• Skip to main content
  • Skip to secondary menu
  • Skip to primary sidebar
  • Skip to footer
California Health Advocates

California Health Advocates

  • Contact
  • Home
  • About Us
    • Contact
    • Our Team
    • Mission
    • Education Services
    • About HICAP
    • Press
    • Testimonials
  • MEDICARE COUNSELING
  • Fact Sheets
  • Topics
    • The Basics
    • Prescription Drugs
    • Low-Income Help
    • Medigap
    • Medicare Advantage
    • Other Health Insurance
    • Appeals
    • Billing & Claims
    • Disabilities
    • Long-Term Care
    • Tribal Nations & Medicare
    • Health Care Reform
    • Advocacy & Policy
    • Glossary
  • Fraud & Abuse
  • Blog
  • Donate

Got Long-Term Care Insurance? Dealing with Rate Increases?

California Health Advocates > News > Long-Term Care > Got Long-Term Care Insurance? Dealing with Rate Increases?

Posted by Karen Fletcher on March 17, 2016

Do you have long-term care insurance? Concerned about premium increases? If so, you’re not alone. This is a conundrum elders and policy makers face nationwide. With 1 year of nursing home care costing at least $90,000, who can afford such care? In the 1970s, policy makers hoped long-term care (LTC) insurance would be their answer. Yet this industry has been nothing short of disastrous, as most companies greatly underestimated how long people would live, how much nursing home care they would require, how few people would drop their policies, and how little interest they would actually gain from banked premiums. As a result, most LTC insurance companies have left the market and policyholders are grappling with steep premium increases from each year from the remaining companies. Even California’s CalPERS (California Public Employee Retirement System), the state workers’ retirement plan, has raised their premiums 85% in the last 2 years.

Many policyholders were told to plan ahead and buy a policy early on to secure a good price, as the rates would just increase if one waited to buy a policy later in life. Well this early purchase has not paid off for many policyholders, such as one women featured in a recent Money Magazine article. Currently 69, she bought her policy 20 years ago and has had her premium quadrupled in the last 2 years. She’s facing 3 unattractive options: she can pay the higher cost; reduce the price by reducing the benefits in her policy; or cancel her policy. With so many people facing these undesirable options, California Health Advocates, along with several advocate groups, pushed for more consumer protections, including one that allows those who lapse in their policies to at least use an amount of benefits that equals the amount of premiums already paid out.

With one of the fastest growing population groups being people who are 80 and older, our nation has a long-term care crisis on its hands. Currently Medicaid (Medi-Cal in California), the federal public health insurance program for people with low-incomes and/or disability, covers about ½ of the nation’s long-term care costs and the price tag will continue to rise as baby boomers reach their 80s and 90s in growing numbers. Many people mistakenly assume Medicare, the federal health program for people 65 and older and those younger with disabilities will pay for long term care. While Medicare does pay for short nursing home stays after at least 3 days of inpatient hospital care, it does not pay for personal, or formally referred to as “custodial care” such as eating, bathing, cleaning, cooking, walking, dressing, etc. (See our Medicare Basics section for more info on Medicare coverage.) And, as highlighted, long-term care insurance has priced itself out of the middle class market, especially for women whose premiums are generally 40% higher than men’s.

So where we go from here is something California Health Advocates and several other policy groups are working on. See our website for more information on long-term care and ways of financing LTC.

Filed Under: Long-Term Care, Long-Term Care

Previous Post: « What to Do If You Have a Covered California Plan & Become Eligible for Medicare? (Part 3)
Next Post: What to Do If You Have a Covered California Plan & Become Eligible for Medicare? (Part 4) »

About Karen Fletcher

Our blogger Karen J. Fletcher is CHA's publications consultant. She provides technical expertise, writing and research on Medicare, health disparities and other health care issues. With a Masters in Public Health from UC Berkeley, she serves in health advocacy as a trainer and consultant. See her current articles.

Related Posts

  • CalPERS Update #7: Investigation into CalPERS Long-Term Care Insurance Program
  • CalPERS Update #6: CalPERS Opts Out of Settlement
  • CalPERS Update #5: Settlement Decision Deadline is January 28, 2022
  • CalPERS Long Term Care Insurance Update #4: Replacement Coverage Deadline Extended

Primary Sidebar

Change Text Size

  • 100%  110%  120%  130%  

News & Blog Categories

  • Medicare Advantage
  • Low-Income help
  • Medicare & Disabilities
  • Medicare Basics
  • Prescription Drugs
  • Medicare & Other Health Insurance
  • Medicare Billings, Claims & Appeals
  • Health Care Disparities
  • Fraud & Abuse

—

  • COVID-19
  • Resources
  • Health Care Reform
  • Long-Term Care
  • CHA News

—

  • Advocacy & Policy
  • Letters and Comments to Policymakers
  • Legislative and Congressional Testimony
  • Policy Briefs

Send Us Comment

Do you have comments or concerns about your Medicare coverage? Issues regarding getting your needed prescriptions from your Part D plan, or a Medicare Advantage plan representative's marketing practices? Let us know at comments@cahealthadvocates.org.

We are dedicated to making Medicare's program work well for all beneficiaries. Your feedback from your own or your client's concerns and experiences with Medicare, will guide our Medicare advocacy efforts with key policy and decision-makers in both California and nationally with the Centers for Medicare and Medicaid Services (CMS) and Congress.

Archives

Donate Today

Footer

Sign up for our newsletter

Choose the news you'd like to receive

Important Links

  • About Us
  • Fact Sheets
  • Blog
  • Donate
  • Contact
  • Privacy Notice
  • Cookie Policy
  • Accessibility Statement

Follow Us

Copyright © 2022 · California Health Advocates · Web Design by TWK Web and Print Design · Log in