LTC Premiums Rising, So Who Needs It?

Wednesday - 5/6/2009, 4:00am EDT

Ignore this column only if you...

  1. Live in, work from and never leave, a germ-free, climate-controlled, blast-proof bubble.

  2. Eat a perfect diet.

  3. Had super-healthy parents, grandparents and great-grandparents.

  4. Undergo a complete physical every six months.

  5. And, last but not least, have complete and total trust in the person who controls the air-hose to your hermetically-sealed, bomb-proof living quarters. This is someone who can be trusted to check the filters, cater to your germ-proof needs and pay the electric bill so the air pump doesn't go out at a bad time.

Unless you meet all of the above the chances are that having Long Term Care insurance is a no-brainer. LTC pays the bills for things not covered by Medicare, Medicaid, or your federal health insurance plan. Or any other health insurance plan.

LTC insurance pays when you can't take care of yourself because of an illness, Alzheimers or a stroke, old age or a serious accident which can happen as easily at age 30 as it can at age 60.

Most benefits experts say that LTC is a must as part of the package people need to have to get the best care without being a major burden to their families, and to preserve their estates.

Right now, 224,000 active and retired federal and postal workers have LTC through the federal government program. Many others have equally good coverage (sometimes at lower cost) from established insurance companies. But the sad fact is that most feds don't have any kind of LTC coverage. And many don't think about it until they are older, when premiums are higher and they may not be healthy enough to qualify for it. Or until they've had the unexpected illness, or the disabling accident that nobody every plans for.

The Office of Personnel Management has announced changes in the federal LTC contract that will have an effect on many policy-holders.

Premiums rates for some people currently enrolled in the federal LTC program (underwritten by John Hancock Life & Health) will be going up 5 to 25 percent if they have the automatic inflation (ACI) protection. That keep-pace-with-inflation feature is highly recommended by most experts.

OPM's new director John Berry, says this is the first increase in LTC premiums in seven years. It is unlikely, he said, that there will be another increase until at least 2016.

The federal LTC program will provide a "decision period' (in effect a special open season) when current enrolees can choose from a variety of personalized options. One option includes doing nothing and staying with your current benefit package. Or you can take advantage of a one-time chance to switch to a new (both more generous and more costly) benefit plan without underwriting. For more on LTC click here.

Money, Money and Money

Today on our Your Turn with Mike Causey radio show, (10 a.m. EST on your computer or in the DC area at 1500 AM) benefits expert John Elliott will talk about making the most of your federal benefits package. Find out why you probably should have a Flexible Spending Account (and what that is), LTC care, who should buy the government's (FEGLI) life insurance plan, and who should shop on the outside.

Our other guest, financial planner Allan Roth, will talk about where you should NOT be investing during the economic downturn. He's also got some tips about those outfits that advertise a guaranteed 7 percent return. Checkout his latest pdf column from http://daretobedull.com.

If you have questions about benefits or investing, or both, call us if you can (877-936-9333) Or you can e-mail them to me at: mcausey@federalnewsradio.com

Nearly Useless Factoid
by Suzanne Kubota

There are about as many cybersurfers on phones as on computers. New Scientist reports "over 1 billion people rely on computers to access the internet. Yet there are also a billion or so other people who use cellphones to visit cyberspace, making them as much a part of the online community as someone surfing from a PC." Have phone, will travel.

To reach me: mcausey@federalnewsradio.com