The data comes from the 2011 Long-Term Care Insurance Price Index published by the American Association for Long-Term Care Insurance <a href> http://www.aaltci.org </a>that analyzed rates for 11 long-term care insurance policies.   According to the Association report, a 55-year old single individual pays $1,480 annually for comparable coverage.   If the 55-year-old couple did not qualify for preferred health discounts, their cost would increase by $325 annually.

“We significantly expanded this year’s survey to include more relevant scenarios for both couples and individuals at varying ages, health conditions and to take into account the significant spread in costs among insurers for virtually identical coverage,” explains Jesse Slome, executive director of the long-term care insurance industry trade organization.  The study found that rates for comparable coverage from leading insurers could vary by between 41-to-48 percent.

According to Association research, three-fourths (78%) of long-term care insurance policies are purchased by couples where either both or just one spouse purchases coverage.  The average age for individual purchasers is 57, Slome explains with some 76.3 percent of purchases made between ages 45 and 64 according to the Association’s research.  The 2011 Price Index analyzed costs for couples at ages 55, 60 and 65.

The study reported rates for individuals who qualify for good-health discounts as well as those who qualify for standard rates as a result of having one or more health issues.  In addition, for the first time, the analysis included a three percent compound inflation growth factor versus the five percent formula that has been used in prior studies.  “More purchasers are opting for this formula which significantly reduces the cost of coverage and can be quite adequate in terms of future benefits,” Slome explains.  The Price Index also looked at rates for policies including the newer Shared Care option whereby two policyholders can each access a combined pool of benefits.

“The shared care option is now highly attractive to couples,” states Larry Moore, Director of Marketing for American Independent Marketing, a leading national marketer.  “The ability to purchase a more affordable shorter duration policy but have access to a much larger combined pool of dollars is easy to explain and of great value to the buyer.”

Including the ‘Shared Care’ option, a 65 year old couple with average (standard) health can expect to pay $4,660-per-year (combined) for about $338,000 of current combined benefits which will grow to about $527,000 of coverage at age 80.  “To best educate consumers, the Price Index reports average rates individuals can obtain from leading insurers,” Slome explains.  “However, for this same level of protection, a 65-year old couple could pay as much as $7,200 a year.”

The complete Price Index will be published in the Association’s 2011 Long-Term Care Insurance.  For more information, visit the American Association for Long-Term Care Insurance’s website at www.aaltci.org.

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Researchers had identified a variant of the gene for cholesterol ester transfer protein (CETP) — involved in carrying cholesterol in the bloodstream — as being associated with a longer life span. They note that the longer you live, the more common is the favorable variant.  The incidence is 5 percent at age 50 and 35 percent at age 95. 

The new study followed over 500 people, all age 70 or older, for four years, testing their mental function and relating it to the variant of the CETP gene they carried.  Participants who carried two copies of the variant gene experienced an age-related decline in mental function that was about half as rapid as people with two normal versions of the gene, the study found. 

Individuals with two copies of the favorable CETP variant also had a reduced risk of developing Alzheimer’s disease compared to those with two normal versions of the gene, the study found.  Researchers note that the gene is a a great candidate for further research on Alzheimer’s disease and dementia. 

According to the researchers, the CETP gene variant was first identified in a population of Ashkenazi Jews, descendents of western and central Europeans. The current study was done among an ethnically diverse population of people living in the Bronx who have been followed for 25 years.

 The findings were reported in the Jan. 13 issue of the Journal of the American Medical Association. 

Reported by the American Association for Long-Term Care Insurance, the national trade organization that tracks news related to long term health care issues.

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The study measured costs for top selling long-term care insurance policies that provided approximately $115,000 in current benefits, with protection increasing yearly as the individual ages. “A solid base plan of protection will grow in value to over $305,000 of protection 20 years from now,” explains Jesse Slome, executive director of the national trade organization that conducted the annual study.

For some age bands the cost of long-term care insurance experienced a modest one percent decline compared to the prior year, the study found. “What we did see is a far wider range of prices between insurers offering basically the same coverage,” Slome notes. According to the study, costs can vary by as much as 60 percent from one insurer to the next. Experts advise consumers to compare policies or work with a knowledgeable insurance professional with access to multiple insurers who can help you get the most benefit for the lowest cost.

“The cost of long-term care insurance is directly related to how much protection you purchase, the age you first apply, your health at the time of application and assumptions that vary from one insurer to another,” explains Slome. According to the Association, over half of all individual applicants are between ages 55 and 64, and one third purchase a daily benefit of between $100 and $149. Most opt for an optional inflation growth rider that increases the potential pool of available benefit dollars each year.

