“More employers are offering long-term care insurance as a benefit to employees, family members and even retirees,” explains Jesse Slome, executive director of the national producer trade group.  “Conventional wisdom says that group insurance policies cost less than a policy you could purchase on your own but that is not always true for long-term care insurance.” 

According the the Association recommendations, with employer-offered long-term care insurance there are important factors consumers need to evaluate.  “By doing careful comparison shopping, you might find you are able to get equal or even better coverage for less money,” Slome acknowledges.  “A 55-year old couple could pay 25 percent less according to some current analysis.”

Over eight million Americans have long-term care insurance purchased either on an individual basis or through a group plan according to AALTCI’s 2011 Long-Term Care Insurance Sourcebook.  “Employers offering the coverage, typically on a voluntary basis, have been doing great work at expanding awareness for the importance of planning,” Slome adds.  “They are making coverage available to millions and offer coverage to many who might never health qualify for traditional individual long-term care insurance policy.”

As part of the awareness campaign, the Association launched a new online guide for consumers at http://www.aaltci.org/compare.  “We want to encourage anyone who is 50 or older to give serious consideration to planning for the risk of needing long-term care,” Slome concludes.  “If you plan to live a long life, into your 80s, 90s or even longer, you had better have a plan in place.”

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“Costs for health insurance and other employee benefit programs increased dramatically last year so it’s not surprising that employees were older and more cost-conscious when it came to long-term care coverage,” says Jesse Slome, executive director of AALTCI, the long-term care insurance industry organization. 

According to the annual study, over a third (37.2%) of new group buyers were age 55 or older compared to 28 percent for the prior year (2008).   “Younger employees likely decided they could postpone the decision,” Slome suggests.

Nearly half (45.4%) of new enrollees selected daily benefit levels of $149 or less about an eight percent increase compared to the prior year.  “While there was an increase among those selecting less costly options, there was a slight increase in those selecting more costly plans offering daily benefits of $200 or more,” Slome adds.  “In addition, there was a slight increase in the number of new enrollees selecting longer benefit periods, which are more costly.”

According to the Association study, the most common benefit period selected remains five years.  Some 66.1 percent of buyers selected coverage designed to pay benefits for at least five years (up from 61.0% the prior year).  Unlike individual long-term care insurance policies where nearly half  of buyers (64.5%) purchased a five percent annual inflation growth option, only 15,4 percent selected this option with the vast majority (83.6%) selecting an option enabling them to increase benefit levels periodically in future years.  

The Association study also examined new claims beginning during the year.  Some 6.4 percent of new claims were initiated by individuals age 59 or younger.  Only 1.8 percent of claims made against individual LTC insurance policies were by individuals age 59 or less. Nearly half (49%) of benefit dollars paid for new group policy claimants were for home care with only 30 percent for nursing home care.

The complete findings of the survey are contained in the 2010 Long-Term Care Insurance Sourcebook published by the American Association for Long-Term Care Insurance.  For more information visit the organization’s Website:  http://www.aaltci.org/2010sb/.

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analyzed data on 95,000 buyers of employer-sponsored long-term care insurance protection and over 200,000 individual buyers.  Some 8.2 million Americans currently have long-term care insurance protection and about 400,000 new policies or group certificates are issued annually.
“Individuals continue to purchase protection at younger ages but that is especially true for those buying coverage in the workplace,” explains Jesse Slome, the Association’s Executive Director.  In 2008, some 24% of buyers purchasing coverage through an employer-sponsored plan were between ages 35 and 44.  Another 36% were between ages 45 and 54 and 23% were between ages 55 and 64. “Buyers in the group marketplace tend to be younger than those purchasing coverage on an individual basis,” Slome explains.  The Association’s study of individual buyers found that 5% were between 35 and 44, 24% were between 45 and 54 and 53% were between ages 55 and 64.

For the first time, the study examined initial premiums paid by employees purchasing protection under a group plan.  “One of the biggest misperceptions is that long-term care insurance protection is expensive,” Slome explains.  The Association’s study revealed a significant spread between the low and high amounts paid per-employee.  “For example, for those between ages 45 and 55, the low premium was $430-per-year while the high premium was $985.”  The average for this age band was $690.
The study also looked at claims being paid to those covered by an employer-sponsored long-term care insurance coverage.  “Because many employer-sponsored plans offer some form of simplified underwriting or even guaranteed issue, we expected to find more people qualifying for benefits at younger ages,” Slome notes.  Indeed, the Association’s research found that 13 percent of new claims opened during 2008 were for individuals less than age 60.  “Some 11.5 percent of new group LTC claimants file their claim during the fourth or fifth year of their coverage.”  The largest open claim under a group plan exceeds $490,000 and the individual has been on claim for over nine years.

The complete findings of the study are published in the 2009 LTCi Sourcebook available from the American Association for Long-Term Care Insurance (http://www.aaltci.org/).  For additional information on ordering the 2009 Sourcebook, call the Association’s offices at (818) 597-3227 or visit the organization’s website: http://www.aaltci.org/sb2009.

Summarized Study Data For 2008
Please credit:  2009 LTCi Sourcebook, American Association for Long-Term Care Insurance

Age of Buyers       Group LTCi       Individual LTCi
Under 45                       36%                                7%
45 to 54                         36%                               24%
55 to 64                         23%                               53%
65 and Over                 5%                                 16%

Daily Benefit              Group LTCi          Individual LTCi
Less than $100                           9.0%                              6.5%
$100 to $149                            33.0%                            31.5%
$150 to $199                              25%                               35%
$200 and Over                          33%                               27%

Premium Paid (Group Long-Term Care Insurance) 2008
Age                   Low             High              Average

35 – 44                   $230                   $650                   $435
45 – 54                   $430                   $985                   $690

55 – 64                   $750                   $1,400                $1,120
65 and Over        $1,520               $2,535                 $1,925

New Claims          Group LTCi        Individual LTCi
Under 50                       3%                                 0.4%
50 to 59                         10%                               1.5%
60 to 69                         22%                               7.0%
70 to 79                         33%                               30.5%

Age 80 and over         32%                             60.6%

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