Through June 24, federal employees can take advantage of a simpler sign-up process for federal long-term care insurance.
During this open season, feds only have to fill out a short-form seven-question application, opposed to a full-form 40-question application when open season is over, said Beth O’Brien of Federal Long Term Care Partners.
The short-form application asks “high-level health questions,” such as if you live in a nursing home or if you have Alzheimer’s disease. Most working feds will answer no to these questions, O’Brien said.
The program, however, does accept some pre-existing conditions. For example, the application does not ask if you have cancer or diabetes, said Paul Forte of FLTCP.
“We recognize that everybody who gets into mid-life has some kind of health condition,” Forte said. “We’re not looking for people to be in perfect health. We’re looking for people to be of average health for their age.”
The approval rate for feds applying for coverage is more than 95 percent, O’Brien said.
Long-term care is designed to help people deal with a chronic illness or debility that prevents them from performing normal daily activities like dressing, eating, bathing or getting to the doctor’s office, Forte said.
“It’s not designed to correct an acute health care problem, but rather to help you with those everyday activities because you simply can’t do them yourself,” he said.
Medicare, FEHB and TRICARE do not cover long-term care, Forte pointed out.
Variety of plans
The average age of feds applying for LTC is about 50 years old, O’Brien said.
More than half of the applicants apply for the plan of a $150 daily benefit for three years and a 4 percent automatic compound inflation option. This plan’s biweekly premium for a 50-year-old is $42.21. When the daily benefit increases to $200, the biweekly premium is $56.28.
“When they see the number, they see it’s more affordable than they thought,” O’Brien said.
The plans vary in daily benefit, length of time and automatic compound inflation adjustments. With the 4 percent compound inflation option, the least expensive plan is the $150 daily benefit for two years with a $33.43 biweekly premium. The most expensive is a $450 daily benefit for an unlimited amount of time. O’Brien said the average length of long-term care is 4 1/2 years.
The two main drivers of cost is the age you purchase the plan the how much inflation protection is built in, Forte said.
“One size doesn’t fit all,” he said. “People shouldn’t think unless they get the equivalent of the Cadillac plan they don’t have a good plan.”
Even the most inexpensive LTC plan includes expert care coordination services, oversight by the Office of Personnel Management, Congress and the Government Accountability Office, and a third-party claims review, if needed, Forte said.
“It’s a little bit like everyone’s retirement plan, which should be unique,” Forte said of LTC. “It depends on your family, it depends on your resources, it depends on how long you want to work, it depends on the lifestyle that you want to live in, where you want to live. And I think there ware many ways to crack this particular nut.”
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