LTC Bullet: What Value Do LTCI Producers Get from the Center for Long-Term Care Reform?

Friday, August 28, 2020


LTC Comment: Why join and support the Center for Long-Term Care Reform? What’s in it for you, after the ***news.***

*** TODAY'S LTC BULLET is sponsored by Claude Thau, who provides many unique services to advisors as National Brokerage Director for USA-BGA and to other entities as a consultant, in the individual, worksite and affinity group markets.  For example, his revolutionary “Range of Exposure” tool projects clients’ likelihood (joint for a couple) of spending $100,000; $250K; $500K or over $1,000,000 on long-term care, based on their personal characteristics and estimates how much of their cost in each range would be covered by various traditional or linked insurance designs.  Claude is the lead author of Milliman’s annual Broker World LTCi Survey & a past Chair of the Center for Long-Term Care Financing. You can reach him at 913-707-8863 or ***

*** HOW AND WHY TO JOIN the Center for Long-Term Care Reform. After you read today’s LTC Bullet I hope and trust you’ll want to get everything the Center has to offer. So check out our “Membership Levels and Benefits” schedule here. That’ll help you decide between the various levels of individual and corporate membership. If you have questions, drop me a note or give me a call at or 425-891-3640. One of the benefits of all Center memberships is anytime access to me for questions about LTC services and financing policy. As I explain in the following Bullet, I like hearing from agents and discussing the challenges you face. It helps keep my policy analysis grounded in your real world of LTCI prospecting, fighting against prospects’ denial, and answering the hard questions people actually ask. So let’s talk. ***

*** “LTC CLIPPINGS” is a special daily service that premium Center members ($250 per year or $21 per month) and above can opt to receive. Steve Moses scans the internet for news, articles, reports and data you need to know before your prospects start asking about them. He provides the date, title, author, a link, a representative quote and a brief, often humorous or satirical, but always thoughtful comment. Know what you need to know before you’re caught off guard. Subscribe to LTC Clippings. ***


LTC Comment: I enjoy speaking to agents about the challenges they face finding and convincing clients to protect themselves against long-term care risk and cost. Agents see the battle for better LTC from the foxholes. As a policy analyst, my perspective often feels high altitude by comparison. Hearing the problems and challenges agents face day in and day out helps ground me in practical ideas and proposals.

So that’s why I jumped at the chance when Center-corporate-member Long Term Care Associates (LTCA) invited me to address their next agent conference call. Special thanks to Stephen, Gary, and Robert Forman and their team for the opportunity to answer the following questions. Here’s what they asked and how I responded.

1. From your vantage, what value proposition from the Center do you think agents should be taking advantage of, which they’ve failed to over the years?

The agent’s role is to educate and sell. To do that well agents need to be on the forefront of professional knowledge and expertise. But how can they do that if they’re also doing all their own research? A critical role of the Center for Long-Term Care Reform is to keep agents apprised of important articles, reports, studies and data they need to know. How often have you been blind-sided by a prospect’s question or criticism that they picked up from a news report that you hadn’t seen or heard yet? Follow the Center and that won’t happen again. The best way to follow the Center is to know our website at inside out.

The website has two levels: One for the general public and one for Members Only. Check out the links at the top of the website to get started.

Here are the items available to all:

Take our virtual tour of the Center's website. (Be patient, it may take some time to load.) This video webinar explains how to access and navigate the valuable content on the CLTCR website. This is the best way to find everything quickly.

The “Moses LTC Blog” includes LTC Bullets and LTC E-Alerts as they’re posted. (To find it, scroll down from the top of

Links to 1286 LTC Bullets newsletters, archived chronologically and by topic covering every aspect of LTC services and financing since 1998

Links to hundreds of articles, speeches, state-level and national reports on every aspect of LTC services and financing

Video of Steve Moses’s 9/21/11congressional testimony on “Examining Abuses of Medicaid Eligibility Rules” (Steve testifies at 18 minutes, 45 seconds into the hearing)

"Clash of the Titans: Moses vs Gordon on Medicaid and other Dark Matter" at the 12th Annual ILTCI Conference. Listen to this riveting debate. (May load slowly)

See a retrospective of the 2008 National LTC Consciousness Tour: LTC Tour Slide Show, pictures of the Silver Bullet of Long-Term Care; history of the year-long tour to raise consciousness about long-term care

Members only website content (available to all on a trial basis for two weeks; use user name: CLTCR2020 and password: FreeTrial):

Aging Demographics
Unfunded Liabilities--Social Security, Medicare, and Budgets
Long-Term Care 
Long-Term Care Financing
Long-Term Care Insurance 
Reverse Mortgages 
Long-Term Care Providers
Medicaid Planning

2. You’ve been instrumental in many major pieces of Medicaid reform legislation: is there anything you or others you know of are currently working towards?

We’ve been on the defense for the past decade. Irresponsible monetary and fiscal policy since the Great Recession have convinced the powers-that-be the country can print and spend unlimited funds without producing new goods and services for people to buy. That’s a recipe for disaster and the catastrophe is baking in the economic oven right now, soon to be served up to the country.

In the meantime, the LTC intelligentsia—analysts and economists who opine about the long-term care problem and what to do about it—have come together in support of a compulsory, public, catastrophic LTC insurance plan based on payroll deductions similar to Social Security and Medicare. Handling LTC in this way won’t work any better than those programs, which are insolvent already and likely to survive only as means-tested welfare programs in the not-very-distant future.

Here’s the good news. Thanks to the dozens of state-level and national studies we’ve conducted and which are available on the Center’s website here, we know what to do and how to do it when policymakers are finally forced by circumstances to do what needs to be done.

