Considering a series of announcements made in late 2022, it appears that the Office of Personnel Management (OPM) is planning significant changes to in the Federal Long-Term Care Insurance Program (FLTCIP). These changes are specific to the cost of premiums and plan coverage.
About The FLTCIP
The FLTCIP was established in 2002 under the Long-Term Care Security Act of 2000. Sponsored by the OPM, FLTCIP policy benefits are paid through the John Hancock Insurance Company. FLTCIP is a premium-based insurance option for federal employees to help cover non-medical LTC expenses in a nursing home that are not covered by FEHB or Medicare.
“When the OPM uses words like reprice and revise, it can only mean one thing: a hike in premiums.”
November 2022: OPM May Suspend Enrollment In FLTCIP
Under the final rules published in the Federal Register on November 16, 2022, new enrollments and requests to increase coverage by active enrollees may be suspended after giving 30 days of notice. OPM has the discretion to suspend enrollment indefinitely every 24 month. The reason stated: “… to allow for adjustment to underwriting processes or to reprice premium rates after a review of actuarial assumptions.” When the OPM uses words like reprice and revise, it can only mean one thing: a hike in premiums.
Do You Really Need LTC?
If longevity runs in your family, there’s a strong possibility you will need LTC. According to LongTermCare.gov, someone turning 65 today has a near 70% chance of needing some type of LTC services in the future. Depending on where you live, the average cost of a private room in a nursing home is over $8,000 per month while the average monthly cost of a semi-private room is over $7,000.
Increase Of LTC Insurance In The Private Sector
It should come as no surprise the cost of private sector LTC insurance is rising for the same reasons impacting FLTCIP premiums. Touch base with an FRC® trained advisor to learn about ways to lower your costs. Make sure you also ask about alternative insurance products with similar coverage: Short-Term Care Insurance, Critical Illness Insurance or Annuities With Long-Term Care Riders.