The cost analysis priced typical coverage for individuals ages 55 and 65. The study reports that a married individual age 55 purchasing $172,000 in current protection will pay about $20-a-week ($1,084-per-year) by qualifying for available good health discounts. By waiting until they are age 65, they’ll likely pay $63-a-week ($3,275-per-year) because costs increase with age and one must buy more coverage to keep pace with inflation the report concludes.

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A 55-year-old individual considering long-term care insurance protection can expect to pay $709-per-year for a base level of protection if they are married or $1,095 if they are single according to the 2008 Long-Term Care Insurance Price Index published by the American Association for Long-Term Care Insurance (www.AALTCI.org). Costs for coverage increased about four percent from the prior year.

The annual index measures current costs for top-selling long-term care insurance policies that offer consumers approximately $115,000 in current benefits (base-level coverage), with protection increasing yearly as the individual ages. “That coverage will grow in value to over $305,000 of protection in 20 years,” explains Jesse Slome, Executive Director of the national trade organization that conducted the research. The study compares costs for plans that provide benefits for 3-years or longer with an annual compound inflation option that increases the available insurance benefits by five percent compounded each year.

“Policy costs increased slightly compared to the prior year according to the study. “The cost of long-term care insurance is directly linked to interest rates, the anticipated likelihood of claims as well as care costs,” Slome explains. “When interest rates decline as they have in recent years, insurers need to increase premium costs. And as our society ages, more people will be needing long-term care that becomes more costly each year.”

“People often ask what is the best age to buy long-term care insurance protection and the honest answer a month or two before a change in your health,” Slome explains. “But since no one can predict when that’s going to happen, we try to show people the benefits of planning early, generally in their mid-50s is a good recommendation.”

Another Association study of leading insurers which issued 250,000 individual long-term care insurance policies in 2007 revealed that significantly more individual applicants in their 50s qualify for preferred health discounts than those who wait until their 60s to apply (51.5 % versus 42.2% ). “It’s never an economic advantage to wait,” Slome says. “Costs do increase from year-to-year and that change in your health could make it impossible to health-qualify no matter how much you are willing to pay. Plus, you are not protected during the years you delay.”

While most people will derive benefit from their long-term care insurance at older ages, some require care in their 50s and 60s as a result of accidents or early-onset illnesses such as Multiple Sclerosis and Parkinson’s. “Some 12.5 percent of new claims filed in 2007 start before the individual turned 70,” Slome adds. “As the adage goes, a failure to plan is a plan for failure.”

2008 National Long-Term Care Insurance Price Index

A national study of average policy prices providing specified benefits.

Age 55 – $709-per-year ($100 Daily Benefit x 3 Year BP, individual qualifies for preferred health and spousal discounts

Age 55 – $1,064-per-year ($150 Daily Benefit x 3 Year BP, individual qualifies for preferred health and spousal discounts

Age 65 – $1,342-per-year ($100 Daily Benefit x 3 Year BP, individual qualifies for standard health and spousal discounts

Age 65 – $2,998-per-year ($150 Daily Benefit x 3 Year BP, individual is single (standard health)

Age 65 – $4,729-per-year ($240 Daily Benefit x 3 Year BP, individual is single (standard health)

Rates compiled by LTCI Partners LLC, Chicago, IL. Based on 3-year plan, 100% home care, 5% compound growth of benerfits.

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A 65-year-old purchasing comparable coverage will pay $1,292 (married) or $1,923 (single) according to the 2007 Long-Term Care Insurance Price Index published by the American Association for Long-Term Care Insurance.  Costs are roughly the same as the prior year.

The annual index measures current costs for top-selling long-term care insurance policies that offer the ability to receive care either at home or in a skilled care facility.  “During the past year, a number of new policies have grown in popularity, some of which provide more affordable coverage especially for younger individuals who qualify for discounts offered to those in good health as well as individuals who are married or residing with a partner,” explains Jesse Slome, Executive Director of the national trade organization that conducted the research.

“Consumers mistakenly believe long-term care insurance protection is costly and nothing is farther from the truth,” Slome explains.  “There are discounts available today to those in good health, for non-smokers, married couples or even domestic partners,” Slome notes.  “You can cut costs paying annually versus monthly, roughly nine percent, and by another eight percent simply by being accepted for coverage before your next birthday.”

