Yesterday I reported that my good friend Phyllis Shelton was featured on Lifetime TV’s Balancing Act.

Click here to see her interview. It’s short. I believe you’ll find it relevant and well worth your time.

In her interview, Phyllis talks about how long-term care insurance (LTCi) is lifestyle preservation insurance and nursing home AVOIDANCE insurance, how unpredictable life’s circumstances are, and how women are more at risk for long-term care hazards then men are.

Dear Gail Sheehy,

As a public figure with considerable influence, you have a responsibility to educate yourself before you advise the public on any topic.  Your comments on a recent Diane Rehm Show were not only incorrect, but also harmful because your listeners may use your words as an excuse to do nothing about long-term care planning, eventually suffering severe emotional and financial consequences as a result.

I understand that you were a substitute speaker at our Intercompany Long-Term Care Insurance Conference in March 2010, and I am grateful for your filling in at the last moment.  The audience enjoyed your compelling story about the hardship you endured as a caregiver.

It’s interesting that such a difficult journey evidently taught you so little about everyone’s need to take responsibility to financially plan for long-term care. Even more disturbing is that as an influential public figure, you did not admit that you are out of your area of expertise and instead have no problem giving false information out to the public.

I listened to the part of your interview with Diane Rehm where you gave false information about long-term care insurance. Based on this, I wager that you don’t own long-term care insurance. If I am wrong about this, I will buy you a steak dinner. If you owned long-term care insurance, you would have learned during your buying process that most LTC insurance is NOT capped at $115,000. Your additional misconception that long-term care insurance can be too expensive for many also proves you probably don’t own long-term care insurance.

It’s a real betrayal that such an ill-informed long-term care insurance basher wound up being the keynote speaker at our conference!

This is from Steve Moses’ May, 18, 2010 blog on this subject: “*** GAIL SHEEHY keynoted this year’s Intercompany Long-Term Care Insurance Conference in New Orleans last March. But evidently she’s no friend of long-term care insurance. We got this tip from a corporate supporter of the Center for Long-Term Care Reform: Sheehy was interviewed on the Diane Rehm National Public Radio (NPR) show last week about eldercare/caregiving issues. When asked about her opinion of long term care insurance, she was less than flattering – not at all endorsing such protection. Rather she touted PACE programs through Medicaid as a wonderful service. (PACE is as good as Medicaid gets, but it suffers from inadequate funding like everything in Medicaid.) Listen to the show here. The part in question is around minute 48:25. Diane Rehm comments that most LTC insurance is capped at $115,000 and Ms. Sheehy agrees. The ignorance of influential people in the media who should know better, who have a responsibility to listeners to know better and advise correctly, is mind-boggling. ***”

Thanks to my good friend Phyllis Shelton for echoing my already stated sentiment on the new CLASS LTC program in concise detail, and for allowing me to quote the following:

“The Community Living Assistance Services and Supports (CLASS) Act is a provision in the new health care reform bill (Public Law 111-148) that is supposed to provide a small cash benefit of $50 – $75 a day with a lifetime benefit period depending on the level of impairment (needing help with 2 Activities of Daily Living vs. 4 ADLs). It is supposed to be effective 1/1/2011 and all employees would pay through payroll deduction unless they opt out. Premium must be paid for at least five years before benefits could be claimed. Earlier versions of this legislation suggested low monthly premiums starting at $30 a month. The final version says in Sec. 3203 that the premium is yet to be determined and that it will be based on keeping the program solvent throughout a 75-year period. Premiums can start as low as $5 a month for people below poverty level and workers who are also full-time students under age 22. People who drop out for more than 90 days will have to re-enter at attained age. Even so, the premium can be recalculated in the future and rate increases applied except to enrollees who are age 65 and have paid premium for at least 20 years.

The concern about this program is two-fold: that it will cost much more than is projected and that it will lull Americans into a false sense of security that they are truly protected for long-term care. A $50-$75 a day benefit seems very small vs. current costs of $150+ per day for 8 hours of home care, the cost of which could triple in the next 20 years due to the extreme shortage of caregivers. Also, employers don’t have to offer it and even when they do, employees can opt out. [See "Alternative Enrollment Procedures" Sec. 3204 (2) (C)]

Sec. 3204 Enrollment and Disenrollment Requirements

(2) Alternative Enrollment Procedures — The procedures established under paragraph (1) shall provide for an alternative enrollment process for an individual described in subsection (c) in the case of such an individual

(A) who is self-employed
(B) who has more than 1 employer; or
(C) whose employer does not elect to participate in the automatic enrollment process established by the Secretary

The Academy of Actuaries including the head actuary at CMS (the government branch that runs Medicare and Medicaid) thinks that the premium should be more like $180 per month. I just can’t see employees accepting that much premium for so little benefit. We know how hard it is to educate employees to buy private long-term care insurance for much less premium than that and it doesn’t look like there are dollars budgeted to educate the public at all. Finally, a really big reason it passed is because people have to pay into it 5 years before they can collect benefits. For that time period, Congress looked at it as a revenue generator to help fund the overall health care reform bill. I think they will be sadly disappointed when they see how few employees will accept it. The head actuary at CMS thinks the participation will be only 2%.* Most of them will likely be people who have health issues, which will drive up the number of claims which ultimately leads to the program being underfunded. Therefore I think it will fall way short of the revenue generator it is expected to be.

*Source: Richard Foster, Chief Actuary for CMS, 11-13-09 (p. 11)”

On February 1, 2010, 1.3 million letters were sent to Texas between 40 and 60 years old announcing the new Own Your Future Texas Campaign and urging Texans to take personal responsibility.

