Two elder women share their stories via Youtube about a 90% rate increase for their long-term care (LTC) insurance policy premiums with John Hancock Financial. They are demanding that Congress put a cap on the amount that premiums can be raised for policyholders over a certain age. Both women are retired and on limited incomes. They both bought a LTC policy well over a decade ago to protect their assets and ensure that they don’t have to rely on the government to pay for their LTC costs.
The Department of Health and Human Services estimates that about 70% of American’s will require some form of this kind of care during their lifetime, either in their own home or community, in an assisted living facility or in a nursing home. The cost of these services is very high, ranging from $4,000 – $8,000 a month. About 7 million American’s have purchased long-term care insurance to help cover these expenses.
Patricia Rief-Heskett, one of the women in the video, says that she might have expected a 5% or 10% increase, but not one that nearly doubles her monthly premium from $200 to $370. The letters she and her friend Sylvia (the other woman in the video) received from John Hancock also state that another rate increase could happen again next year.
Patricia says she feels she is at the mercy of this large multi-billion dollar company, which she says took in over $8.6 billion dollars in premiums last quarter. She thinks John Hancock Financial must know that most of their policyholders are older, retired adults, and won’t be able to pay the increase. Many may be forced to drop their policies before ever using any of their benefits, says Patricia. She says this could be a big “win” for the company but is criminal for those who have invested their hard-earned money into their policy.
Bonnie Burns, our Training and Policy Specialist and long-time advocate for ensuring long-term care insurance rights for consumers, reminds policy holders that they have certain rights in California following a premium increase. They may be able to stop paying premiums and keep benefits equal to the premiums they have already paid, or reduce certain benefits in their policy in return for a lower premium. Policyholders in other states may have similar rights. Consumers can contact their state insurance counseling program (HICAP in California) or their state insurance department for assistance.
People considering long-term care policies and other options for financing their long-term care are encouraged to view the information and resources in our Long-Term Care section. For questions and/or counseling on your LTC options, contact your local Health Insurance Counseling and Advocacy Program (HICAP).
Also, watch the full 7-minute youtube video of Patricia and Sylvia, representing the voices of millions of elders, demanding that Congress cap the amount of premium that can be charged to people with LTC insurance who are over a certain age at the time of a premium increase.