The Association’s study compares costs for plans that provide benefits for 3-years, which increasingly is accepted by industry experts as a basic level of protection for many.  “With more people in their 50s purchasing protection, growth options that increase the value of benefits available to keep pace with rising costs of care is important,” Slome advises.  The study priced plans that provide $110,000 or $172,000 in current protection ($100/day and $150/day for 3 years) for someone age 55.   “Benefits increase at five percent compounded annually so the actual benefit by the time an individual reaches 80 would grow to $390,000 or $585,000 respectively,” explains Slome.

Study Demonstrates Savings Benefits Of Planning Early

“I’m often asked the best time to buy long-term care insurance and the honest answer is the day before a change in your health,” Slome says.  “But since no one can predict when that’s going to happen, we try to show people the benefits of planning early, generally in their mid-50s is a good recommendation.”

“Our studies show that more applicants in their 50s qualify for preferred health discounts than those who wait until their 60s to apply (44 % versus 32% ²),” Slome notes.  Using the Association’s example, an individual age 55 considering a policy that currently provides $150-per-day benefit might expect to pay $1,027 (assumes they qualify for spousal and preferred health discounts).  If they wait 10 years, until age 65, to buy the same $150-per-day coverage but no longer qualified for the good health savings, they would pay $1,939 yearly.  “That assumes insurance prices don’t increase over the decade they waited,” Slome adds, “and most likely they will.”

“But, 10 years from now you will actually need to buy a higher benefit amount to keep pace with inflation,” Slome states.  In 10 years, at five percent annual growth, one will need to buy a  $240 daily to be equal with today’s $150-per-day benefit.  The Association’s 2007 Price Index reveals the average cost for $240-per-day benefit will range from $3272 to $4,823.  “It’s never an economic advantage to wait,” Slome says.  “And, more important, a change in your health could make it impossible to health-qualify no matter how much you are willing to pay.”

“People, especially in their 50s, fear they’ll make the mistake of paying for something they’ll never use,” Slome acknowledges.  “Would you rather make the mistake of not having some basic level of protection considering the enormous risk to your retirement savings and family?”

# # #

Compound Inflation Growth Table
Impact of 5% Annual Increases

Age 55   $100   $150
Age 65   $163   $244
Age 75   $265   $398
Age 80   $339   $508

¹ Rate based on $100-per-day (current) benefit; 3-year plan; 100% home and skilled care; 5% compound growth of benefits.  Individual qualifies for preferred health and spousal discounts.

² Source:  American Association for Long-Term Care Insurance Study; Feb. 2006

2007 Premium survey rates provided by LTCI Partners, LLC, Chicago, IL.

2007 National Long-Term Care Insurance Price Index
Source:  American Association for Long-Term Care Insurance
Published June 1, 2007

Average price for a comprehensive long-term care insurance policy (100% home care benefit + skilled care coverage), 90-Day Elimination Period with Compound Inflation Protection Option (benefit increases 5% compounded annually)

Age 55 $100 Maximum Daily Benefit x 3 Year Benefit Period
Cost:   $ 665-per-year Individual Qualifies for Preferred Health and Spousal/Partner Discounts

Age 55 $100 Maximum Daily Benefit x 3 Year Benefit Period
Cost:   $1,075-per-year     Individual Qualifies for Preferred Health

Age 55 $150 Maximum Daily Benefit x 3 Year Benefit Period
Cost:   $1,027-per-year     Individual Qualifies for Preferred Health and Spousal Discounts

Age 55 $150 Maximum Daily Benefit x 3 Year Benefit Period
Cost:   $1,524-per-year     Individual Qualifies for Preferred Health

Age 65 $100 Maximum Daily Benefit x 3 Year Benefit Period
Cost:   $1,292-per-year Individual Qualifies for Spousal/Partner Discounts  (Standard health)

Age 65 $100 Maximum Daily Benefit x 3 Year Benefit Period
Cost:   $1,923-per-year     Individual is single (standard health)

Age 65 $150 Maximum Daily Benefit x 3 Year Benefit Period
Cost:   $1,939-per-year     Individual Qualifies for Spousal Discounts  (Standard health)

Age 65 $150 Maximum Daily Benefit x 3 Year Benefit Period
Cost:   $2,885-per-year     Individual is single (standard health)

Age 65 $240 Maximum Daily Benefit x 3 Year Benefit Period
Cost:   $3,272-per-year Individual Qualifies for Spousal/Partner Discounts  (Standard health)

Age 65 $240 Maximum Daily Benefit x 3 Year Benefit Period
Cost:   $4,823-per-year     Individual is single (standard health)

The American Association for Long-Term Care Insurance is the professional organization serving insurance and financial professionals nationwide.   The Association’s Website maintains a simple online “look-up” listing long-term care insurance professionals in each Zip Code.

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