The mailing clearly advocates long-term care planning and states long-term care coverage should be a core part of your financial plan. Recipients are invited to call in, mail in, or online order a free long-term care planning kit.

The Own Your Future Texas campaign encourages the public to visit www.OwnYourFutureTexas.org. This site has lots of eye appeal, is easy to navigate, and has comprehensive information about what care costs and how long-term care insurance works. It even has calculators you can use to help you predict your likelihood of needing care, and how much your care may cost.

The Own Your Future Texas Campaign was created by the Texas Legislature. It is a collaborative effort between private long-term care insurance providers, their authorized agents, and state government agencies, including the Texas Department of Insurance, the Texas Health and Human Services Commission, and the Texas Department of Aging.

I, Honey Leveen, LTCQueen, extend my heartfelt good wishes to you in 2010!

November is National Long-Term Care Awareness Month. If you care about someone who doesn’t already own long-term care insurance, I  encourage you to ask them how they intend to pay for care if they need it. One way you can start this conversation is by sharing this video: http://www.youtube.com/watch?v=-xO3UV5hRZg

“The Centers for Medicare and Medicaid Services has ruled to cut payments to skilled nursing care by up to $16 billion over the next ten years, which could boost the sale of Long-Term Care Insurance by as much as 20 percent, says the American Association for Long-Term Care Insurance, an industry trade group.

Because 70 percent of nursing home budgets are eaten up by labor costs, the proposed Medicare cuts will likely affect the care seniors receive. “When these regulatory cuts are considered in addition to possible congressional Medicare cuts, nursing homes will have to face very difficult decisions, including the possibility of staff reductions,” said Bruce Yarwood, President of the American Health Care Association.

Yarwood noted that funding for Medicare and Medicaid are interdependent and that cuts to both programs could negatively impact care for seniors and employment for caregivers. Jesse Slome, executive director of the AALTCI, explained, “Everyone would like the government to pay but no one wants to pay more taxes. As more people recognize the importance of planning for the risk of needing long-term care, insurance will become an increasingly attractive and affordable option.”

The above blurb was taken from “Medicare cuts could lead to increased LTCI sales“, published in Senior Market Advisor, 9/11/09

The American Association for Long-Term Care Insurance (AALTCI) has established November as Long-Term Care Awareness Month (LTCAM). November is  the perfect time to have a conversation that could make a real difference.

It’s important to plan for the possibility of needing care while one is healthy. That’s when the best rates and options are available and families are in much better emotional shape to discuss long term care-related planning. The simple truth is that during a crisis, stress can quickly escalate, causing  tension and strife that could have otherwise been avoided.

I encourage you to talk about the possibility of needing care now.

Consider these facts:

The number of persons aged 65 or older is expected to double in the next 20 years; there will be 110 percent more people 80 or older – U.S. Census Bureau, News Release, August 14, 2008

At least 70% of people over age 65 will require some long term care services at some point; more than 40% will need care in a nursing home – U.S. Department of Health and Human Services, September 2008

Please contact me at 713-988-4671 or honey@honeyleveen.com if I may assist in any way.

Pill$ and Bill$ is the catchy title of a very funny new book about long-term care insurance.  It is sub-titled, “How to Lose It All and End Up in a Nursing Home!”. It bills itself as The Complete Guide to Extreme Poverty.

It takes no more than an hour to read, but you could selectively read chapters, if you prefer. Some of the chapter titles are : “I’m Going to Do Something, Just Not Right Now”, “I’m Just Going to Self-Insure”, “My Children Will Take Care of Me”, “I’m Just Going to Shoot Myself”.

Here’s a quote from the introduction: “How to lose it all and end up in a nursing home is really a very simple process and I promise that this book will show you how to accomplish it. Don’t be discouraged, anyone can do it. In fact, I will venture to say that you are probably well on your way and a lot further along in the process than you are giving yourself credit for…All you need to do is to follow your instincts, seek advice from friends and family, read articles, and talk to experts in the wrong fields….In fact, I can save you a tremendous amount of time along your journey through this process of losing it all and ending up in a nursing home because each chapter in this book will provide you with the exact same information you will get from each of these sources.”

It’s a very funny and entertaining book. Its purpose is to use humor to shake people out of denial and into the reality and necessity for long-term care planning. It takes each of 15 common excuses people make to not buy LTC and simply gives the truth you will need to deny in order to stick with your chosen excuse and wind up losing it all and ending up in a nursing home.

If you’re interested in reading this book, visit www.PillsandBills.com or contact me.

Thanks to the new AALTCI 2009 Sourcebook, I’ve just read the most recent summary of state-by-state sales of long-term care insurance policies. The original report was published by the National Association of Insurance Commissioners (NAIC).

After recovering from my initial shock, I decided I shouldn’t be surprised. Texas is already #1 or #2 in the number of unwanted teen pregnancies, people without health insurance, and high school dropouts. Why not in this area, too? (Please forgive me for venting my frustration here.)

The report shows that in 2007 Texas reported one of the lowest numbers of new LTC policies sold in the country (Results are not yet available for the year 2008).

Considering the large number of Texans between the ages of 45 and 65, who can afford LTC premiums of $50-200/month, I suspect that Texas is dead last among the 50 states in terms of the number of LTC policies sold per capita in 2007.

Texas is #1 in people who can and should buy LTC, but don’t. What a dubious honor!

Unless things change drammatically, I fear Texas will be in dire straights when the huge bulge of Baby Boomers now just turning 65 begin to need care in 15 years or so.  Our system is already unprepared and unable to support them. Please see my December, 2008 blog on what care might look like at that time.