Thursday, February 09, 2012

Long Term Care News

As we've mentioned, Ohio requires agents who want to work the Long Term Care insurance (LTCi) market to take biennial "refresher courses" (at 4 hours a pop!) in order to stay up to speed on these products. So yesterday I attended such a class, again provided by my colleague Ray Copenheaver, an acknowledged expert in the field.

I must admit to a bit of trepidation: after all, how much could possibly have changed so much in the past two years to justify 4 long hours of information overload?

Turns out, quite a bit.

We already knew about the recent spate of rate increases, and the exits of several carriers from the market, but that was just the tip of the iceberg. For example, it's (relatively) common knowledge that Unum bailed on the individual marketplace a few years ago, but did you know that they also announced (just a couple of days ago!) that they're also pulling out of the group LTCi business? I sure didn't.

There are also several new developments on the legislative front, such as the PPA (Pension Protection Act). This little beauty, which became the law of the land in 2010, has spawned a raft of new LTCi-enabled annuities, offering a potentially attractive alternative to folks who may not qualify for "regular" long term care plans.

And I learned something new about the Partnership Program. As we've previously reported, Partnership-compliant LTCi policies let one take chunks of assets "off the Medicaid table," protecting them from the dreaded "spend down." But it turns out that that's only half the story: folks who avail themselves of these plans may* also inoculate their estates from Medicaid Recovery efforts. This is a very significant bonus, potentially saving those "left behind" from losing the family homestead.

[*This is not entirely clear - I spent a great deal of time this morning with the Ohio DOI, who could neither conform nor refute this. I'll be speaking with the Medicaid folks shortly to see what they have to say.]

All in all, a very productive 4 hours, indeed.
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