financing LTC than it does now.  She proposed a sliding-scale financing approach whereby people with higher lifetime Social Security incomes would have to wait longer than people with lower earnings for government financing of their catastrophic LTC costs to begin.  Presumably, private insurance might be available to cover the front-end cost, sort of like Medicare supplemental coverage.  While the LTC Commission on which both served failed to reach a consensus on the key issue of LTC financing, Warshawsky’s views prevailed in the majority report.  To wit, we should tighten Medicaid LTC eligibility rules, reduce the home equity exemption, and incentivize early and responsible private LTC planning.  (Those ideas should sound familiar to Center members and LTC Bullets readers.)

Short-Term Planning for Long-Term Care:  This session addressed the question “What can you do if you didn’t plan?”  Only 14 people attended, but that was due to a mis-print in the mini-schedule used by most of the conferees which showed the program would be presented a day after it actually look place.  Romeo Raabe, “The Long-Term Care Guy” from Green Bay, Wisconsin, and a Regional Representative of the Center for Long-Term Care Reform, opened the session.  He observed that most agents have gotten this breathless phone call:  “Remember that long-term care insurance you tried to sell me three years ago?  I’m ready.  How fast can you write me?  What?  Oh yeah.  Well it was only a little stroke.”  Romeo described how VA Aid and Attendance benefits can help when private LTC insurance is no longer an option.  He explained and gave examples of how he uses and combines medically underwritten annuities and reverse mortgages to help people generate the extra income they need to purchase LTC services and remain in their homes.  John Zwolanek, an elder law lawyer, discussed how he helps clients without using egregious Medicaid planning gimmicks.  He pooh-poohed the $300-per-hour Medicaid planners who push complex gimmicks like the “reverse half a loaf.”  Finally Bridgett Duber, of Elderlife Financial Services, explained her company’s bridge loan designed to help families span the financial gap between a long-term care crisis and the time when permanent financing can be secured from a reverse mortgage or other source.  Elderlife Financial Services, formally known as “Granny Mae,” was founded and guided for over a decade by Elias Papasavvas, a good friend and long-time supporter of the Center for Long-Term Care.  Slides for this program including Romeo’s case studies and details on Elderlife’s “financial concierge” service are here.

Tuesday, March 18, 2014

Aging and Community Redefined with an Eye Toward the Future:  Beth Ludden of Genworth introduced Dr. Gretchen Alkema, Vice President for Policy and Communications at the SCAN Foundation.  SCAN is 6 years old and addresses the needs of vulnerable older adults.  The foundation focuses on the “macro population level, service delivery and financing,” distributing $6 million per year in grants.  Dr. Alkema offered three take-home messages:  the LTC financing and delivery challenges are not intractable; they involve “people not patients,” and require a strategic framework for a path forward.  LTC financing boils down to “four big buckets”:  (1) front end or (2) back end funding which is public (3) or private (4).  My own take away from this presentation is that SCAN focuses on making LTC service delivery and financing more efficient without first understanding and fixing why long-term care became such a convoluted, dysfunctional mess.  They run the risk of fine tuning a Rube Goldberg machine that may run better but still poorly.  Better to get to the root of the problem first and then address causes, not only symptoms.  Slides for the program are here.

Squaring the Circle: The American LTCI Program: Paul Forte, CEO of the Federal Long-Term Care Insurance Program, presented his recently published version of the proposed “American Long-Term Care Insurance Program.” Forte calls the ALTCIP “A New Public-Private Model for Financing and Delivering Long Term Services and Supports.” Check out his detailed description of the program here and his slides for the conference program here. Like the LTCI program for federal employees and qualified relatives that he runs, the ALTCIP would market directly to consumers but without sales being limited to government workers. Critiquing the Forte proposal were G. Lawrence “Larry” Atkins, Ph.D., Executive Director, Long-Term Quality Alliance and staff director of the Long-Term Care Commission and Stuart Butler, Ph.D., Distinguished Fellow and Director, Center for Policy Innovation, The Heritage Foundation. Both discussants agreed Paul’s proposal is a valuable contribution to the search for a better way to market LTC insurance, although each had his own reservations and recommendations.

Managed Medicaid:  Understanding the Basics from an Industry Leader:  Paula J. Tietjen, Executive Director of Long-Term Care for the United Healthcare Community Plan of Florida, described that state’s ambitious effort to implement a Medicaid managed care program for the frail and infirm elderly.  See details in her slides here.  Combining personal care, case management, participant direction, and rebalancing toward home care, this approach sounds comprehensive and appealing.  But senior advocates worry the end result may be narrow provider networks, quality sacrifices due to cost cutting, and ultimately provider failures.  Still the basic approach is sweeping the country so it bears watching closely.

The Future of the Industry:  This general session, delivered to a packed auditorium, closed the conference.  Its goal was to address the “elephant in the room,” the industry’s challenges, missed assumptions, dismal recent results and uncertain future. 

Marc Cohen of LifePlans painted a picture of the LTCI industry’s current state.  See his slides here.  LIMRA’s recent review showed LTCI sales down 30% last year and minus 8% compounded for the past five years.  Most industry metrics are negative but there are some bright spots, such as “combination products.”  Marc opined that “we need to rethink the structure and distribution of the product, think beyond current LTC Partnership product, and do some unorthodox thinking.” 

Maria Ferrante-Schepis of Maddock Douglas said LTCI may face a “Napster moment,” as when someone who doesn’t belong in your business comes in and reinvents your business.  Citing Apple and Amazon as companies that Napstered several industries, she observed that some companies, such as American Airlines/Travelocity and Disney, have successfully Napstered themselves.  She recommends the latter course for LTCI.  “What if Mark Zuckerberg were to reinvent the insurance industry?,” she mused.  Exciting queries, but no answers except to suggest we all “lean into” the “sharing economy.”  See her slides here

Tom McInerney, CEO of Genworth, observed that “we can’t continue to do what we’re doing.  It doesn’t work.”  He came into the LTCI business with an insurance background and a bias toward following other big carriers out of the market.  But after close review he concluded LTC insurance is viable.  The key is to persuade regulators to allow periodic small premium increases as occur in other lines of insurance.  Everyone needs to recognize that morbidity and service delivery preferences are unpredictable decades in advance.  Aging demographics, the national debt, and huge unfunded entitlement liabilities mean a government takeover of LTC financing is impossible and private insurance is necessary.  See his slides here.

Wednesday, March 19, 2014

Two post-conference programs occurred this day:

Harley Gordon’s Advanced Sales & Marketing Program for CLTC Designated Professionals

“Alzheimer's Disease:  the What, the How and the Hope.”  This two part session included: 

Understanding the Latest In Alzheimer’s Research: Every week there is something in the news about Alzheimer’s research, treatments or prevention. Join Heather Snyder, PhD, Director of Medical and Scientific Relations at the Alzheimer's Association to hear the latest in what is real and promising in the fight against Alzheimer’s. (75 minute session)

Resources and Support for All Stages of the Disease: This session explores the benefits of early detection, how to address a diagnosis of Alzheimer’s disease, stages of the disease and most importantly the various programs and services of the Alzheimer’s Association available to help individuals. Presented by Ruth Drew, Director of Family and Information Services at the Alzheimer's Association. (75 minute session)

I didn’t stay for this program but Center for Long-Term Care Reform Regional Representative Sally Leimbach reports that it was excellent.