What’s that? Redirect Medicaid to the needy and use some of the savings to incentivize responsible LTC planning including private LTCI. Specifically, eliminate Medicaid’s huge home equity exemption, close other eligibility loopholes, and enforce estate recovery. Operate Medicaid as a loan instead of a welfare trap for people with wealth. In time consumers will realize private insurance is a far better option than relying on Medicaid.

3. What’s the single greatest legislative change that could galvanize the private LTCI market?

We need to get the government to stop giving away what you’re trying to sell. Eliminating Medicaid as your primary competition for the business of middle class and affluent people is the one change that could make the biggest difference. Unfortunately, that’s not a very popular idea politically, so it’s not likely to happen until the economy tanks, which it is about to do. When states have to curb Medicaid’s excesses to make budget ends meet, they’ll listen again to what we have to say. That’s how we won in 1993 with the Omnibus Budget Reconciliation Act (OBRA ’93 closed eligibility loopholes and made estate recovery mandatory) and in 2005 with the Deficit Reduction Act (DRA ’05 unleashed LTC Partnerships and placed the first cap ever on Medicaid’s home equity exemption). We’re in a better place now than we have been in over a decade to get the policy changes we need done.

4. In all the state-level reports, data, and studies you read, what have you come across that would surprise our agents—and is there something they could use to advance the importance of LTC planning?

What it’s so hard for agents and everyone else to understand is how easy it is for people to qualify for Medicaid LTC benefits despite having large incomes and assets. I was amazed doing state Medicaid eligibility studies to find that eligibility workers are appalled at how easy it is. They’re angry that lawyers for well-heeled people prepare their perfect applications, sometimes three inches think with documentation. Welfare workers can’t get poor people on Medicaid without devastating the families, but the well-to-do go right on. Adult children have a financial conflict of interest and they’re usually the ones making the decisions once the elders are demented and need care. The system is corrupt and leads to bad consequences as we’re seeing during the pandemic especially, with tragic nursing home deaths and families kept from visiting their institutionalized loved ones.

5. You’ve been even-handed of your criticism of both major parties’ failing to address LTC financing: do you think choice of President or Congress matters much to LTC financing in this country, and if so, does either platform appeal to you more on this basis?

Honestly, no, politics doesn’t matter. Politics is the problem not the solution. Politics is about buying votes by promising people something for nothing. Economics is what matters. Markets fairly distribute goods and services based on merit and hard work instead of political influence and graft. So, no, it makes no difference who controls the government. They’re all prone to irresponsible excess. What matters is what we do when the wages of their irresponsibility come due. Fortunately, we’ve done the prep work to know how to fix long-term care when politics fails and markets matter again.

6. Despite continued efforts to “rebalance” Medicaid towards more home health care, it continues to bias toward nursing homes: how would you communicate this bias—and Medicaid’s other shortcomings—to a client who thinks they can self-insure or “Medicaid Plan”?

The idea that home care costs less than nursing home care is a fallacy. Across society home care delays but does not replace facility care. The two together always end up costing more. Bottom line, Medicaid can’t afford quality institutional care, much less a full continuum of care. Institutional bias is here to stay as the only way Medicaid can keep costs manageable. The public knows nursing homes are undesirable, more so now during the pandemic than ever before. The best way to stay out of a nursing home as long as possible and to access the best ones when necessary is to be able to pay privately for alternative care. The best way to do that is to share the risk and cost through private insurance.

7. Reaction to your message from the carriers sometimes seems tepid: why do you think it’s not been more universally welcomed?

Carriers fear that by exposing the abuse of Medicaid by middle class and affluent people in order to correct it I’m actually disclosing to consumers the secrets of how to dodge private insurance. My dilemma is that I can’t get the problem fixed without exposing and criticizing it. Carriers can be very short-sighted and exceedingly careful. They hear that Medicaid captures most of their potential market and instead of aggressively addressing that problem they too often fear criticism and do nothing. The truth is the only way to fix Medicaid for the poor is to get the non-poor to take responsibility and insure. That’s what I’m advocating.

8. What’s wrong with “selling the Medicaid myth”? (i.e. the notion that you have to spenddown to poverty in order to qualify) The insurance companies, the government, the media, and many agents all repeat this same myth—shouldn’t we?

The Medicaid myth is that you can’t get LTC benefits without spending down into impoverishment. It’s a myth because it isn’t true. If it were true, most people with the financial wherewithal to buy LTCI would own a policy. They’d be scared to death of losing their life’s savings if their life savings really were at risk. You could say the Medicaid myth is a “noble lie.” So if it helps you protect someone with a good policy, so be it. Just know yourself what’s really happening.

What’s really going on is that the public has been anesthetized to LTC risk and cost because Medicaid has picked up most of the catastrophic costs for LTC since 1965. So people don’t worry about LTC until they need it, and once they need it they slip onto Medicaid easily. You’re much better off to acknowledge virtually anyone can get Medicaid to pay for long-term care but to focus on the reasons for not doing that: the problems of access, quality, low reimbursement, institutional bias, discrimination, and loss of independence and control.

Do you say “my clients know about Medicaid’s deficiencies and they don’t want to end up on that welfare program?” If so, you’re missing the point. Nine out of ten potential prospects don’t even contact you or answer your calls. Most people don’t worry about long-term care until it’s too late to plan, save, invest or insure against the risk. That’s true because Medicaid has been the payor of last resort for so long. Undesirable as Medicaid is, it looks pretty tempting when it’s the only thing standing between a family and huge out of pocket costs. Help us remove Medicaid as an easy solution for middle class and affluent people after the insurable event has occurred, and then see how many people are beating down your door to get the LTCI protection they truly need.