Short time deadline looms for federal Long Term Care

Friday - 9/11/2009, 12:52pm EDT

Art Stein, CFP

How to hedge your bets when it comes to changing insurance coverage.

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By Suzanne Kubota
Senior Internet Editor
FederalNewsRadio.com

As a federal employee, you have mere days before you hit a deadline that you may not know exists.

Changes are coming to the Federal Long Term Care Insurance Program on October first. Certified Financial Planner Art Stein told FederalNewsRadio it's important to know "the new program is likely to be a lot more expensive than the existing program and in order to apply for the existing program, applications have to be received by mail at the appropriate place by September 30th."

Stein said it appears online applications for the current program are no longer available. "It looks to me like you'll have to call the 800-number (1-800-LTC-FEDS), they'll send you the application forms and you have to get them back by September 30th."

Applying now, today, has its advantage, said Stein. "Because if you apply now, and your application arrives in time, you lock in your ability to get the current program. We haven't seen much detail on the new program."

When we see the details, if that seems more attractive, then people can just apply for the new program - they don't have to take the old program if they apply this month. It leaves them in the position of being able to make a choice. If you don't get your application in on time, you don't have a choice. You'll have to get the new program which may or may not be what you want.

Anybody applying for Long Term Care insurance, said Stein, should compare the federal policy to what they can get individually to see what will be the best deal for them.

Unlike the average auto or home insurance policy, the insurance company can never change Long Term Care policies "for any reason," says Stein. "They can never reduce someone's benefits, and they can never raise an individual's premium because they received benefits, their health changed or for any other reason."

Because feds are under a deadline, Stein recommends to go ahead and sign up for the current coverage, then compare. "You don't have to take it just because you applied."

According to the Office of Personnel Management, Long Term Care services covered "include: formal and informal care at home, adult day care, assisted living facility care, hospice care and nursing home care."

Stein say the coverage is absolutely critical for retirees and those planning to retire soon. "It's the one thing that could go wrong in their lives."

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On the Web:

Federal Long Term Care Insurance Program - ltcfeds.com

OPM - OPM Awards New Long Term Care Insurance Contract (press release)

Art Stein - ArthurSteinFinancial.com

Mike Causey's Federal Report - Missed Opportunities (with federal benefits expert John Elliott)

Mike Causey's Federal Report - LTC: The New 4-Letter Word

Mike Causey's Federal Report - Navigating the LTC Minefield

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